The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such as washing plates and glasses, depend on the number of diners served or the number of drinks served. Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the total cost for the month (including organization-sustaining costs) was $180,000 and that 12,000 diners had been served. Therefore, the average cost per diner was $15. Required: 1&2. According to the activity-based costing system, what is the total cost and average cost per diner for serving each of the following parties of diners? (Round your intermediate calculations to 2 decimal places. Round your Total Cost final answers to 2 decimal places and your Average Cost final answers to 3 decimal places.) a. A party of four diners who order four drinks in total. b. A party of two diners who do not order any drinks. c. A party of one diner who orders three drinks. Total Cost Average Cost per diner per diner per diner
The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such as washing plates and glasses, depend on the number of diners served or the number of drinks served. Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the total cost for the month (including organization-sustaining costs) was $180,000 and that 12,000 diners had been served. Therefore, the average cost per diner was $15. Required: 1&2. According to the activity-based costing system, what is the total cost and average cost per diner for serving each of the following parties of diners? (Round your intermediate calculations to 2 decimal places. Round your Total Cost final answers to 2 decimal places and your Average Cost final answers to 3 decimal places.) a. A party of four diners who order four drinks in total. b. A party of two diners who do not order any drinks. c. A party of one diner who orders three drinks. Total Cost Average Cost per diner per diner per diner
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
11.
Transcribed Image Text:The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top-
management salaries.
Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other
costs, such as washing plates and glasses, depend on the number of diners served or the number of drinks served.
Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the total cost for
the month (including organization-sustaining costs) was $180,000 and that 12,000 diners had been served. Therefore, the average
cost per diner was $15.
Required:
1&2. According to the activity-based costing system, what is the total cost and average cost per diner for serving each of the following
parties of diners? (Round your intermediate calculations to 2 decimal places. Round your Total Cost final answers to 2 decimal
places and your Average Cost final answers to 3 decimal places.)
a. A party of four diners who order four drinks in total.
b. A party of two diners who do not order any drinks.
c. A party of one diner who orders three drinks.
Total Cost
Average Cost
per diner
per diner
per diner
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