Question

Describe all business activities from the time a customer arrives to the time that customer departs your favorite fast-food restaurant. Observe its business operations.
Required
1. Describe all business activities from the time a customer arrives to the time that customer departs.
2. List all costs you can identify with the separate activities described in part 1.
3. Classify each cost from part 2 as fixed or variable, and explain your classification.

Answer 1

Answer: The answer is provided below

Explanation:

1. The following are the business activities that takes place from the moment a customer arrives to the moment the customer leaves my favorite fast-food restaurant.

The first thing is welcoming the customer to the restaurant, after the customer sits down, a waiter for to the customer and gives the menu to the customer for him or her to choose the kind of meal he or she wants. After the customer has chosen the meal, the order is received and then filled. The food is then brought to the customer with an accompanying bill for the customer to make payment. Lastly, when the customer has finished eating, the waiter and security at the gate thanks him or her on their way out.

2. The costs are:

i. The salary of the staffs at the restaurant. This include the waiter, cook, security, manager, cleaners etc.

ii. Utility bills such as electricity and water.

iii. Rent of the building.

iv. Cost of the ingredients for the meals.

3. Fixed cost is a cost which doesn't vary with the production output while variable costs are the costs that varies with output. For the (ii) above, the fixed costs are: salary of staffs, rent, utility bills because these costs doesn't usually change while the variable cost is the cost of the ingredients for the meals.