ACCT6006SOL139 - 8. Award: 10.00 points Problems? Adjust...

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8.Award: 10.00 pointsProblems?Adjust creditfor all students.Cathy, the manager of Cathy’s Catering, Inc., uses activity­based costing to compute the costs of her catered parties.Each party is limited to 20 guests and requires four people to serve and clean up. Cathy offers two types of parties, anafternoon picnic and an evening formal dinner. The breakdown of the costs follows:Activities (and cost drivers)Afternoon PicnicFormal DinnerAdvertising (parties)$ 100 per party$ 100 per partyPlanning (parties)$75 per party$ 125 per partyRenting equipment$50 per party plus$75 per party plus(parties, guests)$10 per guest$20 per guestObtaining insurance (parties)$ 200 per party$ 400 per partyServing (parties, servers)$50 per server per party$75 per server per partyPreparing food (guests)$20 per guest$30 per guestPer party costs do not vary with the number of guests.Required:a.Compute the cost of a 20­guest afternoon picnic.
b.Compute the cost of a 20­guest evening formal dinner.
c.How much should Cathy charge for each guest for each type of party if she wants to cover her costs?(Round youranswers to 2 decimal places.)$$Charging AmountAfternoonpicnic61.25perguestFormal dinner100.00perguestExplanation:

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Term
One
Professor
N/A
Tags
Managerial Accounting, Harshad number, PlayStation Portable, Cathy, formal dinner

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