Cost Behavior Analysis in a Restaurant: High-Low Cost Estimation Assume a Papa John's restaurant has the following information available regarding costs at representative levels of monthly sales: Monthly sales in units 5,000 8,000 10,000 Cost of food sold $10,000 $16,000 $20,000 Wages and fringe benefits 4,200 4,320 4,400 Fees paid delivery help 1,100 1,760 2,200 Rent on building 1,100 1,100 1,100 Depreciation on equipment 900 900 900 Utilities 800 920 1,000 Supplies (soap, floor wax, etc.) 250 340 400 Administrative costs 1,700 1,700 1,700 Total $20,050 $27,040 $31,700 (a) Identify each cost as being variable, fixed, or mixed. Cost of food sold Wages and fringe benefits Fees paid delivery help
Cost Behavior Analysis in a Restaurant: High-Low Cost Estimation Assume a Papa John's restaurant has the following information available regarding costs at representative levels of monthly sales: Monthly sales in units 5,000 8,000 10,000 Cost of food sold $10,000 $16,000 $20,000 Wages and fringe benefits 4,200 4,320 4,400 Fees paid delivery help 1,100 1,760 2,200 Rent on building 1,100 1,100 1,100 Depreciation on equipment 900 900 900 Utilities 800 920 1,000 Supplies (soap, floor wax, etc.) 250 340 400 Administrative costs 1,700 1,700 1,700 Total $20,050 $27,040 $31,700 (a) Identify each cost as being variable, fixed, or mixed. Cost of food sold Wages and fringe benefits Fees paid delivery help
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Cost Behavior Analysis in a Restaurant: High-Low Cost Estimation
Assume a Papa John's restaurant has the following information available regarding costs at representative levels of monthly sales:
Monthly sales in units
5,000
8,000 10,000
Cost of food sold
$10,000 $16,000 $20,000
Wages and fringe benefits
4,200
4,320
4,400
Fees paid delivery help
1,100
1,760
2,200
Rent on building
1,100
1,100
1,100
Depreciation on equipment
900
900
900
Utilities
800
920
1,000
Supplies (soap, floor wax, etc.)
250
340
400
Administrative costs
1,700
1,700
1,700
Total
$20,050 $27,040 $31,700
(a) Identify each cost as being variable, fixed, or mixed.
Cost of food sold
Wages and fringe benefits
Fees paid delivery help
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