Your bakery can produce 2,000 unit of bagel per week for 48 weeks of operation per year. You aim to stay in this businessfor five years.You can either make the dough for the bagels in house or buy them from a different source.If you make the dough in house, you face with annual labour costs: $30,000, annual safety regulation costs: $5,000 and annual material costs: $20,000. But, if you choose to buy the dough from a different source, you must have a special dough-mixer machine to make adjustment for your production. Therefore, you need to pay $10,000 for the dough mixer machine, which has $500 salvage value at the end of 5 years. Furthermore, you face with annual maintaining costs including labour costs: $30,000 and additional overhead costs: $20,000 Using this information, find the unit cost of buy the bagel option with MARR 20%.

Question 4 options:

a)

Between $0.70 and $0.80

b)

Between $1.20 and $1.30

c)

None of the answers are correct

d)

Between $0.50 and $0.60

e)

Between $1.00 and $1.10

f)

Between $0.20 and $0.30