Question

Danilo and his wife operate a restaurant where they sell all their meals for $14.00 each. The markup on each meal is $4.00 and overhead expenses are 19.00% of selling price. How much does it cost them to make each meal?

Answer 1

The cost to make each meal at Danilo's restaurant is calculated by subtracting the markup ($4.00) and the overhead expenses (19.00% of selling price, which is $2.66) from the selling price ($14.00). Therefore, it costs $7.34 to make each meal.

Step-by-step explanation:

To calculate the cost to make each meal at Danilo's restaurant, we need to take into account the selling price, the markup, and the overhead expenses. The selling price of each meal is $14.00. The markup on each meal is given as $4.00, which is the amount added to the cost to make the meal to arrive at the selling price.

Overhead expenses are 19.00% of the selling price. We can calculate the overhead expenses cost for each meal by converting the percentage to a decimal and multiplying it by the selling price: 0.19 × $14.00 = $2.66.

Now let's find the cost to make each meal by subtracting the markup and overhead expenses from the selling price:

• Selling price: $14.00
• Minus markup: - $4.00
• Minus overhead expenses: - $2.66
• Cost to make each meal: $14.00 - $4.00 - $2.66 = $7.34

Therefore, the cost of producing each meal is $7.34.