Reference no: EM132755997

As global economies re-open in the aftermath of major country-wide lockdowns, businesses are being forced to re-evaluate how they conducted business in the past. One of the areas being scrutinised even more than before is their expenses and overheads. It is wildly believed that lean organisations have a better chance at surviving the current economic conditions, unless vaccines are developed.

• A few months ago, these vaccines did not have definite dates or definite success rates. However, Pfizer recently published that their best vaccine candidate has a success rate of 90 percent. This has bolstered business confidence overnight, across many industries. The latter has woken up the ailing restaurant sector, with renewed vigour in many areas i.e. cost restructures are now of dire importance & are being fast tracked.

• As a result, your local Indian restaurant has decided to adopt an activity-based costing system to estimate the cost of the various courses that are currently being performed here. However, there are questions about whether an activity-based costing system has any demonstrable merit over traditional "top-to-bottom" budgeting processes.

Required:

Problem 1) Identify the principal activities that are carried on by employees in the restaurant

Problem 2) Make a few suggestions as to the potential activity drivers for each of these processes.