A Restaurant Hires Cooks and Waiters $\quad$ $\quad$ $\quad$

question 13

Multiple Choice

A restaurant hires cooks and waiters.Cooks earn $10 an hour; waiters earn $5 an hour.The manager,who wants to maximize the number of meals served given a fixed payroll of $45 per hour,expects the following from cooks and waiters: $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Total wumber of meals seived }$
$\begin{array}{c}\begin{array}{c}\text {Number of employees}\\\hline 1\\2\\3\\4\\5\end{array}\begin{array}{c}\text {Cook}\\\hline200\\380\\540\\660\\740\end{array}\begin{array}{c}\text {Waiter's}\\\hline 120\\230\\310\\360\\390\end{array}\end{array}$
Given the above information,the manager should hire

• A)2 cooks and 4 waiters.
• B)2 cooks and 5 waiters.
• C)3 cooks and 2 waiters.
• D)3 cooks and 4 waiters.
• E)none of the above

Know which pronouncements are issued by FASB and their significance.

Understand the development and enforcement of accounting standards.

Distinguish between primary responsibilities of regulatory bodies in the U.S. financial reporting environment.

Comprehend the significance of notes to financial statements.

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Definitions:

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business.

Contribution Margin

The amount remaining from sales revenue after variable costs are deducted, indicating how much contributes to covering fixed costs and generating profit.

Pretax Income

The income earned by a business before any taxes have been deducted.

Target Pretax Income

The income a company aims to achieve before deducting taxes, often set for budgeting or goal-setting purposes.