Question: please answer all questions! itructuring a Make-or-Buy Problem resh Foods, a large restaurant chain, needs to determine if it would be cheaper to produce 5,000

 please answer all questions! itructuring a Make-or-Buy Problem resh Foods, a
large restaurant chain, needs to determine if it would be cheaper to
please answer all questions!

itructuring a Make-or-Buy Problem resh Foods, a large restaurant chain, needs to determine if it would be cheaper to produce 5,000 units of its main food ingredient for use in its restaurants o purchase them from an outside supplier for $12 each. Cost information on internal production indudes the following: Fixed overhead will continue whether the ingredient is produced internally or externally. No adaitional costs If purchasing will be incurred beyond the purchase price. If required, round your answers to the nearest whole number. Required: 1. What are the alternatives for Fresh. Foods? 2. Ust the relevant cost(s) of internal production and of external purchose. 1. What are the alternatives for Fresh Foods? 2. List the relevant cost(s) of internal production and of external purchase. 3. Which alternotive is more cost effective and by how much? (Use total cost when giving your answer.) 4. Now assume that 20% of the foxed overhead can be avoided ir the ingredient is purchased externaly. Which aiternative is more cost effective and by how much? (Use total cost when giving your answer.)

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