The Prices Quoted on the Menu of an Upscale Restaurant

question 166

True/False

The prices quoted on the menu of an upscale restaurant all end in zeros. This approach is a way the restaurant can signal to its customers that the food it serves is a real bargain.

---

Definitions:

Manufacturing Overhead

The indirect factory-related costs that are incurred when producing a product.

Total Manufacturing Costs

The sum of all expenses directly associated with the production of goods, including direct labor, direct materials, and manufacturing overhead.

Predetermined Overhead Rate

Predetermined Overhead Rate is a rate calculated before a period begins, used to allocate estimated overhead costs to products or job orders based on a selected activity base.

Annual Overhead Costs

Refers to the total expenses that are not directly tied to a specific product or service but are required for the business to operate, accumulated over a year.