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Molly recently got a job at a coffeehouse close to University of Calgary campus where she is attending school, in the Haskayne School of Business.
Molly recently got a job at a coffeehouse close to University of Calgary campus where she is attending school, in the Haskayne School of Business. The hours work well with her school schedule, the pay is good and she enjoys her friends dropping in to visit her. The owner of the coffee house is not around very much so the employees are supervised by a couple of other older more experienced employees. One of her co-workers, Melissa, often gives her friends free coffee when they come in. Sometimes they order a food item too and sometimes they don't. Molly is tempted to do the same for her Haskayne friends, but she is worried about the impact on the coffeehouse sales and is wondering about the ethics of the situation! She knows that they charge $3.00 for a mug of coffee, and it only costs the owner $0.90 for the coffee beans and $0.20 for the water, so the Contribution Margin is pretty good. Food items are not as good because they take more time and materials to make. Molly thinks the Contribution Margin is about 35% on average for food items. She has no idea what other costs there might be. Required: Advise Molly regarding her issue. Identify three (3) other operating costs not yet discussed above that might be impacted by her decision. Explain the financial impact and any other non-financial matters that you believe should be considered
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