2-2 Final Project Milestone Three Cost of Production & Overall Market.docx - 1 Running head MCDONALD\u2019S McDonald\u2019s Carmen Concepcion Southern New

2-2 Final Project Milestone Three Cost of Production & Overall Market.docx

This preview shows page 1 - 3 out of 5 pages.

1 Running head: MCDONALD’S McDonald’s Carmen Concepcion Southern New Hampshire University ECO 201
Image of page 1
2 Cost of Production McDonald’s operating costs and expenses are like many of the fast food restaurants. Most of McDonald’s cost comes from food & paper, wages and rents. What follows is the cost structure breakdown average for the past 5 years: 17% on Wages 21% on Food & Paper 22% on Rents (includes Franchised restaurants, occupancy expenses) 9% on Selling, general & administrative expenses McDonald’s cost structure consists of both fixed costs and variables. The fixed costs are: utilities, salary workers, machinery, franchise fees, and rents. The variables are: wage workers, food & paper, marketing and taxes. Fixed costs are expenses that don’t change regardless what the revenue is. Variables can change dependent on the suppliers whether they raise or lower prices, workers hired or fired, taxes rising and marketing prices going up or down. The
Image of page 2
Image of page 3

You've reached the end of your free preview.

Want to read all 5 pages?

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes