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Problem 8-19A More Than One Cost Driver [L08-2, L08-31 Milano Pizza is a small neighborhood...

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Accounting

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Problem 8-19A More Than One Cost Driver [L08-2, L08-31 Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offering take-out and free home delivery services. The pizzeria's owner has determined that the shop has two major cost drivers-the number of pizzas sold and the number of deliveries made. Data concerning the pizzeria's costs appear below: Fixed Cost Cost per Cost per per Month Pizza Delivery Pizza ingredients 4.30 Kitchen staff 6,110 Utilities 710 $0.30 Delivery person 3.10 730 Delivery vehicle 1.30 Equipment depreciation 480 2,070 Rent Miscellaneous 830 $0.15 In November the pizzeria budgeted for 1,860 pizzas at an average selling price of $17 per pizza and for 240 deliveries. Data concerning the pizzeria's operations in November appear below: Actual Results Pizzas 1.960 Deliveries 220 $33,970 Revenue Pizza ingredients 9,010 6,050 Kitchen staff Utilities 935 682 Delivery person 1,006 Delivery vehicle Equipment depreciation 480 2,070 Rent 850 Miscellaneous

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