Question

A restaurant bakes its own bread for $ 152 per unit (100 loaves), including fixed costs of $ 39 per unit. A proposal is offered to purchase bread from an outside source for $ 105 per unit, plus $ 12 per unit for delivery. Prepare a differential analysis dated August 16, 2014, to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread, assuming fixed costs are unaffected by the decision.



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  • CreatedJune 27, 2014
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