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Pop's Burger Haven produces and sells quarter-pound hamburgers. Each burger sells for $3. During December, Pop's sold 10,000 burgers (the average amount sold each month). The restaurant employs cooks, servers, and one supervisor (the owner, Jane Peterson). All cooks and servers are part-time employees. Pop's maintains a pool of part-time employees so that the number of employees scheduled can be adjusted to the changes in demand. Demand varies on a weekly as well as a monthly basis. A janitor is hired to clean the building on a weekly basis. The building is leased from a local real estate company. The building has no seating capabilities. All orders are filled on a drive-through basis. The supervisor spends 30% of her time supervising food production, and the balance of her time supervising counter staff and on various other administrative activities. The following costs were incurred during December:

Pop's Burger Haven produces and sells quarter-pound hamburgers. Each burger sells for $3. During December, Pop's sold 10,000 burgers (the average amount sold each month). The restaurant employs cooks, servers, and one supervisor (the owner, Jane Peterson). All cooks and servers are part-time employees. Pop's maintains a pool of part-time employees so that the number of employees scheduled can be adjusted to the changes in demand. Demand varies on a weekly as well as a monthly basis. A janitor is hired to clean the building on a weekly basis. The building is leased from a local real estate company. The building has no seating capabilities. All orders are filled on a drive-through basis. The supervisor spends 30% of her time supervising food production, and the balance of her time supervising counter staff and on various other administrative activities. The following costs were incurred during December:

FINANCIAL ACCOUNTING
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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Pop's Burger Haven Pop's Burger Haven produces and sells quarter-pound hamburgers. Each burger sells for $3. During December, Pop's sold 10,000 burgers (the average amount sold each month). The restaurant employs cooks, servers, and one supervisor (the owner, Jane Peterson). All cooks and servers are part-time employees. Pop's maintains a pool of part-time employees so that the number of employees scheduled can be adjusted to the changes in demand. Demand varies on a weekly as well as a monthly basis. A janitor is hired to clean the building on a weekly basis. The building is leased from a local real estate company. The building has no seating capabilities. All orders are filled on a drive-through basis. The supervisor spends 30% of her time supervising food production, and the balance of her time supervising counter staff and on various other administrative activities. The following costs were incurred during December: Additional Pop's Burger Haven Hamburger Meat Lettuce Tomatoes Buns Other ingredients Cook's wages Servers' wages Supervisor's salary Utilities Depreciation: Cooking equip. Cash Register Advertising Rent. Janitorial supplies $3,850 380 320 4,500 4,420 4,060 3,000 500 200 100 800 the Probems 50 20 50 Janitorial wages 120 Utility costs consist of a $50 fixed cost with the balance depending upon usage. 39
Transcribed Image Text:Pop's Burger Haven Pop's Burger Haven produces and sells quarter-pound hamburgers. Each burger sells for $3. During December, Pop's sold 10,000 burgers (the average amount sold each month). The restaurant employs cooks, servers, and one supervisor (the owner, Jane Peterson). All cooks and servers are part-time employees. Pop's maintains a pool of part-time employees so that the number of employees scheduled can be adjusted to the changes in demand. Demand varies on a weekly as well as a monthly basis. A janitor is hired to clean the building on a weekly basis. The building is leased from a local real estate company. The building has no seating capabilities. All orders are filled on a drive-through basis. The supervisor spends 30% of her time supervising food production, and the balance of her time supervising counter staff and on various other administrative activities. The following costs were incurred during December: Additional Pop's Burger Haven Hamburger Meat Lettuce Tomatoes Buns Other ingredients Cook's wages Servers' wages Supervisor's salary Utilities Depreciation: Cooking equip. Cash Register Advertising Rent. Janitorial supplies $3,850 380 320 4,500 4,420 4,060 3,000 500 200 100 800 the Probems 50 20 50 Janitorial wages 120 Utility costs consist of a $50 fixed cost with the balance depending upon usage. 39
Pop's Burger Haven: discussion points 1. Prepare an income statement using GAAP. 2. Classify the costs of Pop's December operation in one of the following categories: direct materials, direct labor, overhead, and selling and administration. 3. Prepare a variable costing income statement. 4. What does it cost Pop's to produce and sell one more hamburger? S. What is the additional profit, if Pop's produces and sells one more hamburger? 6. How many hamburgers must Pop's sell in order to stay in business? GAAP Income Statement Sales COGS GM Selling Admin NI Pop's Burger Haven ACE 3200 HEE MIN LET 30,000 Used primarily for external reporting. Contribution Margin Income Statement Sales VC CM FC NI ACC3200 HEEMIN LEE 30,000 Used primarily by management.
Transcribed Image Text:Pop's Burger Haven: discussion points 1. Prepare an income statement using GAAP. 2. Classify the costs of Pop's December operation in one of the following categories: direct materials, direct labor, overhead, and selling and administration. 3. Prepare a variable costing income statement. 4. What does it cost Pop's to produce and sell one more hamburger? S. What is the additional profit, if Pop's produces and sells one more hamburger? 6. How many hamburgers must Pop's sell in order to stay in business? GAAP Income Statement Sales COGS GM Selling Admin NI Pop's Burger Haven ACE 3200 HEE MIN LET 30,000 Used primarily for external reporting. Contribution Margin Income Statement Sales VC CM FC NI ACC3200 HEEMIN LEE 30,000 Used primarily by management.
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