Question: Seneca Cafeteria Operations (SCO) formerly collected from each customer as they reached the end of the food line. A cashier, seated at a cash register,

Seneca Cafeteria Operations (SCO) formerly collected from each customer as they reached the end of the food line.  A cashier, seated at a cash register, rang up the amount (displayed on a digital screen) and collected the money.  Management changed the system, and now a clerk at the end of the line operates a calculator/printer machine and gives each customer a paper tape.  The machine accumulates a running total internally.  The customer presents the tape at the cash register on the way out and pays.  The SCO manager justified the direct cost of $10,000 annually for the added salary and $500 for the new machine by pointing out that 4 more people each weekday (Monday to Friday) and 10 more people on weekends could be served.  The food line now moves faster and customers are happier.  The average meal costs $12.  The total cost of food and service can be considered to be fixed. 

 

What is the first year net benefit of the change?

 

(place answer in space provided without $ sign)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

To calculate the firstyear net benefit of the change we need to determ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!