Milano Pizza has a small area for in-store dining as well as offers take-out and free home delivery services. The pizzeria's owner determined the shop has two major cost drivers-the number of pizzassold and the number of deliveries made.The pizzeria's cost formulas appear below:Fixed Cost per Month Cost per Pizza Cost per DeliveryPizza ingredients $ 4.90Kitchen staff $ 6,010Utilities $ 660 $ 0.80Delivery person $ 2.60Delivery vehicle $ 680 $2.00Equipment depreciation $ 440Rent $1,970Miscellaneous $ 780 $ 0.10In November, the pizzeria budgeted for 1,710 pizzas at an average selling price of $20 per pizza and for 190 deliveries. Data concerning the pizzeria's actual results in November were as follows:Actual ResultsPizzas 1,810Deliveries 170Revenue $ 36,800Pizza ingredients $ 8, 110Kitchen staff $ 5,950Utilities $ 910Delivery person $ 442Delivery vehicle $ 996Equipment depreciation $ 440Rent $ 1,970Miscellaneous $ 820Required:1. Complete the flexible budget performance report for November.Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values

Step 1: Calculate the Flexible Budget for Revenue and CostsThe budgeted revenue is based on the…

Answered: Milano Pizza has a small area for…

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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Helen and Donald met with the supervisor of the pizza division of a medium-sized Italian food supplier. The supervisor explained the two key costs in his division, as follows. Cost Type Each pizza MOH Number of Units Helen's cost model Donald's cost model 2,900 MOH cost 2,900 Total Although Helen and Donald used this data to estimate a model for the division's costs, they each came up with a different model, as follows. $13,630 $3,770 Total pizza division cost = $4.70 (number of pizzas) + $3,770 Total pizza division cost = $6.00 (number of pizzas) What understanding did Helen have about the cost behavior of these costs?
Shanghai Company sells glasses, fine china, and everyday dinnerware. They use activity-based costing to determine the cost of the shipping and handling activity. The shipping and handling activity has an activity rate of $5 per pound. A box of glasses weighs 2 lbs, the box of china weighs 4 lbs, and a box of everyday dinnerware weighs 6 lbs. Round answers to nearest whole dollar. a Determine the shipping and handling activity for each product. Glasses $fill in the blank 1 China $fill in the blank 2 Everyday dinnerware $fill in the blank 3 b Determine the total shipping and receiving costs for the china if 2,000 boxes are shipped.$fill in the blank 4
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Cathy, the manager of Cathy’s Catering, Inc., uses activity-based costing to compute the costs of her catered parties. Each party is limited to 20 guests and requires 5 people to serve and clean up. Cathy offers two types of parties—an afternoon picnic and an evening formal dinner. The breakdown of the costs follows. Activities (and cost drivers) Afternoon Picnic Formal Dinner Advertising (parties) $ 125 per party $ 125 per party Planning (parties) $ 50 per party $ 144 per party Renting equipment (parties, guests) $ 55 per party plus $13 per guest $ 77 per party plus $24 per guest Obtaining insurance (parties) $ 230 per party $ 375 per party Serving (parties, servers) $ 40 per server per party $ 66 per server per party Preparing food (guests) $ 22 per guest $ 35 per guest Per party costs do not vary with the number of guests. Required: a. Compute the cost of a 20-guest afternoon picnic. b. Compute the cost of a 20-guest evening formal dinner. c. How much…
David Berger is the F&B director at the private membership Fox Ridge Country Club. He is implementing a new dining room menu and has calculated menu prices for the six new entrée items the menu will include. Complete the table below and then answer the questions that follow. Menu Item Selling Price Product Cost Per Serving Labor Cost Food Cost % Prime Cost Contribution Margin New York Strip $ 26.95 $ 12.97 $ 1.95 1/2 Duckling $ 25.95 $ 11.73 $ 2.55 Veal Chop $ 31.95 $ 13.85 $ 1.95 Roasted Free Range Chicken $ 18.95 $ 6.53 $ 2.55 Pork Medallions $ 24.95 $ 5.58 $ 3.10 Portabella Mushroom Pasta $ 18.95 $ 3.85 $ 4.25
a. What impact would accepting this special order have on operating profit? b. From an operating profit perspective for April, should Maria accept the order?
Bakeryco sells cakes and croissants. Its only constraint is total employee work hours of 300 per week. SFco would like to order 1240 croissants and pay $5.30 each for them. Given the information below, should Bakeryco take SFco’s order? Cakes Croissants Usual Price $32 $6.50 VC $18.50 $1.95 Time required to make 90 minutes 3 minutes Current sales volume 123 per week 2,120 per week
Cathy, the manager of Cathy’s Catering, Inc., uses activity-based costing to compute the costs of her catered parties. Each party is limited to 20 guests and requires 5 people to serve and clean up. Cathy offers two types of parties—an afternoon picnic and an evening formal dinner. The breakdown of the costs follows. Activities (and cost drivers) Afternoon Picnic Formal Dinner Advertising (parties) $ 81 per party $ 81 per party Planning (parties) $ 54 per party $ 124 per party Renting equipment (parties, guests) $ 49 per party plus $12 per guest $ 71 per party plus $23 per guest Obtaining insurance (parties) $ 220 per party $ 355 per party Serving (parties, servers) $ 58 per server per party $ 70 per server per party Preparing food (guests) $ 18 per guest $ 31 per guest Per party costs do not vary with the number of guests. Required: a. Compute the cost of a 20-guest afternoon picnic. b. Compute the cost of a 20-guest evening formal dinner. c. How much…
Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria's owner has determined that the shop has two major cost drivers the number of pizzas sold and the number of deliveries made. The pizzeria's cost formulas appear below: Pizza ingredients Fixed Cost Cost per per Month Pizza $ 4.50 $ 5,930 Cost per Delivery Kitchen staff Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $ 620 $640 $ 408 $1,890 $740 $0.40 $ 3.20 $ 0.20 $ 1.60 In November, the pizzeria budgeted for 1,590 pizzas at an average selling price of $16 per pizza and for 230 deliveries. Data concerning the pizzeria's actual results in November appear below. Actual Results Pizzas Deliveries Revenue 1,690 210 Kitchen staff Delivery person $27,600 Pizza ingredients $ 7,390 $ 5,870 Utilities. $ 890 $ 672 $ 988 $ 408 $ 1,890 $ 796 Delivery vehicle Equipment depreciation Rent Miscellaneous…
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