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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
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 actlvitles: 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 activitles are shown below: Prior to the actlvity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the total cost for the month was $184,400 and that 10,000 diners had been served. Therefore, the average cost per diner was $18.44 ( $184,400 10,000 diners =$18.44 per diner). Required: 1. Compute the activity rates for each of the three activitles. 2. According to the actlvity-based costing system, what is the total cost of serving each of the following partles 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 partles? 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. Complete this question by entering your answers in the tabs below. Compute the activity rates for each of the three activities. (Round your answers to 2 decimal places.) According to the activity-based costing system, what is the total cost of serving each of the following parties of diners? (Round your intermediate calculations and final answers to 2 decimal places.) 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? (Round your intermediate calculations and final answers to 2 decimal places.)
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