Perform an incremental analysis, Cost Accounting

Assignment Help:

Bakers Bagels LLC produces and sells 20 types of bagels by the dozen. Bagels are priced at $6.00 per dozen (or $0.50 each) and cost $.020 per unit to produce. The company is considering processing the bagels further into two products.: bagels with cream cheese and bagel sandwiches. It would cost an additional $0.50 per unit to produce bagels with cream cheese, and the new selling price would be $2.50 each. It would cost an additional $1.00 per sandwich to produce bagel sandwiches, and the new selling price would be $3.50 each.

1. Identify the relevant per-unit costs and revenues for the alternatives. Are there any sunk costs?
2. Based on the information in requirement 1, should Bakers Bagels expand its product offerings?
3. Suppose that Bakers Bagels did expand its product line to include bagels with cream cheese and bagel sandwiches. Based on customer feedback, the company determined that it could further process those two products into bagels with cream cheese and fruit and bagel sandwiches with cheese. The company's accountant compiled the following information:

Sales.revenue.if.sold.w/o.further.processing &Sales.Rev.if.Processed &Further Processing Costs
Bagels with cream cheese [$2.50 ][$3.50][ Fruit : $1.00]
Bagel sandwiches [3.50][ 4.50 ][Cheese: $0.50]

Perform an incremental analysis to determine if Bakers Bagels should process its products further. Explain your findings.

 


Related Discussions:- Perform an incremental analysis

Time keeping - cost accumulation, Time Keeping - Cost Accumulation A l...

Time Keeping - Cost Accumulation A labour cost control routine should ensure that payments are paid only to employees who have spent time at the work place and that payments a

Difference between cost accounting and financial accounting, The difference...

The difference among "cost accounting" and "financial accounting are terms demote to the accounting techniques used internally by a company's management to explain the costs of run

Calculate monthly excess returns, In this exercise you will familiarize you...

In this exercise you will familiarize yourself with index models, beta and CAPM estimation. Download the spreadsheet data_question3.xlsx from Sakai and use the data contained there

Depreciation, This is the amount charged due to the usage and passage of ti...

This is the amount charged due to the usage and passage of time. Fixed assets are utilized for earning revenue. Thus, a decrease in their value is considered to be the operational

Profit or loss on the disposal of the fixtures and fittings, This task invo...

This task involves the recording of non-current asset information in the general (nominal, main) ledger and other non-current asset matters. You are assisting in preparing the a

Assignment of variance in variance calculation, Assignment of Variance in V...

Assignment of Variance in Variance Calculation In variances calculating, the calculations require to be detailed sufficient hence the responsibility for the variance can be a

IDLE CAPACITY, HOW DOES IDLE CAPACITY EFFECT COST BEHAVIOR PATTERNS AND FAC...

HOW DOES IDLE CAPACITY EFFECT COST BEHAVIOR PATTERNS AND FACTORY OVERHEAD METHODS?

Determine operating segments, Vincent Ltd operates solely in Western Austra...

Vincent Ltd operates solely in Western Australia and the chief operating decision maker has identified five operating segments: Mining, Insurance, Retailing, Manufacturing and Tran

Calculate the receivable turnover ratio, Presented here is the basic financ...

Presented here is the basic financial information from the 2009 annual reports of Intel and Advanced Micro Devces (AMD), the two primary manufacturers of silicon chips for personal

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd