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Concept introduction:
Order processing is the process involved in picking, packing and the delivery of products to the end users.
Requirement 1:
Activities which are indulged in processing the order of a sandwich and beverages with the time involved in getting a finished sandwich.
Concept introduction:
Order processing is the set of activities involved while delivering products or services to the end user.
Requirement 2:
To explain:
Common activities different activities which are involved in establishments.
Concept Introduction Order processing is the set of step by step process of delivering final products to the end users.
Requirement 3:
To explain:
Cost related to the number of activities related to the time and salary as per order processing.
Concept introduction:
Order processing is the set of activities which are indulged in serving the products and services.
Requirement 4:
To explain:
Suggestions to improve the process you are observing this question and deriving the cost indulged to perform such activities.
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Chapter 4 Solutions
MANAGERIAL ACCOUNTING FUND. W/CONNECT
- Hiram’s Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Activity Measure Total Cost Total Activity Serving a party of diners Number of parties served $19,800 6,000 parties Serving a diner Number of diners served $96,250 12,500 diners Serving drinks Number of drinks ordered $36750 10,500 drinks The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top-management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties…arrow_forwardCalculating and Interpreting Activity-Based Costing Data Hiram’s Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top-management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant’s tables, vary with the number of parties served. Other costs, such as washing plates and glasses, depend on the number of diners served or the number of drinks served. Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant.…arrow_forwardHiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served Total Activity 5,600 parties 12,100 diners 10,900 drinks Total Cost $ 15,120 $ 107, 690 $ 31,610 Number of drinks ordered The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs,…arrow_forward
- Hiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served i Number of drinks ordered Total Cost $ 33,000 $ 138,000 $ 24,000 Total Activity 6,000 parties 15,000 diners 10,000 drinks The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs,…arrow_forwardHiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served Number of drinks ordered Total Cost $ 12,240 $ 118,680 $ 27,040 The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such as washing plates and glasses, depend on the number of…arrow_forwardHiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served Number of drinks ordered Total Cost $ 14,250 $ 102,920 $ 29,700 Total Activity 5,700 parties 12,400 diners 11,000 drinks The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such…arrow_forward
- Hiram's Lakeside is a popular restaurant located on Lake Washington in Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student intern to conduct an activity-based costing study. The intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners. Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served Number of drinks ordered Total Cost $ 28,350 $ 113,160 $ 40,170 Total Activity 5,500 parties 12,300 diners 10,300 drinks The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such…arrow_forwardHiram's Lakeside is a popular restaurant located on Lake Washington In Seattle. The owner of the restaurant has been trying to better understand costs at the restaurant and has hired a student Intern to conduct an activity-based costing study. The Intern, in consultation with the owner, identified three major activities and then completed the first-stage allocations of costs to the activity cost pools. The results appear below. Activity Cost Pool Serving a party of diners Serving a diner Serving drinks Activity Measure Number of parties served Number of diners served Number of drinks ordered Total Cost $ 15,950 $ 112,800 $ 33,480 Total Activity 5,500 parties 12,000 diners 10,800 drinks The above costs include all of the costs of the restaurant except for organization-sustaining costs such as rent, property taxes, and top- management salaries. Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served. Other costs, such…arrow_forwardimplementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-sustaining activity. The following costs will be assigned using the activity-based costing system Driver and guard wages Vehicle operating expense Vehicle depreciation. Customer representative salaries and i expenses office expenses Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses office expenses Administrative expenses Administrative expenses Total cost The distribution of resource consumption across the activity cost pools is as follows. Pickup and Delivery 35% 5% $1,000,000 510,000 390,000 Driver and guard wages Vehicle…arrow_forward
- Durban Metal Products, Limited, of the Republic of South Africa makes speclalty metal parts used In applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for Internal decislon-making purposes. The company has four actlvity cost pools as listed below: Activity Rate $ 17.70 per direct labor-hour $ 358.08 per customer order $ 78.08 per testing hour $ 1,492.00 per sales call Activity Cost Pool Order size Activity Measure Number of direct labor-hours Customer orders Number of custoner orders Product testing Selling Number of testing hours Number of sales calls The managing director of the company would like Information concerning the cost of a recently completed order for heavy- duty traller axles. The order requlred 100 direct labor-hours, 17 hours of product testing, and 5 sales calls. Required: What Is the total overhead cost assigned to the order for heavy-duty traller axles? Activity Cost…arrow_forwardPlease solve the task by reading attached pictures of background knowledge. Christine wants to improve the profit situation of her company - and learn more about the profit per product for the past month. Christine is a follower of a full costing approach. Therefore all the costs should be allocated to the products. Perform this calculation by calculating three alternatives for the distribution of fixed overheads:? •Distribution in equal parts? •Distribution proportional to sales ? •Distribution proportional to sales. All three allocation keys are common allocation routes in practice. Which one should Christine prefer?arrow_forwardHow does activity-based costing differ from traditional costing systems? Can you please create a brief outline by identifying 1 or 2 examples of a restaurant using an ABC system at a customer level, group level, service level, and facility level? PLEASE BE ORIGINAL IN YOUR ANSWER.arrow_forward
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