Question
Make or Buy A restaurant bakes its own bread for a cost of $160 per unit (100 loaves), including fixed costs of $34 per unit.
Make or Buy A restaurant bakes its own bread for a cost of $160 per unit (100 loaves), including fixed costs of $34 per unit. A proposal is offered to purchase bread from an outside source for $104 per unit, plus $8 per unit for delivery. Question Content Area Prepare a differential analysis dated July 7 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread, assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Differential Analysis Make Bread (Alt. 1) or Buy Bread (Alt. 2) July 7
Make Bread (Alternative 1) | Buy Bread (Alternative 2) | Differential Effect on Income (Alternative 2) |
Sales price | $0 | $0 | $0 |
Unit Costs: | |||
Purchase price | $fill in the blank 7c06570d0fe1f8d_1 | $fill in the blank 7c06570d0fe1f8d_2 | $fill in the blank 7c06570d0fe1f8d_3 |
Delivery | fill in the blank 7c06570d0fe1f8d_4 | fill in the blank 7c06570d0fe1f8d_5 | fill in the blank 7c06570d0fe1f8d_6 |
Variable costs | fill in the blank 7c06570d0fe1f8d_7 | fill in the blank 7c06570d0fe1f8d_8 | fill in the blank 7c06570d0fe1f8d_9 |
Fixed factory overhead | fill in the blank 7c06570d0fe1f8d_10 | fill in the blank 7c06570d0fe1f8d_11 | fill in the blank 7c06570d0fe1f8d_12 |
Income (Loss) | $fill in the blank 7c06570d0fe1f8d_13 | $fill in the blank 7c06570d0fe1f8d_14 | $fill in the blank 7c06570d0fe1f8d_15 |
Determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread.
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