Question: Suppose Roasted Pepper restaurant is considering whether to (1) bake bread for its restaurant in-house or (2) buy the bread from a local bakery. The

 Suppose Roasted Pepper restaurant is considering whether to (1) bake bread
for its restaurant in-house or (2) buy the bread from a local

Suppose Roasted Pepper restaurant is considering whether to (1) bake bread for its restaurant in-house or (2) buy the bread from a local bakery. The chef estimates that variable costs of making each loaf include $0.52 of ingredients, 50.27 of variable overhead (electricity to run the oven), and $0.79 of direct labor for kneading and forming the loaves. Allocating fixed overhead (depreciation on the kitchen equipment and building) based on direct labor, Roasted Popper assigns $0.96 of fixed overhead per loat. None of the fixed costs are avoidable. The local bakery would charge $1.78 per loaf. Read the requirements Requirements 1. What is tho unit cost of making the bread in-house? Complete the following outsourcing decision analysis to determine Roasted Pepper's unit cost of making the bread Roasted Pepper Outsourcing Decision Direct material Direct labor Variable overhead Variable cost per unit Entor any number in the edit fields and then click Check Answer 2 ports romaining Clear All Check Answer s the unit cos * Requirements Outsourcing de coasted Pepp sourcing Deci 1. What is the full product unit cost of making the bread in-house? 2. Should Roasted Pepper bake the bread in-house or buy from the local bakery? Why? 3. In addition to the financial analysis, what else should Roasted Pepper consider when making this decision? unit Print Done the edit fields

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