Required Information Exercise 4-47 and 4-48 (Algo) (LO 4-4) [The following information applies to the questions displayed below) Mel's Meals 2 Go purchases cookles that it includes in the 10,000 box lunches it prepares and sells annually. Mel's kitchen and adjoining meeting room operate at 70 percent of capacity. Mel's purchases the cookies for $0.62 each but is considering making them instead. Mel's can bake each cookie for $0.20 for materials, $0.18 for direct labor, and $0.61 for overhead without increasing its capacity. The $0.61 for overhead includes an allocation of $0.38 per cookle for fixed overhead. However, total fixed overhead for the company would not Increase if Mel's makes the cookies. Mel himself has come to you for advice. "It would cost me $0.99 to make the cookies, but only $0.62 to buy. Should I continue buying them?" Materials and labor are variable costs, but variable overhead would be only $0.23 per cookle. Two cookies are put into every lunch. Exercise 4-47 (Algo) Make-or-Buy Decisions (LO 4-4) Required: a. Prepare a schedule to show the differential costs per cookie. (Enter your answers to 2 decimal places. Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect.) Status Quo Alternative (Buy) (Make) Difference Cost to buy Direct material Direct labor Variable overhead Total costs $ 0.00 S 0.00 Required Information Exercise 4-47 and 4-48 (Algo) (LO 4-4) The following information applies to the questions displayed below.) Mel's Meals 2 Go purchases cookies that it includes in the 10,000 box lunches It prepares and sells annually. Mel's kitch and adjoining meeting room operate at 70 percent of capacity. Mel's purchases the cookies for $0.62 each but considering making them instead. Mel's can bake each cookle for $0.20 for materials, $0.18 for direct labor, and $0.61 f overhead without increasing its capacity. The $0.61 for overhead Includes an allocation of $0.38 per cookle for fixe overhead. However, total fixed overhead for the company would not increase of Mel's makes the cookies. Mel himself has come to you for advice. "It would cost me $0.99 to make the cookies, but only $0.62 to buy. Should continue buying them?" Materials and labor are variable costs, but variable overhead would be only $0.23 per cookie Two cookies are put into every lunch. Exercise 4-48 (Algo) Make or Buy with Opportunity Costs (LO 4-4) Mel suddenly finds an opportunity to sell boxed dinners. The new opportunity would require the use of the 30 percent unused capacity. The contribution margin from the dinners would amount to $3,800 annually. Required: a. If Mel decides to sell dinners, what are the total costs for both making and buying the cookies? Total cost of making cookies Total cost of buying cookies