Panera Bread Company (PNRA) operates over 2,000 bakery-cafe locations throughout the United States and Canada and serves over 9 million customers per week. Panera’s operations are divided into the following segments:
- Company-Operated Bakery-Cafes
- Franchised Bakery-Cafes
- Fresh Dough and Other Products
The Fresh Dough and Other Products segment supplies fresh dough, produce, tuna, and other products to the company-operated and franchised cafes. Recent data (in millions) for each of these segments are as follows:
- a. Determine the profit margin for each segment. Round to one decimal place.
- b. Determine the investment turnover for each segment. Round to two decimal places.
- c. Use the DuPont formula to determine the
return on investment for each segment. Round to one decimal place. - d. Which segment has the highest profit margin, investment turnover, and return on investment? Explain why.
- e. If franchised cafes are more profitable, why would Panera operate company- owned cafes?
MAD 24-3 Analyze Papa John’s International, Inc. Obj. 6
Papa John’s International, Inc. (PZZA), operates over 5,000 restaurants in the United States and 45 countries. The company operates primarily as a franchisor with 4,353 franchised restaurants and 744 company-operated restaurants. Recent data (in millions) for the company-operated and North America franchised restaurants are as follows:
- a. Determine the profit margin for each segment. Round to one decimal place.
- b. Determine the investment turnover for each segment. Round to two decimal places.
- c. Use the DuPont formula to determine the return on investment for each segment. Round to one decimal place.
- d. Analyze and interpret the results of (a), (b), and (c).
MAD 24-4 Compare Panera Bread and Papa John’s Obj. 6
Compare Panera Bread (PNRA) and Papa John’s (PZZA) using your computations from MAD 24-2 and MAD 24-3.
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Managerial Accounting
- Panera Bread Company (PNRA) operates over 2,000 bakery-cafe locations throughout the United States and Canada and serves over 9 million customers per week. Paneras operations are divided into the following segments: Company-Operated Bakery-Cafes Franchised Bakery-Cafes Fresh Dough and Other Products The Fresh Dough and Other Products segment supplies fresh dough, produce, tuna, and other products to the company-operated and franchised cafes. Recent data (in millions) for each of these segments are as follows: a. Determine the profit margin for each segment. Round to one decimal place. b. Determine the investment turnover for each segment. Round to two decimal places. c. Use the DuPont formula to determine the return on investment for each segment. Round to one decimal place. d. Which segment has the highest profit margin, investment turnover, and return on investment? Explain why. e. If franchised cafes are more profitable, why would Panera operate company- owned cafes?arrow_forwardElliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of 25,750 and is capable of processing as many as 6,500 purchase orders per year. Each clerk uses a PC and laser printer in processing orders. Time available on each PC system is sufficient to process 6,500 orders per year. The cost of each PC system is 1,100 per year. In addition to the salaries, Elliott spends 27,560 for forms, postage, and other supplies (assuming 26,000 purchase orders are processed). During the year, 25,350 orders were processed. Required: 1. Classify the resources associated with purchasing as (1) flexible or (2) committed. 2. Compute the total activity availability, and break this into activity usage and unused activity. 3. Calculate the total cost of resources supplied (activity cost), and break this into the cost of activity used and the cost of unused activity. 4. (a) Suppose that a large special order will cause an additional 500 purchase orders. What purchasing costs are relevant? By how much will purchasing costs increase if the order is accepted? (b) Suppose that the special order causes 700 additional purchase orders. How will your answer to (a) change?arrow_forwardAulman Inc. has a number of divisions including a Furniture Division and a Motel Division. The Motel Division owns and operates a line of budget motels located along major highways. Each year, the Motel Division purchases furniture for the motel rooms. Currently, it purchases a basic dresser from an outside supplier for $60. The manager of the Furniture Division has approached the manager of the Motel Division about selling dressers to the Motel Division. The full product cost of a dresser is $29. While the Furniture Division has been operating at capacity (50,000 dressers per year) and selling them for $60 each, it expects to produce and sell only 40,000 dressers for $60 each next year. The Furniture Division incurs variable costs of $16 per dresser. The Motel Division needs 10,000 dressers per year; the Furniture Division can make up to 50,000 dressers per year. The company policy is that all transfer prices are negotiated by the divisions involved. Required: 1. What is the maximum…arrow_forward
- Unilever’s products are sold in over 190 countries, and according to the company’s annual report, roughly 2 billion customers worldwide use Unilver products on any given day. Those stats put Unilever in an elite group of companies that own the most brands across the globe. Though best known for its iconic Pepsi soda, PepsiCo has expanded past its soft drink roots, offering some of the most popular snack food brands. The company’s top snacks include Doritos, Cheetos, Tostitos, Fritos, Lay’s, Ruffles, Stacy’s, Sabra, and muller. Unilever understand that brands are intangible asset of the company but wondering how to record all internally developed brands in its financial statements - at market value or at original cost? Please advise to the Unilever managementarrow_forwardHARDA Limited employs 650 workers in ten different departments. These workers work in various capacities, including the manufacturing workers, technician, and janitorial workers. Each department has a supervisor who is responsible for supervising departmental activities. In addition to supervising operations, the supervisors of the departments are responsible for recruiting, hiring, and firing workers within their areas of responsibility. The organization attracts casual labour and experiences a 20 to 30 per cent turnover rate in employees per year. Employees clock on and off the job each day to record their attendance on time cards. Each department has its clock machine located in an unattended room away from the main production area. Each week, the supervisors gather the time cards, review them for accuracy, and sign and submit them to the payroll department for processing. Besides, the supervisors submit personnel action forms to reflect newly hired and terminated employees. From…arrow_forwardElliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of$25,750 and is capable of processing as many as 6,500 purchase orders per year. Each clerk usesa PC and laser printer in processing orders. Time available on each PC system is sufficient toprocess 6,500 orders per year. The cost of each PC system is $1,100 per year. In addition to thesalaries, Elliott spends $27,560 for forms, postage, and other supplies (assuming 26,000 purchaseorders are processed). During the year, 25,350 orders were processed.Required:1. Classify the resources associated with purchasing as (1) flexible or (2) committed.2. Compute the total activity availability, and break this into activity usage and unused activity.3. Calculate the total cost of resources supplied (activity cost), and break this into the cost ofactivity used and the cost of unused activity.4. (a) Suppose that a large special order will cause an additional 500 purchase orders. Whatpurchasing costs are…arrow_forward
- Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid 28,000 per year and is able to process 4,000 purchase orders. Last year, 17,800 purchase orders were processed by the five agents. Required: 1. Calculate the activity rate per purchase order. 2. Calculate, in terms of purchase orders, the: a. total activity availability b. unused capacity 3. Calculate the dollar cost of: a. total activity availability b. unused capacity 4. Express total activity availability in terms of activity capacity used and unused capacity. 5. What if one of the purchasing agents agreed to work half time for 14,000? How many purchase orders could be processed by four and a half purchasing agents? What would unused capacity be in purchase orders?arrow_forwardPapa Johns International, Inc. (PZZA), operates over 5,000 restaurants in the United States and 45 countries. The company operates primarily as a franchisor with 4,353 franchised restaurants and 744 company-operated restaurants. Recent data (in millions) for the company-operated and North America franchised restaurants are as follows: a. Determine the profit margin for each segment. Round to one decimal place. b. Determine the investment turnover for each segment. Round to two decimal places. c. Use the DuPont formula to determine the return on investment for each segment. Round to one decimal place. d. Analyze and interpret the results of (a), (b), and (c).arrow_forwardTruGreen is the worlds largest lawn and landscape company, employing over 10,000 employees and serving more than 1.7 million customers. The Pawtucket Red Sox is a minor league baseball affiliate of the Boston Red Sox. The teams current roster consists of 25 active players, along with the teams manager, coaches, and mascots. Hock It To Me is a privately owned pawn shop. The company has annual revenue of less than 500,000 and employs a staff of one to four people. Even though each of these businesses has a unique payroll due to different amounts of salaries or wages, benefits, and withholdings, explain why each business needs to (a) accurately calculate the amount of payroll for each employee, (b) determine the amount of payroll taxes for which the employer is liable, (c) make the payroll tax deposits as required, and (d) file the appropriate payroll tax returns on a timely basis.arrow_forward
- Ingles Corporation is a manufacturer of tables sold to schools, restaurants, hotels, and other institutions. The table tops are manufactured by Ingles, but the table legs are purchased from an outside supplier. The Assembly Department takes a manufactured table top and attaches the four purchased table legs. It takes 16 minutes of labor to assemble a table. The company follows a policy of producing enough tables to ensure that 40 percent of next months sales are in the finished goods inventory. Ingles also purchases sufficient materials to ensure that materials inventory is 60 percent of the following months scheduled production. Ingless sales budget in units for the next quarter is as follows: Ingless ending inventories in units for July 31 are as follows: Required: 1. Calculate the number of tables to be produced during August. 2. Disregarding your response to Requirement 1, assume the required production units for August and September are 2,100 and 1,900, respectively, and the July 31 materials inventory is 4,000 units. Compute the number of table legs to be purchased in August. 3. Assume that Ingles Corporation will produce 2,340 units in September. How many employees will be required for the Assembly Department in September? (Fractional employees are acceptable since employees can be hired on a part-time basis. Assume a 40-hour week and a 4-week month.) (CMA adapted)arrow_forwardDarden Restaurants, Inc. (DRI) is the largest full-service restaurant company in the world. It operates over 2,200 restaurants under a variety of brand names, including Olive Garden, Bahama Breeze, and LongHorn Steakhouse. Panera Bread Company (PNRA) operates over 1,800 bakery-caf locations across North America. It is one of the largest food service companies in the United States. The cost of food, beverage, and packaging and the beginning and ending inventory balances from recent annual reports for Darden and Panera are as follows (in millions): a. Compute the inventory turnover for both companies. Round calculations to one decimal place. b. Compute the number of days sales in inventory for both companies. Round calculations to one decimal place. c. Which company is more efficient in managing inventory? d. What might explain the difference in the inventory management efficiency of the two companies?arrow_forwardAlard Manufacturing Company has a billing department staffed by four billing clerks. Each clerk is paid 32,000 per year and is able to process 8,000 bills. Last year, 27,360 bills were processed by the four agents. Calculate the unused capacity in terms of number of bills. a. 27,360 b. 4,640 c. 8,000 d. 32,000arrow_forward
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