Business Case Studies & Business Publications

Wendy's Chili: A Costing Conundrum

Brownlee, E. Richa...

Case

Wendy's Chili: A Costing Conundrum

Brownlee, E. Richard II

C-2206 | Published July 27, 2005 | 11 pages Case

Collection: Darden School of Business

Product Details

This case poses the seemingly simple and straightforward question, "How much does it cost Wendy's to make a bowl of chili?" Because most of the meat used in making chili comes from overcooked hamburgers, however, a question of cost allocation arises. Wendy's is considering adding a salad bar to its "limited menu" and is wondering whether it should drop an existing product. Such a decision leads to an evaluation of present-product profitability.