7 Case Study ThreeYou are the Revenue Manager of Fresh Wave Resort. The resort has 280 rooms and two restaurants (La Padella andGolden Greek) for 400 people. After the annual meeting, the owners of Fresh Wave Resort are concerned aboutrunning those two restaurants continuously and request you to review and evaluate the performance of therestaurants from last month, May.• La Padella and Golden Greek has 200 seats, respectively.• La Padella is open from 12 - 10pm and Golden Greek is open from 11am - 10pm.May's Income ReportLa PadellaGolden Greek27,890Number of Covers Served26,470F&B Revenue$1,482,135.00$1,353,593.00Cost of F&B Sales$302,780.00$265,282.00Salaries & Wages$199,625.00$211,329.00Required1) Given the above information, which restaurant would you suggest the owners to continue running and why? Youranswer must be supported with appropriate performance metrics and should include the rationale for your decision.Then, 2) suggest two (2) strategies to increase the profits of the restaurant.3) The owners of Fresh Wave Resort are also concerned about the function space and request that you liaise withsales and marketing to review strategies to increase function sales and venue bookings. Using the price/value map asbelow, do you agree with the owners or can you suggest an alternative strategy to present? You should justify yourresponse by referring to the price/value map and relevant revenue management principles.

The company should continue that section or product or the service of the overall products which are…

1) Given the above information, which restaurant would you suggest the owners to continue running and why? Your answer must be supported with appropriate performance metrics and should include the rationale for your decision. Then, 2) suggest two (2) strategies to increase the profits of the restaurant. 3) The owners of Fresh Wave Resort are also concerned about the function space and request that you liaise with cales and marketing to review strategies to increase function sales and venue bookings Heing the pricelaluo man ac

1) Given the above information, which restaurant would you suggest the owners to continue running and why? Your answer must be supported with appropriate performance metrics and should include the rationale for your decision. Then, 2) suggest two (2) strategies to increase the profits of the restaurant. 3) The owners of Fresh Wave Resort are also concerned about the function space and request that you liaise with cales and marketing to review strategies to increase function sales and venue bookings Heing the pricelaluo man ac

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter2: Financial Statements And The Annual Report

Section: Chapter Questions

Problem 2.1AP

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Cost Identification and Analysis, Cost Assignment, Income Statement Melissa Vassar has decided to open a printing shop. She has secured two contracts. One is a 5-year contract to print a popular regional magazine. This contract calls for 5,000 copies each month. The second contract is a 3-year agreement to print tourist brochures for the state. The state tourist office requires 10,000 brochures per month. Melissa has rented a building for 1,400 per month. Her printing equipment was purchased for 40,000 and has a life expectancy of 20,000 hours with no salvage value. Depreciation is assigned to a period based on the hours of usage. Melissa has scheduled the delivery of the products so that two production runs are needed. In the first run, the equipment is prepared for the magazine printing. In the second run, the equipment is reconfigured for brochure printing. It takes twice as long to configure the equipment for the magazine setup as it does for the brochure setup. The total setup costs per month are 600. Insurance costs for the building and equipment are 140 per month. Power to operate the printing equipment is strongly related to machine usage. The printing equipment causes virtually all the power costs. Power costs will run 350 per month. Printing materials will cost 0.40 per copy for the magazine and 0.08 per copy for the brochure. Melissa will hire workers to run the presses as needed (part-time workers are easy to hire). She must pay 10 per hour. Each worker can produce 20 copies of the magazine per printing hour or 100 copies of the brochure. Distribution costs are 500 per month. Melissa will receive a salary of 1,500 per month. She is responsible for personnel, accounting, sales, and productionin effect, she is responsible for administering all aspects of the business. Required: 1. What are the total monthly manufacturing costs? 2. What are the total monthly prime costs? What are the total monthly prime costs for the regional magazine? For the brochure? 3. What are the total monthly conversion costs? Suppose Melissa wants to determine monthly conversion costs for each product. Assign monthly conversion costs to each product using direct tracing and driver tracing whenever possible. For those costs that cannot be assigned using a tracing approach, you may assign them using direct labor hours. 4. Melissa receives 1.80 per copy of the magazine and 0.45 per brochure. Prepare an income statement for the first month of operations.
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