8 Exercise 2-61 (Algo) Value Income Statement (LO 2-7) 10 points Baubee Meal Delivery Service (BMDS) provides restaurant to customer meal deliveries for food establishments in a suburban neighborhood. The company provides you with the following information for the third quarter of operations: Sales revenue $ 300,000 Variable costs of operations, excluding labor costs (note a) 79,000 Employee wages and salaries (note b) 72,000 eBook Manager salaries (note c) 42,000 Fixed cost of delivery vans (note d) 23,000 18,200 48,000 Building costs (rent, utilities, etc.) (note e) IT costs including support (note f) Notes: a. 5 percent of this cost was wasted due to poor directions given to delivery van drivers. b. 5 percent of this cost was for time spent by delivery van drivers because of poor directions. c. 10 percent of this cost was time taken to address customer complaints. d. The vans have 40 percent unused capacity. e. The building has 10 percent unused capacity. f. The IT system has 40 percent unused capacity. Required: a. Using the traditional income statement format, prepare a value income statement. b. What value would there be to the managers at BMDS from preparing the same information in the following quarters? Required A Required B Using the traditional income statement format, prepare a value income statement. Note: Loss amounts should be indicated with a minus sign. BAUBEE MEAL DELIVERY SERVICE Value Income Statement For the Quarter Ending September 30 Nonvalue-added Activities Value-added Activities Total Sales revenue Cost of services sold: Variable costs of operations, excluding labor costs Employee wages and salaries Fixed cost of delivery vans Gross margin (loss) Administrative expenses: Managers' salaries Building costs IT costs including support Operating income (loss) < Required A Required B > Required A Required B What value would there be to the managers at BMDS from preparing the same information in the following quarters? Preparing a value income statement helps BMDS see whether he is improving in reducing nonvalue-added activities. OPreparing a value income statement helps BMDS see whether he is improving in reducing value-added activities. < Required A Required B >