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Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery
Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria's owner has determined that the shop has two major cost drivers-the number of pizzas sold and the number of deliveries made. The pizzeria's cost formulas appear below: Fixed Cost per Month Pizza ingredients Cost per Pizza $ 4.70 Cost per Delivery Kitchen staff $ 6,190 Utilities $ 750 $ 0.70 Delivery person Delivery vehicle $ 770 $ 3.50 $ 1.70 Equipment depreciation $ 512 Rent $ 2,150 Miscellaneous $ 870 $ 0.10 In November, the pizzeria budgeted for 1,980 pizzas at an average selling price of $13 per pizza and for 200 deliveries. Data concerning the pizzeria's actual results in November were as follows: Actual Results 2,080 Pizzas Deliveries Revenue Pizza ingredients Kitchen staff 180 $ 27,730 $ 9,730 $ 6,130 Utilities Delivery person Delivery vehicle Equipment depreciation Rent Miscellaneous $ 955 $ 630 $ 1,014 $ 512 $ 2,150 + 971
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