The Bountiful Bakery Is Considering Hiring Another Pastry Chef

question 112

Multiple Choice

The Bountiful Bakery is considering hiring another pastry chef.The bakery knows that the average product of its chefs currently is 15 dozen croissants per day.It also believes that the next chef hired will produce an extra 12 dozen croissants per day.A dozen croissants sell for $30.The bakery should hire another worker:

• A) only if the new chef's marginal product is 12 dozen or more.
• B) only if the new chef's daily wage is $450 or less.
• C) only if the new chef's daily wage is $360 or less.
• D) because the marginal product is below the average product.

Calculate sales price and volume variances to assess performance in non-manufacturing contexts.

Recognize the impact of volume changes on unit fixed and variable costs.

Understand the accounting treatment for insignificant cost variances.

Understand the process and significance of recording labor costs in financial statements.

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Definitions:

Publishing Company

A business specializing in producing and distributing books, magazines, journals, or digital content.

Economic Value

The worth of a good or service determined by the market or its impact on an entity's financial condition.

Utility

The extent to which something provides economic value greater than its cost.

Practicality

The aspect of being sensible, realistic, and focused on what is achievable and efficient in real-world situations.