Question

Jennifer Norton is the Registered Dietitian (R.D.) responsible for all dietary services at City Memorial Hospital. Her operation consists of two departments. The first, and largest, is patient feeding. It consists of the tray line staff and the majority of her food production staff. The second department is the public cafeteria, which includes special dining areas for staff and a large dining area for patient visitors. Annually, on January 1, she submits to her supervisor an annual labor expense budget broken down by month for each department.In June, and after four months of consideration and planning, Jennifer and her staff were excited to implement a new cafeteria menu. The response from the public was excellent. The dining room staff reported that there were many positive comments about the food selected for the new menu, and the production staff reported a 25% increase in the amount of food prepared for cafeteria service.On July 7, when Jennifer's assistant, Joe, brought her the financial reports for the month of June, he was quite agitated. "I think we are in trouble Boss," he said. "As I read the reports, we were over our labor budget by more than $3,000 last month! How did that happen?"Jennifer reviewed the labor portion of the budget and found the following:

June Budget ($) June Actual ($) Patient labor Cafeteria labor
23,750 23,824 16,500 19,850

1. What do you think is the cause of Jennifer's labor budget overages? How would you determine if you are correct?

Answer 1

Jennifer's labor budget overages are likely due to increased staff workload from the new cafeteria menu, requiring additional labor hours. Confirming this would involve reviewing staffing patterns, costs, and productivity before and after the new menu implementation.

Step-by-step explanation:

The cause of Jennifer's labor budget overages is likely due to increased labor costs associated with the new cafeteria menu. A 25% increase in food preparation often requires additional labor. To confirm the cause, Jennifer should review labor hours and staffing patterns before and after the menu change, compare the costs of new menu items, and the productivity of the staff in terms of the speed and efficiency of food preparation.

Additionally, she should investigate if there were any overtime hours worked due to the change or any unrelated factors like staff shortages or unexpected events. After gathering this information, Jennifer can analyze if the increased labor expenses align with the revenue generated by the new menu, and assess if temporary overages may be justified by long-term gains in cafeteria income and customer satisfaction.

Answer 2

Jennifer Norton's labor budget overages are probable due to the increased demand following the introduction of the new cafeteria menu, leading to a higher workload and consequently more labor hours.

Step-by-step explanation:

The cause of Jennifer's labor budget overages is likely linked to the new cafeteria menu implemented in June. The positive response from the public probably resulted in an increased volume of customers, which in turn led to a 25% increase in food preparation. The additional demand meant more work for the production staff and possibly more hours needed from the dining room staff to serve the growing number of customers. To confirm this as the cause of the budget overage, Jennifer should review labor hour reports and production volumes to pinpoint direct correlations between the menu change, increased customer volume, and labor costs. Moreover, if the increase in labor cost resulted in proportional or greater revenue from the cafeteria, this budget overage might still be economically viable.