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Annie B's Homemade Ice Cream is an ice cream shop in Asheville, NC. Annie's Homemade currently owns one push cart along with a branded tent to facilitate off-site sales. The company is considering buying a second push cart and tent for $4,500 to expand its off- site sales opportunities. Because the company's cargo trailer has the capacity to transport two push carts, there is no need to buy an additional trailer at this time. Annie's provided the following estimates to assist with analyzing the investment in an additional push cart: Additional sales events per month (in June, July, August, and September) Average number of servings sold per event Selling price per serving Ingredients and packaging cost per serving Average time for manager to make one batch of 100 servings of ice cream Average time for employees to pre-package one serving of ice cream Pickup truck diesel fuel, oil, and diesel exhaust fluid expenses Average duration of each event (including drive time) Average number of employees working at each event Hourly wage rate for managers Hourly wage rate per employee Average round-trip mileage to each sales event Required: 1. What is the net cash inflow for one additional off-site event? Note: Round your answers to 2 decimal places. 6 100 $ 5.00 $ 1.40 1.5 hours 1.2 minutes $ 0.50 per mile 2 hours 2 $ 15.00 $ 8.00 19 miles Answer is complete and correct. Sales $ 500.00 Ingredientsand packaging Production labor cost: manager Production labor cost: employees $ 140 22.50 16.00 Event labor cost: manager 30.00 Event labor cost: employees 32.00 Pickup truck expenses 9.50 Net cash inflow for one additional off-site event $ 250.00 250.00 2. What is the net cash inflow per month, assuming six events per month? Answer is not complete. Net cash inflow per month 3. What is the second push cart's payback period in months, assuming six events per month? Payback period months

Annie B's Homemade Ice Cream is an ice cream shop in Asheville, NC. Annie's Homemade currently owns one push cart along with a branded tent to facilitate off-site sales. The company is considering buying a second push cart and tent for $4,500 to expand its off- site sales opportunities. Because the company's cargo trailer has the capacity to transport two push carts, there is no need to buy an additional trailer at this time. Annie's provided the following estimates to assist with analyzing the investment in an additional push cart: Additional sales events per month (in June, July, August, and September) Average number of servings sold per event Selling price per serving Ingredients and packaging cost per serving Average time for manager to make one batch of 100 servings of ice cream Average time for employees to pre-package one serving of ice cream Pickup truck diesel fuel, oil, and diesel exhaust fluid expenses Average duration of each event (including drive time) Average number of employees working at each event Hourly wage rate for managers Hourly wage rate per employee Average round-trip mileage to each sales event Required: 1. What is the net cash inflow for one additional off-site event? Note: Round your answers to 2 decimal places. 6 100 $ 5.00 $ 1.40 1.5 hours 1.2 minutes $ 0.50 per mile 2 hours 2 $ 15.00 $ 8.00 19 miles Answer is complete and correct. Sales $ 500.00 Ingredientsand packaging Production labor cost: manager Production labor cost: employees $ 140 22.50 16.00 Event labor cost: manager 30.00 Event labor cost: employees 32.00 Pickup truck expenses 9.50 Net cash inflow for one additional off-site event $ 250.00 250.00 2. What is the net cash inflow per month, assuming six events per month? Answer is not complete. Net cash inflow per month 3. What is the second push cart's payback period in months, assuming six events per month? Payback period months

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 17E
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Annie B's Homemade Ice Cream is an ice cream shop in Asheville, NC. Annie's Homemade currently owns one push cart along with a branded tent to facilitate off-site sales. The company is considering buying a second push cart and tent for $4,500 to expand its off- site sales opportunities. Because the company's cargo trailer has the capacity to transport two push carts, there is no need to buy an additional trailer at this time. Annie's provided the following estimates to assist with analyzing the investment in an additional push cart: Additional sales events per month (in June, July, August, and September) Average number of servings sold per event Selling price per serving Ingredients and packaging cost per serving Average time for manager to make one batch of 100 servings of ice cream Average time for employees to pre-package one serving of ice cream Pickup truck diesel fuel, oil, and diesel exhaust fluid expenses Average duration of each event (including drive time) Average number of employees working at each event Hourly wage rate for managers Hourly wage rate per employee Average round-trip mileage to each sales event Required: 1. What is the net cash inflow for one additional off-site event? Note: Round your answers to 2 decimal places. 6 100 $ 5.00 $ 1.40 1.5 hours 1.2 minutes $ 0.50 per mile 2 hours 2 $ 15.00 $ 8.00 19 miles Answer is complete and correct. Sales $ 500.00 Ingredientsand packaging Production labor cost: manager Production labor cost: employees $ 140 22.50 16.00 Event labor cost: manager 30.00 Event labor cost: employees 32.00 Pickup truck expenses 9.50 Net cash inflow for one additional off-site event $ 250.00 250.00 2. What is the net cash inflow per month, assuming six events per month? Answer is not complete. Net cash inflow per month 3. What is the second push cart's payback period in months, assuming six events per month? Payback period months
Transcribed Image Text:Annie B's Homemade Ice Cream is an ice cream shop in Asheville, NC. Annie's Homemade currently owns one push cart along with a branded tent to facilitate off-site sales. The company is considering buying a second push cart and tent for $4,500 to expand its off- site sales opportunities. Because the company's cargo trailer has the capacity to transport two push carts, there is no need to buy an additional trailer at this time. Annie's provided the following estimates to assist with analyzing the investment in an additional push cart: Additional sales events per month (in June, July, August, and September) Average number of servings sold per event Selling price per serving Ingredients and packaging cost per serving Average time for manager to make one batch of 100 servings of ice cream Average time for employees to pre-package one serving of ice cream Pickup truck diesel fuel, oil, and diesel exhaust fluid expenses Average duration of each event (including drive time) Average number of employees working at each event Hourly wage rate for managers Hourly wage rate per employee Average round-trip mileage to each sales event Required: 1. What is the net cash inflow for one additional off-site event? Note: Round your answers to 2 decimal places. 6 100 $ 5.00 $ 1.40 1.5 hours 1.2 minutes $ 0.50 per mile 2 hours 2 $ 15.00 $ 8.00 19 miles Answer is complete and correct. Sales $ 500.00 Ingredientsand packaging Production labor cost: manager Production labor cost: employees $ 140 22.50 16.00 Event labor cost: manager 30.00 Event labor cost: employees 32.00 Pickup truck expenses 9.50 Net cash inflow for one additional off-site event $ 250.00 250.00 2. What is the net cash inflow per month, assuming six events per month? Answer is not complete. Net cash inflow per month 3. What is the second push cart's payback period in months, assuming six events per month? Payback period months
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