Reuben’s Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Reuben's Deli cost data Costs Amounts Increments Materials $0.24 per roll Labor 0.40 per roll Variable overhead 0.16 per roll Fixed overhead 0.20 per roll A) A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. What are the total relevant costs?

Reuben’s Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Reuben's Deli cost data Costs Amounts Increments Materials $0.24 per roll Labor 0.40 per roll Variable overhead 0.16 per roll Fixed overhead 0.20 per roll A) A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. What are the total relevant costs?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 6EA: Reubens Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in...

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Costs	Amounts	Increments
Materials	$0.24	per roll
Labor	0.40	per roll
Variable overhead	0.16	per roll
Fixed overhead	0.20	per roll

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