Bucknum Boys, Inc., produces hunting gear for buck hunting. The company’s main production departments are Molding and Finishing.
Production of the hunting gear cannot be accomplished without the supporting tasks of Materials Management and meals for production employees provided by the Cafeteria. Cafeteria costs are always higher than Materials Management costs. The company believes that the number of employees in each department is the best driver of Cafeteria costs. The number of employees in each department is as follows: Molding Department 27 Finishing Department 30 Materials Management Department 3 Cafeteria Department 6 The company also believes that the value of support materials used in each department is the best driver for Materials Management costs. The support materials used in the Molding and Finishing departments are valued at $1,800 and $2,700, respectively. Using the sequential method for support department cost allocation (allocating Cafeteria costs first):
Market prices control the supply for coffee shops, not only that but also it is also affected by other factors with things like: price of inputs, and how much it cost to make, and technology developments