Problem 4-14 Compute and Use Activity Rates to Determine the Costs of Serving Customers [LO4-2, LO4-3, LO4-4] Gino's Restaurant is a popular restaurant in Boston, Massochusetts. The owner of the restourant 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 activities: A group of diners who ask to sit ot the same table is counted as a party. Some costs, such as the costs of clearing 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 rumber of diners served. Data concerning these octivities are shown below: Prior to the activity-bosed costing study, the owner knew very ittle about the costs of the restaurant she know thet the total cost for the month was $270,200 and that 20,000 diners had been served. Therefore, the average cost per diner was $13.51 (\$270.200 20,000 diners =$13.51 per diper). Required: 1. Compute the activity rotes for each of the three activities 2. According to the activity-based costing system, what is the total cost of serving each of the following parties of diners? a. A party of four diners who order thiee dinks in total. b. A party of two diners who do not order any drinks. c. A lone diner who orders two drinks. Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the totai cost for the month was $270,200 and that 20,000 diners had been served. Therefore, the average cost per diner was $13,51 (\$270,200 20,000 diners =$13,51 per diner). Required: 1. Compute the activity rates for each of the three activities. 2. According to the activity-based costing system, what is the total cost of serving each of the following parties 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 parties? 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) Required: 1 Compute the activity rates for each of the three activities. 2. According to the activity-based costing system, what is the total cost of serving each of the following parties 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 dinet in other words, what is the average cost per diner for serving each of the following parties? 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. According to the activity-based costing system, what is the total cost of verving each of the following parties of diners? (Round your intermediate caiculations and final answers to 2 decimal plocen.) 2. According to the activity-based costing system, what is the total cost of serving each of the following parties 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 fo serving each of the following parties? 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. 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 eoch of the following parties? (Round your intermediate calculations and final answers to 2 decimal places
