Will cost of production labor appear to be fixed or variable

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Question: 1. a. A Dunkin' Donuts franchise owner hires a baker to prepare donuts each morning. One baker works Monday through Friday, another works weekends. Both are guaranteed eight-hour days regardless of the number of donuts that need to be prepared each day. The bakers track the amount of time they spend baking donuts. If they have extra time because fewer donuts are needed on a particular day, they may help with selling or perform other tasks if needed. Their pay for time spent on activities other than baking is reported under selling or administrative expense as appropriate. Will the cost of production labor appear to be fixed or variable?

b. A Dunkin' Donuts franchise owner hires a baker to prepare donuts each morning. One baker works Monday through Friday, another works weekends. Both are guaranteed eight-hour days regardless of the number of donuts that need to be prepared each day. Will the cost of production labor appear to be fixed or variable?

c. A Dunkin' Donuts franchise owner hires a baker to prepare donuts each morning. One baker works Monday through Friday, another works weekends. The bakers come in at the same time each morning, bake the number of donuts scheduled for the day, and then punch out and leave for the day. Will the cost of production labor appear to be fixed or variable?

Reference no: EM131880707

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