Carreras Café is a Spanish restaurant in a college town. The owner expects that the number of meals served in June will be 40 percent below those served in May, because so many students leave for the summer. In May, the restaurant served 4,200 meals at an average price of $20. In the summer (June through August), the average price of a meal typically increases by 30 percent and the average food cost of a meal increases by 15 percent. Other costs are typically unchanged during the summer. The following cost information is available for May. Service costs (variable with respect to meals) Variable service costs (with respect to meals) Food costs $ 10,200 Labor 16,800 Other variable costs 5,900 Fixed service costs 9,300 Total service costs $ 42,200 Marketing and administrative costs Marketing (variable with respect to meals) 6,400 Administrative (fixed) 4,900 Total marketing and administrative costs $ 11,300 Total costs $ 53,500 Required: Prepare a budgeted income statement for June. (Do not round intermediate calculations.)
Carreras Café is a Spanish restaurant in a college town. The owner expects that the number of meals served in June will be 40 percent below those served in May, because so many students leave for the summer. In May, the restaurant served 4,200 meals at an average price of $20. In the summer (June through August), the average price of a meal typically increases by 30 percent and the average food cost of a meal increases by 15 percent. Other costs are typically unchanged during the summer. The following cost information is available for May. Service costs (variable with respect to meals) Variable service costs (with respect to meals) Food costs $ 10,200 Labor 16,800 Other variable costs 5,900 Fixed service costs 9,300 Total service costs $ 42,200 Marketing and administrative costs Marketing (variable with respect to meals) 6,400 Administrative (fixed) 4,900 Total marketing and administrative costs $ 11,300 Total costs $ 53,500 Required: Prepare a budgeted income statement for June. (Do not round intermediate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Carreras Café is a Spanish restaurant in a college town. The owner expects that the number of meals served in June will be 40 percent below those served in May, because so many students leave for the summer. In May, the restaurant served 4,200 meals at an average price of $20. In the summer (June through August), the average price of a meal typically increases by 30 percent and the average food cost of a meal increases by 15 percent. Other costs are typically unchanged during the summer. The following cost information is available for May.
| Service costs (variable with respect to meals) | ||
| Variable service costs (with respect to meals) | ||
| Food costs | $ | 10,200 |
| Labor | 16,800 | |
| Other variable costs | 5,900 | |
| Fixed service costs | 9,300 | |
| Total service costs | $ | 42,200 |
| Marketing and administrative costs | ||
| Marketing (variable with respect to meals) | 6,400 | |
| Administrative (fixed) | 4,900 | |
| Total marketing and administrative costs | $ | 11,300 |
| Total costs | $ | 53,500 |
Required:
Prepare a
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