Question: Chipotle is deciding whether to continue making guacamole in the restaurant or buy it from an outside supplier. Chipotle's cost information is as follows
Chipotle is deciding whether to continue making guacamole in the restaurant or buy it from an outside supplier. Chipotle's cost information is as follows (unit is a tub full of guacamole): Direct Materials Direct Labor Variable Overhead Worker Salary Depreciation of Avocado Peeler Cost per Unit $7.89 $5.94 $2.09 $6.99 $1.38 $1.48 Allocated General Overhead Assume the avocado peeler has a salvage value of $0 and cannot be used for any other purpose. Assume all direct labor is variable and the worker can be terminated. What is the total per unit relevant cost of producing guacamole that Chipotle should consider in its decision? Round your answer to the nearest cent.
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