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Sophia's Restaurant served 7,000 meals last quarter. Sophia recorded the following costs with those meals. Variable costs: Ingredients used Direct labor Indirect materials and
Sophia's Restaurant served 7,000 meals last quarter. Sophia recorded the following costs with those meals. Variable costs: Ingredients used Direct labor Indirect materials and supplies Utilities Fixed costs: Managers salaries Rent Depreciation on equipment (straight-line, time basis) Other costs $16,000 14,500 9,300 5,700 Total variable costs Total fixed costs Total costs 32,000 28,000 12,000 7,000 Required: Suppose that Sophia expects to serve 20 percent more meals in the next quarter. Unit variable costs are expected to remain unchanged. However, Sophia knows that if the restaurant serves over 7,700 meals in a quarter, she must hire an additional manager (part-time) at a cost of $9,600 for the quarter. Other fixed costs are expected to increase by 10 percent. Calculate the unit cost and the total cost if 8,400 meals are served next quarter. (Round "Unit costs" answer to 2 decimal places.)
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