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Make versus Buy decision: Olden Charm Bakery makes sandwiches, pastries, cakes, and cookies. Currently, it makes its own sourdough bread at a total unit cost

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Make versus Buy decision: Olden Charm Bakery makes sandwiches, pastries, cakes, and cookies. Currently, it makes its own sourdough bread at a total unit cost of $1.72: Direct materials $0.78 Direct labor 0.48 Variable OH 0.26 Fixed OH 0.20 Total unit cost $1.72 On average, Olden Charm Bakery needs 1, 000 loaves of sourdough dough bread every month. Costco, a sourdough bread manufacturer, has approached Olden Charm Bakery with a proposal to provide all the bread that Olden Charm Bakery needs at a unit price of $1.50. Should Olden Charm Bakery continue to make its own sourdough bread or should it buy it from Costco? Assume 3/4 of the fixed OH is avoidable.| j

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