The Peripheral Costing Model is divided into two columns.
One column lists steps 1 through 6. The other column lists the actions that must be taken during each stem.
Step 1: Create a list of all items offered at the beverage station.
Items:Coke SyrupMilk, 2%

Step 2: Inventory the beginning amounts of each item.
Beginning Inventory:Coke Syrup 13 gallons
2% Milk 22 gallons

Step 3: Add purchases for each item during the one week test period.
Add Purchases (from invoices):Coke Syrup 40 gallons
2% Milk 70 gallons

Step 4: Subtract unused amounts at the end of the week.
Subtract Ending Inventory:Coke Syrup 10 gallons
2% Milk 15 gallons
Step 5: Calculate item usage and costs to get total costs.Determine Usage: Coke Syrup 43 gallons at $5.70 = $245.102% Milk 77 gallons at $1.22 = $ 93.94

Step 6: Determine total meals served. Divide total meals into total costs to get peripheral cost per meal.
Total Cost Divided by Total Meals
$339.04 divided by 2511 Meals = $ .135 per meal