Visit and observe the processes of three different fast-food restaurants-these visits can be done as individuals or as teams. The objective of activity-based costing is to accurately assign costs to products and to improve operational efficiency.

Required

1. Individuals (or teams) can be assigned to each of three different fast-food establishments. Make a list of the activities required to process an order of a sandwich, beverage, and one side-order at each restaurant. Record the time required for each process, from placing the order to receiving the completed order.

2. What activities do the three establishments have in common? What activities are different across the establishments?

3. Is the number of activities related to the time required to process an order? Is the number of activities related to the price charged to customers? Explain both.

4. Make recommendations for improving the processes you observe. Would your recommendations increase or decrease the cost of operations?