The airline is serving meals to all passengers as part of their package service. The following cost of one complete meal they are presently serving are as follows Variable cost: Ingredients (P6.00) Direct Labor (P4.00) Variable OH (P4.00) Fixed Cost (allocated to products): Supervisor Salaries and other fixed costs (P4.00) Depreciation of flight kitchen equipment (P4.00) Total Cost per meal (P25.00) The catering services has offered to supply meals for Php20.00 each. Assume further that Php1.00 of the total fixed costs could be eliminated. Fixed cost per unit was computed using the normal operations of 2,000 meals per month. Given the data, what is the total relevant cost to buy airline meals? OP30,000.00 O P15.00 P20.00 P40,000.00

The airline is serving meals to all passengers as part of their package service. The following cost of one complete meal they are presently serving are as follows Variable cost: Ingredients (P6.00) Direct Labor (P4.00) Variable OH (P4.00) Fixed Cost (allocated to products): Supervisor Salaries and other fixed costs (P4.00) Depreciation of flight kitchen equipment (P4.00) Total Cost per meal (P25.00) The catering services has offered to supply meals for Php20.00 each. Assume further that Php1.00 of the total fixed costs could be eliminated. Fixed cost per unit was computed using the normal operations of 2,000 meals per month. Given the data, what is the total relevant cost to buy airline meals? OP30,000.00 O P15.00 P20.00 P40,000.00

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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