Question
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.
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 pizzerias owner has determined that the shop has two major cost driversthe number of pizzas sold and the number of deliveries made.
The pizzerias cost formulas appear below:
| Fixed Cost per Month | Cost per Pizza | Cost per Delivery | ||||||||
| Pizza ingredients | $ | 4.50 | ||||||||
| Kitchen staff | $ | 5,930 | ||||||||
| Utilities | $ | 620 | $ | 0.40 | ||||||
| Delivery person | $ | 3.20 | ||||||||
| Delivery vehicle | $ | 640 | $ | 1.60 | ||||||
| Equipment depreciation | $ | 408 | ||||||||
| Rent | $ | 1,890 | ||||||||
| Miscellaneous | $ | 740 | $ | 0.20 | ||||||
In November, the pizzeria budgeted for 1,590 pizzas at an average selling price of $16 per pizza and for 230 deliveries.
Data concerning the pizzerias actual results in November appear below:
| Actual Results | |||
| Pizzas | 1,690 | ||
| Deliveries | 210 | ||
| Revenue | $ | 27,600 | |
| Pizza ingredients | $ | 7,390 | |
| Kitchen staff | $ | 5,870 | |
| Utilities | $ | 890 | |
| Delivery person | $ | 672 | |
| Delivery vehicle | $ | 988 | |
| Equipment depreciation | $ | 408 | |
| Rent | $ | 1,890 | |
| Miscellaneous | $ | 796 | |
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Process Safety Management Risk Management Planning Auditing Handbook A Checklist Approach
Authors: David Einolf, Luverna Menghini
1st Edition
086587686X, 978-0865876866
