Suppose a Roasted Oive restaurant is considering whether to (1) bake bread for its restaurant in-house or (2) buy the breadd from a local bakary. The cref estirnates that variable costs of making each loal include $0.52 of ingredients, $0.24 of variable overhead (electricity to run the ovent, and 50.78 of disect iabor for kreiking and forming the loaves. Allocating fixed overhead (depreciabion on the kitchen equipment and building) based on cirect labor assigris $1 bt of fored overhase per bat None of the fixed costs are avoidabie. The local bakery would charge Roasted Oive \$1.78 per ioat. 1. What is the absorption cost of making the bread in house? What is the variable cost per loaf? 2. Should Roasted Olive bake the bread in-house or buy from the local bakery? Why? 3. In addition to the financial analysis, what else should Roasted Olive consider when making this decision? 1. What is the absorption cost of making the bread in-house? What is the variabie coat por loat? Get more help