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FFSS > Chapter 7: Cost Control > Flashcards

Chapter 7: Cost Control Flashcards

1
Q

q1as a management function, deals with the measurement of current performance and guidance towards some predetermined goals

A

control

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2
Q

a process of making actual costs conform to a standard

A

cost control

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3
Q

defined as the prediction of the amount of money needed for a specific period of time

A

budget

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4
Q

type of budget

overall financial budget

ex: balance sheet, income statement

A

master budget

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5
Q

type of budget

forecast of sales activity and an estimate of costs that will be incurred in generating those sales

includes: revenues, expenses, changes in inventory, and other working capital items

A

operating budget

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6
Q

type of budget

based on set, predetermined level of activity or transactions

A

fixed budget

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7
Q

type of budget

reflects variability in performance activities

A

flexible budget

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8
Q

type of budget

identifies amount of cash on hand at any given time

A

cash budget

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9
Q

type of budget

allocates funds bases on efficiency and necessity rather than budget history

A

cash budget

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10
Q

type of budget

allocates funds bases on efficiency and necessity rather than budget history

A

zero-based budget

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11
Q

type of budget

predict costs of capital expenditures of long-term plan used to estimate

includes equipment replacement, renovation projects, and facility expansion

A

capital budget

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12
Q

pertains to resources expended in order to achieve an objective

A

cost

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13
Q

elements of cost are (3)

A

raw materials
labor
overhead

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14
Q

cost

expired, consumed, or utilized costs

A

expenses

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15
Q

cost

unaffected by change in business volume

A

fixed cost

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16
Q

cost

affected by change in business volume

A

variable cost

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17
Q

cost

affected by short-term plans and operational objectives

A

controllable cost

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18
Q

does not easily change over time, fixed cost

A

untcontrollable cost

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19
Q

cost

cost of goods and services agreed upon by the management

A

standard cost

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20
Q

cost

incurred costs of operation

A

actual cost

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21
Q

cost

can be traced directly to the product

A

direct cost

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22
Q

cost

cannot be traced directly on the product

A

indirect cost

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23
Q

cost

legitimate business cost

any activity that increases the variable cost or unexpectedly reduces sale that can reduce profit

A

hidden cost

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24
Q

defined as a set of rules or measures established in order to make comparisons and judgments

A

setting standards

25
Q

setting standards

defines the degree of acceptability of inputs, finished products, and work performance

A

quality

26
Q

setting standards

degree of acceptability based on weight, count, or volume

A

quantity

27
Q

setting standards

must be accurately determined to determine effectiveness of the operations

A

cost

28
Q

established methods and techniques for routine operations

A

procedures

29
Q

procedures established by the management must be followed for standardization purposes

A

training

30
Q

involves monitoring performance, discipling employees, and taking appropriate actions to correct deviations from standards

A

effective supervision and leadership

31
Q

provide information for decision-making

A

records and reports

32
Q

involves setting basic policy decisions

A

pre-operational control

33
Q

pre-operational control

concerned with the profitability of the company

A

financial policy

34
Q

pre-operational control

provision of satisfactory standards for the F&B according to target market, type of menu, methods of purchasing, food quality, type of service, and facilities design

A

catering policy

35
Q

involves built-in checks and technological and operational procedures covering the different stages of foodservice activities

A

operational control

36
Q

involves cost reporting, assessment of results, and taking corrective actions

A

post operational control

37
Q

percentage of total sales spent on food products

A

food cost

38
Q

cost distribution based on % of sales:

40-45%

A

food costs

39
Q

cost distribution based on % of sales:

30-35%

A

labor costs

40
Q

cost distribution based on % of sales:

10-15%

A

other expenses

41
Q

80-95%

A

total

42
Q

production control

the prediction of food needs for a day or other specific period of time

based on historical data

A

forecasting

43
Q

production control

measurable statements of aesthetic characteristics of food items

basis for sensory analysis of the prepared products

A

quality standards

44
Q

production control

yield percentage or yield factor is sued to determine how much of the food is lost as a result of processing

A

yield test

45
Q

production control - yield test

used to determine standard portion costs of meat items portioned before cooking

A

butcher test

46
Q

production control - yield test

used for items to be divided into portions after cooking to get portion cost

A

cooking loss test

47
Q

portion control

quantity of any item that is to be served each time that item is prepared or ordered

size per serving

formula: standard portion size = total weight of the product / no. of portions per unit

A

standard portion size

48
Q

portion control

calculated or planned cost

amount that a standard portion should cost given the standards and standard procedures for its production

standard portion cost = purchase price per unit/no. of portions per unit

A

standard portion cost

49
Q

done based on product, clientele, competitor, and supply vs demand

A

menu pricing

50
Q

menu pricing - cost-based pricing

cost of food + direct labor

A

prime cost

51
Q

menu pricing - cost-based pricing

overall cost + desired profit

A

average cost-plus profit

52
Q

menu pricing - cost-based pricing

includes profit percent

A

all cost-plus profit

53
Q

menu pricing - cost-based pricing

based on minimum charge

A

minimum sale pricing

54
Q

menu pricing - non-cost-based pricing

based on competitor’s price

A

competition pricing

55
Q

menu pricing - non-cost-based pricing

based on intuition, competitor’s pricing, or “follow the leader” pricing

A

traditional pricing

56
Q

labor cost formula

A

labor cost % = (labor cost/total sales) x 100

57
Q

costs other than food and labor

A

operating/overhead cost

58
Q

operating/overhead cost

utilities, laundry, repairs and maintenance, replacement, phone water, electricity, office supplies, and cleaning materials

A

operating costs

59
Q

operating/overhead cost

depreciation, rent or amortization, insurance, and taxes

A

fixed costs

FFSS (30 decks)

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