Make or Buy A restaurant bakes its own bread for a cost of $160 per unit (100 loaves), including fixed costs of $33 per unit. A proposal is offered to purchase bread from an outside source for $95 per unit, plus $7 per unit for delivery. Prepare a differential analysis dated July 7 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread, assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "O". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Make Bread (Alt. 1) or Buy Bread (Alt. 2) July 7 Differential Effect Make Bread (Alternative 1) (Alternative 2) Buy Bread on Income (Alternative 2) Sales price $0 $0 $0 Unit Costs: $ Purchase price Delivery Variable costs Fixed factory overhead Make the bread Buy the bread the company should make (Alternative 1) or buy (Alternative 2) the bread.

Question
Make or Buy
A restaurant bakes its own bread for a cost of $160 per unit (100 loaves), including fixed costs of $33 per unit. A proposal is offered to purchase bread from
an outside source for $95 per unit, plus $7 per unit for delivery.
Prepare a differential analysis dated July 7 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread, assuming that
fixed costs are unaffected by the decision. If an amount is zero, enter "O". For those boxes in which you must enter subtracted or negative numbers use a
minus sign.
Differential Analysis
Make Bread (Alt. 1) or Buy Bread (Alt. 2)
July 7
Differential Effect
Make Bread
(Alternative 1) (Alternative 2)
Buy Bread
on Income
(Alternative 2)
Sales price
$0
$0
$0
Unit Costs:
$
Purchase price
Delivery
Variable costs
Fixed factory overhead
Make the bread
Buy the bread
the company should make (Alternative 1) or buy (Alternative 2) the bread.
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Transcribed Image Text

Make or Buy A restaurant bakes its own bread for a cost of $160 per unit (100 loaves), including fixed costs of $33 per unit. A proposal is offered to purchase bread from an outside source for $95 per unit, plus $7 per unit for delivery. Prepare a differential analysis dated July 7 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bread, assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "O". For those boxes in which you must enter subtracted or negative numbers use a minus sign. Differential Analysis Make Bread (Alt. 1) or Buy Bread (Alt. 2) July 7 Differential Effect Make Bread (Alternative 1) (Alternative 2) Buy Bread on Income (Alternative 2) Sales price $0 $0 $0 Unit Costs: $ Purchase price Delivery Variable costs Fixed factory overhead Make the bread Buy the bread the company should make (Alternative 1) or buy (Alternative 2) the bread.

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