Ambassador Suites Inc., operates a downtown hotel property that has 300 rooms. On average, 80% of Ambassador Suites's rooms are occupied on weekdays, and 40% are occupied during the weekend. The manager has asked you to develop a direct labor budget for the housekeeping and restaurant staff forweekdays and weekends. You have determined that the housekeeping staff requires 40 minutes to clean each occupied room. The housekeeping staff is paid $10 per hour. The restaurant has 6 full-time staff (eight-hour day) on duty, regardless of occupancy. However, for every 20 occupied rooms, an additionalperson is brought in to work in the restaurant for the eight-hour day. The restaurant staff is paid $8 per hour.Determine the estimated housekeeping, restaurant, and total direct labor cost for an average weekday and average weekend day. Enter percentages as whole numbers.Ambassador Suites Inc.Direct Labor Cost BudgetFor a Weekday or a Weekend DayWeekdayWeekend DayRoom occupancyRoom capacityOccupied percent%XRooms occupiedHousekeepingNumber of minutes to clean a roomTotal minutesTotal hoursLabor rate per hourX$X$Housekeeping daily labor budget2$Restaurant staffBase restaurant staffIncremental 20 room blocksTotal staffHours per dayTotal hoursLabor rate per hourX$X$Restaurant staff daily labor budget$4Total daily labor budget

bassador Suites Inc., operates a downtown hotel property that has 300 rooms. On average, 80% of Ambassador Suites's rooms are occupied on weekdays, and 40% are occupied during the weekend. The manager has asked you to develop a direct labor budget for the housekeeping and restaurant sta ekdays and weekends. You have determined that the housekeeping staff requires 40 minutes to clean each occupied room. The housekeeping staff is paid $10 per hour. The restaurant has 6 full-time staff (eight-hour day) on duty, regardless of occupancy. However, for every 20 occupied rooms, an ade son is brought in to work in the restaurant for the eight-hour day. The restaurant staff is paid $8 per hour. termine the estimated housekeeping, restaurant, and total direct labor cost for an average weekday and average weekend day. Enter percentages as whole numbers. Ambassador Suites Inc. Direct Labor Cost Budget For a Weekday or a Weekend Day Weekday Weekend Day Dom occupancy oom capacity ccupied percent poms occupied ousekeeping umber of minutes to clean a room X otal minutes otal hours abor rate per hour ousekeeping daily labor budget estaurant staff ase restaurant staff ncremental 20 room blocks otal staff ours per day ptal hours

bassador Suites Inc., operates a downtown hotel property that has 300 rooms. On average, 80% of Ambassador Suites's rooms are occupied on weekdays, and 40% are occupied during the weekend. The manager has asked you to develop a direct labor budget for the housekeeping and restaurant sta ekdays and weekends. You have determined that the housekeeping staff requires 40 minutes to clean each occupied room. The housekeeping staff is paid $10 per hour. The restaurant has 6 full-time staff (eight-hour day) on duty, regardless of occupancy. However, for every 20 occupied rooms, an ade son is brought in to work in the restaurant for the eight-hour day. The restaurant staff is paid $8 per hour. termine the estimated housekeeping, restaurant, and total direct labor cost for an average weekday and average weekend day. Enter percentages as whole numbers. Ambassador Suites Inc. Direct Labor Cost Budget For a Weekday or a Weekend Day Weekday Weekend Day Dom occupancy oom capacity ccupied percent poms occupied ousekeeping umber of minutes to clean a room X otal minutes otal hours abor rate per hour ousekeeping daily labor budget estaurant staff ase restaurant staff ncremental 20 room blocks otal staff ours per day ptal hours

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter17: Activity Resource Usage Model And Tactical Decision Making

Section: Chapter Questions

Problem 6E: Elliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of...

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Elliott, 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?
Alard 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. 32,000
Ambassador Suites Inc. operates a downtown hotel property that has 300 rooms. On average, 80% of Ambassador Suites' rooms are occupied on weekdays, and 40% are occupied during the weekend. The manager has asked you to develop a budget for the housekeeping and restaurant staff for weekdays and weekends. You have determined that the housekeeping staff requires 30 minutes to clean each occupied room. The housekeeping staff is paid $15 per hour. The housekeeping labor cost is fully variable to the number of occupied rooms. The restaurant has six full-time staff on duty to staff the restaurant for breakfast and lunch (eight hours), regardless of occupancy. However, for every 60 occupied rooms, an additional person is brought in to work in the restaurant for breakfast and lunch (eight hours). The restaurant staff is paid $13 per hour. Prepare two columns, labeled as weekday and weekend day. a. Determine the number of rooms occupied for an average weekday and weekend day. b. Determine…
Rachael's Restaurant, a fast-food restaurant company, operates a chain of restaurants across the nation. Each restaurant employs eight people; one is a manager paid a salary plus a bonus equal to 4 percent of sales. Other employees, two cooks, one dishwasher, and four servers, are paid salaries. Each manager is budgeted $3,000 per month for advertising costs. Required Classify each of the following costs incurred by Rachael's Restaurant as fixed, variable, or mixed: a. Advertising costs relative to the number of customers for a particular restaurant. Fixed cost b. Rental costs relative to the number of restaurants. Variable cost c. Cooks' salaries at a particular location relative to the number of customers. Fixed cost d. Cost of supplies (cups, plates, spoons, etc.) relative to the number of customers. e. Manager's compensation relative to the number of customers. Variable cost Mixed cost f. Servers' salaries relative to the number of restaurants. Variable cost
Seal Financial Advisors provides accounting and finance assistance to customers in the retail business. Seal has four professionals on staff and an office with six clerical staff. Total compensation, including benefits, for the professional staff runs about $573,000 per year, and normal billable hours are 8,300 hours per year. The professional staff keep detailed time sheets organized by client number. The total office and administrative costs for the year are $755,000. Seal allocates office and administrative costs to clients monthly, using a predetermined overhead allocation rate based on billable hours. What is the predetermined overhead allocation rate that Seal will use for office and administrative costs? (Round your answer to the nearest cent.) A. $69.04 per hour B. $21.93 per hour C. $160.00 per hour D. $90.96 per hour
Elliott, 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. Which of the resources associated with purchasing can be classified as flexible resources? Forms, Postage and Supplies Which of the resources associated with purchasing can be classified as committed resources? PC system and clerks 2. Compute the total activity availability, and break this into activity usage and unused activity. Activity availability: fill in the blank 3 purchase orders Activity usage: fill in the blank…
Ambassador Suites Inc. operates a downtown hotel property that has 300 rooms. On average, 80% of Ambassador Suites’ rooms are occupied on weekdays and 40% are occupied during the weekend. The manager has asked you to develop a direct labor budget for the housekeeping and restaurant staff for weekdays and weekends. You have determined that the housekeeping staff requires 30 minutes to clean each occupied room. The housekeeping staff is paid $14 per hour. The housekeeping labor cost is fully variable to the number of occupied rooms. The restaurant has six full-time staff (eight-hour day) on duty, regardless of occupancy. However, for every 60 occupied rooms, an additional person is brought in to work in the restaurant for the eight-hour day. The restaurant staff is paid $12 per hour. Determine the estimated housekeeping, restaurant, and total direct labor cost for an average weekday and average weekend day. Format the budget in two columns, labeled as weekday and weekend day. Enter…
Bobby's Inc. operates a chain of restaurants across North Carolina. Each restaurant employs ten people; one is a manager paid a salery plus a bonus equal to 2 percent of sales. Other employees three cooks, one dishwasher, and five servers, are paid salaries. Each manager is budgeted $4,000 per month for advertising costs. Required Classify each of the following costs incurred by Bobby's Inc. as fixed, variable, or mixed: a Advertising costs relative to the number of customers for a particular restaurant. b. Rental costs relative to the number of restaurants c. Cooks' salaries at a particular location relative to the number of customers. Cost of supplies (cups, plates, spoons, etc.) relative to the number of customers. Manager's compensation relative to the number of customers. Servers salaries relative to the number of restaurants.
The direct cost of each hotel guest at Seaview hotel is $15 per night. The hotel manager has estimated that the average overhead cost per guest is $10 per night, based on 100 guest nights per week. The room price is $50 per night. A large group of 50 people have asked to spend one night at the hotel during a week when only 30 other guests are booked. The group of 50 has offered to pay a price of $20 each. Discuss whether the manager should accept the offer.
Sunland Horticulture provides and maintains live plants in office buildings. The company's 884 customers are charged $37 per month for this service, which includes weekly watering visits. The variable cost to service a customer's location is $17 per month. The company incurs $2,194 each month to maintain its fleet of four service vans and $3.004 each month in salaries. Sunland pays a bookkeeping service $2 per customer each month to handle all invoicing and accounting functions A.) picture one B.) What is the expected monthly operating income if 174 customers are added? Operating income $________ C.) second picture
Elliott, 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…
Sharp Motor Company has two operating divisions-an Auto Division and a Truck Division. The company has a cafeteria that serves the employees of both divisions. The costs of operating the cafeteria are budgeted at $88,000 per month plus $0.50 per meal served. The company pays all the cost of the meals. The fixed costs of the cafeteria are determined by peak-period requirements. The Auto Division is responsible for 61% of the peak-period requirements, and the Truck Division is responsible for the other 39%. For June, the Auto Division estimated it would need 91,000 meals served, and the Truck Division estimated it would need 61,000 meals served. However, due to unexpected layoffs of employees during the month, only 61,000 meals were served to the Auto Division. Another 61,000 meals were served to the Truck Division as planned. The cafeteria's actual fixed costs for June totaled $92,000 and its actual meal costs totaled $76,000. Required: 1. How much cafeteria cost should be charged to…