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Objectives of the
Domino’s Pizza LLC. operates pizza delivery and carry-out restaurants. The annual report describes its business as follows:
We offer a focused menu of high- quality, value-priced pizza with three types of crust (Hand-Tossed. Thin Crust, and Deep Dish), along with buffalo wings, bread sticks, cheesy bread. CinnaStixâ, and Coca-Colaâ products. Our band-tossed pizza is made from fresh dough produced in our regional distribution centers. We prepare every pizza using real cheese, pizza sauce made from fresh tomatoes, and a choice of high-quality meat and vegetable toppings in generous portions. Our focused menu and use of premium ingredients enable us to consistently and efficiently produce the highest-quality pizza.
Over the 41 years since our founding, we have developed a simple, cost-efficient model, We offer a limited menu, our stores are designed for delivery and carry-out and we do not generally offer dine-in service. As a result, our stores require relatively small. lower-rent locations and limited capital expenditures.
How would a master budget support planning, directing, and control for Domino’s?
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Chapter 21 Solutions
Financial & Managerial Accounting
- Special Order Pete's Pizza makes the best pizzas in town. Based on Pete's current volume, the price and cost breakdown is outlined below. The local high school has asked Pete to be their sole pizza provider for a large event and has offered to order 500 pizzas at a special price. Assuming Pete has the capacity to produce these pizzas, identify which of the following items are relevant in deciding whether to accept this special order. Per unit Relevant? Normal sales price $ Special price 12.00 9.30 4.00 Direct materials Direct labor 3.00 Variable overhead 0.50 Fixed overhead 3.00 Should Pete accept the order in either of the following scenarios? A. Pete has capacity to produce these pizzas with no additional investments. B. Pete would need to rent a piece of equipment to accommodate the order. The rent would cost Pete: $ 2,380 For each scenario below, enter the relevant amounts of accepting this special order of 500 pizzas in total (not per unit): Scenario A B Enter "=0" in the cell for…arrow_forwardMilano 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…arrow_forwardWhy Does It Matter? MACS CUSTOM CATERING, Eugene, Oregon Macs Custom Catering, an award-winning catering business located in Eugene, Oregon, specializes in providing only the best for you and your guest. Macs Custom Catering has been in business for over 30 years and is experienced in providing catering services at weddings, corporate events, and large sit-down events. It offers several signature buffet options, including Northwest Bounty, Hawaiian Luau, and Italian Fest. Imagine that you have been hired to set up the accounting system for a catering business such as Macs. What accounts would be included in the chart of accounts? As you list the accounts, identify the type of account. Is the account an asset, a liability, or owners equity?arrow_forward
- Focused Value Streams, Product Costing Sixty employees (all CPAS) of a local public accounting firm eat lunch at least twice weekly at a very popular pizza restaurant. The pizza restaurant recently began offering discounts for groups of 15 or more. Groups would be seated in a separate room, served individual bowls of salad costing $1.60 each, pitchers of root beer costing $3.00 each (each pitcher has a five-glass capacity), and medium, two-topping pizzas for $11.00 (10 slices each). The food would have to be ordered in advance. Thirty of the CPASs commit to eating two slices of pizza, four glasses of root beer, and one bowl of salad [a consumption pattern of (2,4,1)]. The other 30 are more hearty eaters and commit to eight slices of pizza, four glasses of root beer, and one bowl of salad [a consumption pattern of (8,4,1)]. Each member of the group must pay an assessed amount for the lunch. Required: 1. Determine the total number of pizzas, pitchers of root beer, and salads that must be…arrow_forwardFive-step decision-making process, manufacturing. Madison Foods makes frozen dinners that it sells through grocery stores. Typical products include turkey, pot roast, fried chicken, and meatloaf. The managers at Madison have recently proposed a line of frozen chicken pies. They take the following actions to help decide whether to launch the line. Madison’s test kitchen prepares a number of possible recipes for a consumer focus group.Sales managers estimate they will sell more chicken pies in their eastern sales territory than in their western sales territory. Managers discuss the possibility of introducing a new chicken pie. Managers compare actual labor costs of making chicken pies with their budgeted costs. Profits from selling chicken pies are budgeted. The company decides to introduce a new chicken pie. To help decide whether to introduce a new chicken pie, the company researches the price and quality of competing chicken pies. Classify each of the actions as a step in the…arrow_forwardWhat is the best strategy for a RDN to use to benchmark financial performance, both internally and externally, in child nutrition and other like-minded, non-profit programs? Group of answer choices Comparing average monthly costs to local restaurants Determining total meal costs based on total meal equivalents Standardizing all recipes Implementing a food safety program based on HACCP principlesarrow_forward
- The Grand Inn is a restaurant in Flagstaff, Arizona. It specializes in southwestern style meals in a moderate price range. Paul Weld, the manager of Grand, has determined that during the last 2 years the sales mix and contribution margin ratio of its offerings are as follows. Sales mix is determined using total sales dollars. Appetizers Main entrees Desserts Beverages (a) Appetizers Percent of Total Sales Main entrees 15 % Your answer is correct. Desserts 50 % Beverages 10 % Total restaurant sales $ 25 % Paul is considering a variety of options to try to improve the profitability of the restaurant. His goal is to generate a target net income of $117,000. The company has fixed costs of $1,053,000 per year. Solution Calculate the total restaurant sales and the sales of each product line that would be necessary to achieve the desired target net income. (Round intermediate calculations to 3 decimal places e.g. 0.251 and final answers to O decimal places, e.g. 2,510.) $ $ Contribution…arrow_forwardBuffalo BBQ Restaurant is trying to become more efficient in training its chefs. It is experimenting with two training programs aimed at this objective. Both programs have basic and advanced training modules. The restaurant has provided the following data regarding the two programs after two weeks of implementation: Training Program A Training Program B New chef # 1 2 3 4 5 6 7 8 9 10 Hours of basic training 24 26 26 19 25 22 23 29 29 21 Hours of advanced training 6 7 8 12 9 3 2 0 1 4 Number of chef mistakes 14 15 14 15 13 5 7 9 4 6 a. Compute the following performance metrics for each program: (1) Average hours of employee training per chef, rounded to one decimal place. (2) Average number of mistakes per chef, rounded to one decimal place.arrow_forwardResource Usage Model, Special Order Ehrling, Inc., manufactures metal racks for hanging clothing in retail stores. Ehrling was approached by the CEO of Carly's Corner, a regional nonprofit food bank, with an offer to buy 350 heavy-duty metal racks for storing canned goods and dry food products. While racks normally sell for $245 each, Carly's Corner offered $75 per rack. The CEO explained that the number of families they served had grown significantly over the past two years, and that the charity needed additional storage for the donated food items. Since Ehrling is operating at 80 percent of capacity, and Ehrling employees have "adopted" Carly's Corner as their annual charity, the company wants to make the special order work. Ehrling's controller looked into the cost of the storage racks using the following information from the activity-based accounting system: Activity Rate** Unused Quantity Activity Driver Capacity Demanded* Fixed Variable Direct materials Number of racks 350 $82…arrow_forward
- Resource Usage Model, Special Order Ehrling, Inc., manufactures metal racks for hanging clothing in retail stores. Ehrling was approached by the CEO of Carly’s Corner, a regional nonprofit food bank, with an offer to buy 350 heavy-duty metal racks for storing canned goods and dry food products. While racks normally sell for $245 each, Carly’s Corner offered $75 per rack. The CEO explained that the number of families they served had grown significantly over the past two years, and that the charity needed additional storage for the donated food items. Since Ehrling is operating at 80 percent of capacity, and Ehrling employees have “adopted” Carly’s Corner as their annual charity, the company wants to make the special order work. Ehrling’s controller looked into the cost of the storage racks using the following information from the activity-based accounting system: Activity Rate** Activity Driver UnusedCapacity QuantityDemanded* Fixed Variable Direct materials Number of racks 0…arrow_forwardCarmel Company has a frequent buyer program for its customers, where the customers can attain an "elite" level based on the number of orders and the total revenue of the orders. There are twoelite levels: Platinum and Titanium. The benefits of elite membership include discounts and access to special customer service representatives who can resolve problems. The company has one full time customer representative per 200 Titanium customers and one full-time customer representa tive per 2,000 Platinum customers. Customer representatives receive salaries plus bonuses of 2 percent of customer gross margin. Carmel spends 70 percent of its promotion costs on Titanium customers to encourage their loyaltyarrow_forwardOriole Dinner Box Inc. is a catering company that sells meal kits that its customers can take home and quickly prepare. The company sells its meal kits at local grocery stores and has recently begun to offer a monthly subscription service, which delivers meal kits to the customer's home. Single meal kits can be purchased at grocery stores. Approximately 10% of the kits shipped to grocery stores each month are returned unsold and are then discarded. Oriole charges the grocery stores $15 for each meal kit. In December 2024, Oriole began selling three- month subscriptions for $900. Subscriptions are paid in advance and are non-cancellable. Oriole sold 840 subscriptions on December 1,2024, which entitle the subscriber to 15 meal kits each month beginning in December 2024. During December, 4,620 meal kits were sold, on account, to grocery stores and all required subscriber meals were delivered. Grocery stores have 30-day terms of payment with Oriole. (a1) Your answer is correct. Determine…arrow_forward
- Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubFinancial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,College Accounting (Book Only): A Career ApproachAccountingISBN:9781337280570Author:Scott, Cathy J.Publisher:South-Western College Pub
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