Question
Laurel Corporation owns it cafeteria with the following annual costs: Food $100,000 Food Preparation Labor 75,000 Overhead 110,000 The overhead is 40% fixed. Of the
- Laurel Corporation owns it cafeteria with the following annual costs:
Food $100,000
Food Preparation Labor 75,000
Overhead 110,000
The overhead is 40% fixed. Of the fixed overhead, $25,000 is the salary of the cafeteria manager. The remainder of the fixed overhead has been allocated from total company overhead. The company is considering outsourcing its cafeteria services. Assuming the cafeteria supervisor will remain with the company and that Laurel will continue pay his/her salary if outsourced, the maximum cost Laurel will be willing to pay an outside firm to provide cafeteria service is
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Given that 40 of the cost is fixed 110000 of it is fixed overhead The cafete...
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Niebels Methods, Standards and Work Design
Authors: Andris Freivalds, Benjamin Niebel
13th edition
978-0073376363, 73376361, 978-0073376318
