Adamia Bakery Pty Ltd sells multi-flavours of cupcakes to customers. The business has recently become...
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Accounting
Adamia Bakery Pty Ltd sells multi-flavours of cupcakes to customers. The business has recently become concerned about its ability to plan and control the cost. Adam and Damia, the companys founders believe that they can use the cost equation functions (Y = a + bX) to summarise the companys monthly cost. These are the cost incurred in the business:
Monthly rental of the premise = $15,000 per month
Maintenance of the ovens = $2,500 per month
Salary of the production bakers = $28 per labour hour
Raw material cost to produce a cupcake = $5.50 per cupcake
REQUIRED:
Using the cost equation functions, calculate an estimate of the companys total costs if Adamia Bakery Pty Ltd production bakers work 430 hours in a single month of July 2020.
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