Ralphs restaurant

Ralph's Restaurant has the following information for year 2, when several new employees were added to the waitstaff Sales revenue Cost of food served Employee wages and salaries Manager salaries Building costs (rent, utilities, etc.) $140.000 50.400 19.600 23,000 17.000 a 5 percent of this cost was for food that was not used by the expiration date and 10 percent was for food that was incorrectly prepared because of errors in orders taken 515 percent of this cost was for time spent by cooks to reprepare orders that were incorrectly prepared because of errors in orders taken 20 percent of this cost was time taken to address customer complaints about incorrect orders 0 100 percent of the building was used Required: a. Using the traditional income statement format, prepare a value income statement (Loss amounts should be indicated with a minus sign.) RALPH'S RESTAURANT Value Income Statement For the Year 2 Ending December 31 Nonvalue-added Value-added Activities Activities Total Sales revenue Cost of merchandise Cost of food served Gross margin loss) Operating expenses Employee salaries and wages Manager salaries Building costs Operating income foss) b. What value would there be to Ralph from preparing the same information in year 3? O Preparing a year 3 statement helps Ralph see whether the company is improving in reducing nonvalue-added activities O Preparing a year 3 statement helps Ralph see whether the company is improving in reducing value-added activities