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Jordan's Lakeside is a popular restaurant located on Lake Muskoka in Ontario. The owner of the restaurant has been trying to better understand costs at
Jordan's Lakeside is a popular restaurant located on Lake Muskoka in Ontario. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an ABC study. The intern, in consultation with the owner, identified the following major activities: One or more diners who ask to sit at a table are 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 displayed below. Prior to the ABC study, the owner knew very little about the costs of the restaurant. She knew that the total cost for the month was $183,950 and that 11,750 diners had been served. Therefore, the average cost per diner was approximately $15.66(=$183,95011,750 diners). Required: 1. Compute the activity rate for each of the three activities. (Round your answers to 2 decimal places.) 2. According to the ABC system, what is the total cost of serving each of the following parties of diners? (Do not round calculations. Round your answers to 2 decimal places.) 3. Convert the total costs you computed in part (2) to costs per diner. In other words, what is the average cost per diner for serving each of the following parties of diners? (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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