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The Wholesome Buffet offers an all-you-can-eat buffet meal for $25 per person. The restaurant employs ten salaried employees. Rent for the building, employee salaries,
The Wholesome Buffet offers an all-you-can-eat buffet meal for $25 per person. The restaurant employs ten salaried employees. Rent for the building, employee salaries, and other fixed costs for the restaurant are $191,800 per month when the restaurant serves meals up to 14,500 guests in that month. If the restaurant were to serve more than 14,500 guests in any given month, it would need to hire two additional servers and two additional kitchen staff for an additional fixed cost of $17,000 per month. The variable cost of food is $10 per guest Read the requirements. Requirement 1. What is the restaurant's cost equation for estimating costs if the number of guests to be served is up to 14,500 guests per month? 25 191,800 Requirement 2a. If the restaurant were to serve 13,700 guests in May, what would be the estimated total cost (Use the cost equation from Requirement 1.) If the restaurant were to serve 13,700 guests in May, the estimated total cost would be Requirement 2b. If the restaurant were to serve 13,700 guests in May, what would be the average cost per guest? If the restaurant were to serve 13,700 guests in May, the average cost per guest would be Requirement 3a. If the restaurant were to serve 12,000 guests in June, what would be the estimated total cost using the cost equation from Requirement 17 If the restaurant were to serve 12,000 guests in June, the estimated total cost using the cost equation from Requirement 1 would be Requirement 3b. If the restaurant were to serve 12.000 guests in June, what would be the estimated total cost using the average per quest cost from Requirement 2b? If the restaurant were to serve 12.000 guests in June, the estimated total cost using the average cost per guest from Requirement 2b would be Requirement 3e. Why is there a difference in the two cost estimates? There is a difference in the two cost estimates because the average cost per guest o decreases while the variable cost per unit as volume changes, due to the of the buffet's costs. The foxed cost per
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