FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:A restaurant bakes its own bread at a cost of $1.70 per loaf including fixed costs of 42 cents
per loaf. A proposal is to purchase bread from an outside source for $1.15 per loaf plus a
delivery fee of 15 cents per loaf. Prepare a differential analysis in the proper format to
determine whether should continue to make (alternative 1) or buy (alternative 2) the bread,
assuming that fixed costs will not be affected by the decision.
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