Gino's Restaurant is a popular restaurant in Boston, Massachusetts. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified the following major activities Activity Cost Pool Serving a party of diners Serving diner Serving drinks A group of diners who ask to sit at the same table is counted as a party. Some costs, such as the costs of cleaning linen, are the same whether one person is at a table or the table is full. Other costs, such as washing dishes, depend on the number of diners served. Data concerning these activities are shown below: Total cost Total activity. Activity Measure Number of parties served Number of diners served Number of drinks ordered Party Serving $ 56,000 7,000 parties a. A party of four diners who order three drinks in total b. A party of two diners who do not order any drinks. c. A lone diner who orders two drinks Serving Diner $ 109,000 30,000 diners 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 was $345,300 and that 30,000 diners had been served. Therefore, the average cost per diner was $11.51 ($345,300- 30,000 diners $11.51 per diner) Serving a Party Serving a Diner Sening Drinks Required: 1. Compute the activity rates for each of the three activities 2. According to the activity-based costing system, what is the total cost of serving each of the following parties of diners? a. A party of four diners who order three drinks in total. b. A party of two diners who do not order any drinks c. A lone diner who orders two drinks. 3. Convert the total costs you computed in part (2) above to costs per diner. In other words, what is the average cost per diner for serving each of the following parties? Complete this question by entering your answ Serving Drinks $ 100,300 59,000 drinks answers in the tabs below. Total $ 345, 300 Required 1 Required 2 Required 3 Compute the activity rates for each of the three activities. (Round your answers to 2 decimal places) Cost per Unit of Activity per party per diner Iner drink

Gino's Restaurant is a popular restaurant in Boston, Massachusetts. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified the following major activities Activity Cost Pool Serving a party of diners Serving diner Serving drinks A group of diners who ask to sit at the same table is counted as a party. Some costs, such as the costs of cleaning linen, are the same whether one person is at a table or the table is full. Other costs, such as washing dishes, depend on the number of diners served. Data concerning these activities are shown below: Total cost Total activity. Activity Measure Number of parties served Number of diners served Number of drinks ordered Party Serving $ 56,000 7,000 parties a. A party of four diners who order three drinks in total b. A party of two diners who do not order any drinks. c. A lone diner who orders two drinks Serving Diner $ 109,000 30,000 diners 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 was $345,300 and that 30,000 diners had been served. Therefore, the average cost per diner was $11.51 ($345,300- 30,000 diners $11.51 per diner) Serving a Party Serving a Diner Sening Drinks Required: 1. Compute the activity rates for each of the three activities 2. According to the activity-based costing system, what is the total cost of serving each of the following parties of diners? a. A party of four diners who order three drinks in total. b. A party of two diners who do not order any drinks c. A lone diner who orders two drinks. 3. Convert the total costs you computed in part (2) above to costs per diner. In other words, what is the average cost per diner for serving each of the following parties? Complete this question by entering your answ Serving Drinks $ 100,300 59,000 drinks answers in the tabs below. Total $ 345, 300 Required 1 Required 2 Required 3 Compute the activity rates for each of the three activities. (Round your answers to 2 decimal places) Cost per Unit of Activity per party per diner Iner drink

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 1TP: In a team of two or three students, interview the manager/owner of a local business. In this...

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