QUESTION 3 owner of the restaurant has been trying to better udy. You, in consul

Question

QUESTION 3 owner of the restaurant has been trying to better udy. You, in consultation with Gino's Restaurant is a popular restaurant in Boston, Massachusetts. The understand costs at the restaurant and has hired you to conduct an activity-based costing st the owner, identified the following major activities: Activity Measure Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Number of parties served Number of diners served Number of drinks ordered Some costs, such as the cost of cleaning the linens that cover the restaurants tables, vary with the number of parties served. Other costs, such as washing plates and glasses, depends on the number of diners served or the number of drinks served. Data concerning these activities are shown below. Serving a Party Serving a Dinner Serving Drinks 36,000 $220,000 $70,000 Total cost Total activity 8,000 parties 29,000 diners 51,000 drinks Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant According to the activity-based costing system, what is the total cost of serving a party of 3 diners who order 3 drinks in total? Do not round intermediate calculations. Round your final answers to 2 decimal places. Ignore the dollar sign.

Explanation / Answer

Calculate Total cost :

Serving a party cost (36000/8000) 4.5 Serving a dinner (220000/29000*3) 22.76 Serving a drinks (70000/51000*3) 4.12 Total cost 31.38

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