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The Bake Shop (TBS) buys and sells cakes. To preserve freshness TBS donates cakes that have not been sold within 5 days to charitable organizations.
The Bake Shop (TBS) buys and sells cakes. To preserve freshness TBS donates cakes that have not been sold within 5 days to charitable organizations. To avoid waste TBS usually orders fewer cakes than it can sell. Sold out signs are frequently seen in the store. Even so, the cakes come in several flavors and occasionally some of the flavors do not sell out before the 5 day shelf life expires. Cakes cost $24 each to purchase and are sold for $30 each. During the most recent month TBS had customer orders for 36 cakes that could not be filled due to a lack of inventory. There were only 20 cakes that had to be donated to charity during the month. Based on this information the Multiple Choice cost of waste amounted to $600. cost of waste amounted to $864. opportunity cost amounted to $720. opportunity cost amounted to $216
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