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FN 133 LE2 > Module 4 > Flashcards

Module 4 Flashcards

1
Q

It is in this stage of meeting labor costs % targets that the actual and projected costs are compared

A

Evaluation stage

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2
Q

Ratio of one item’s profit contribution compared to the total profit contribution of all items sold within one menu category

A

Menu Profitability Analysis (Contribution Margin)

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3
Q

Give the formula for food cost

A

Cost of Food Sold = Total Food Available (Opening Inventory + Purchase) Minus Closing Inventory

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4
Q

Pertains to debts that will have to be paid off during the current fiscal period (<= 1 year)

A

Current liabilities

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5
Q

Based on profitability and popularity, which items should continue promotions? Where are these located in the graph?

A

Star (upper right quadrant)

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6
Q

Formula of selling price if item is sold as one dish

A

Selling Price = (RFC + % Hidden Loss) X Computed Mark-up

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7
Q

Food and beverages are examples of what type of cost

A

food cost

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8
Q

Based on popularity and profitability, what food item should be removed if it does not influence sales of other items? Which part of the graph is this on?

A

Dog (Lower left quadrant)

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9
Q

Two parameters covered by job analyses

A

Job descriptions
Job specifications

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10
Q

What tool is used in step 1: Collect accurate sales and cost data?

A

income statement

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11
Q

Two types of liabilities

A

Current liabilities
Long term liabilities

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12
Q

This reflects the demand for food items

A

Menu popularity analysis

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13
Q

Considerations for Food Cost Control in Purchasing

A
  1. Implement the buying policies set by the management
  2. Choosing suppliers after comparing prices, specifications
  3. Purchasing from suppliers who are reliable and reputable
  4. Purchasing enough quantity that meets the production needs
  5. Establishment and proper use of specifications
  6. Following a good purchasing procedure
  7. Use of necessary forms
    ○ Purchase requisitions
    ○ Purchase order form
    ○ Specifications
    ○ Price list
    ○ Summary of purchase record
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14
Q

2 types of costs based on control

A

controllable costs and non-controllable costs

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15
Q

cost documented in financial records

A

historical cost

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16
Q

What should a food service institution do with a plow horse food item?

A

consider increasing the price

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17
Q

What are the balancing concerns in labor cost control?

A

Management
Employees and customers

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18
Q

Cost control process (NRA-EF)

A
  1. Collect accurate sales and cost data
  2. Monitor and analyze sales and costs
  3. Take corrective action as
    appropriate
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19
Q

This is a part in the planning stage that pertains to indicators which facilitate effective monitoring of employee performance

A

Performance standards

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20
Q

Type of cost which refers to all forms of pay & other rewards given to the employee

A

labor cost

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21
Q

What are the control techniques that a manager may use?

A
  1. Establishment of standards
  2. Establishment of procedures
  3. Training of employees
  4. Observing and correcting employee
  5. Use of financial records
  6. Disciplining employees
  7. Preparing and following budgets
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22
Q

This part of the planning stage is based on a clear idea of what the enterprise is

A

Positions that need to be filled

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23
Q

This pertains to compensation that is given beyond obligation

A

Tips/Gratuities

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24
Q

Considerations in Controlling Issuance and Inventory

A
  1. No item should be moved out of the storage area without necessary documentation (requisition and issuance sheet)
  2. Perform both perpetual and physical inventory of stocks with proper documentation
  3. Ensure that forms and computer files are accurate
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25
Q

What parameters should you consider in making management decisions?

A
  • Preparation and service costs
  • Restaurant’s image
  • Customer’s expectations
  • Other factors that may explain low popularity/low profitability of the items
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26
Q

cost per serving, per hourly work

A

unit cost

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27
Q

This pertains to the summary of the financial performance over a given interval of time

A

Income statement

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28
Q

Two types of costs associated with the evaluation stage on evaluating payroll cost in terms of standard labor costs

A

Actual Payroll Cost
Standard Labor Cost

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29
Q

This pertains to all forms of pay and other rewards given to employees

A

Compensation

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30
Q

What type of food items are best used with slotted spoon or spoodle as a dish-up tool?

A

Small pieces

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31
Q

Tells how much your business is worth and if you can still go on with it

A

Balance sheet

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32
Q

Costs over which the managements have little to no control such as insurance, mortgage, and license fees

A

non-controllable costs

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33
Q

Considerations for Food Cost Control in Storage, Inventory, and Issuance

A
  1. Maintaining proper conditions in the dry and cold storage areas
  2. Following a good storage, inventory, and issuance procedure
  3. Practice control measures in storage
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34
Q

what data are included in step 1: Collect accurate sales and cost data?

A
  1. Period
    *Yearly & monthly: pre-operations planning
    *Weekly & daily: purchasing & scheduling
    *Daily & meal: scheduling & planning
  2. Sources: POS or manual tabulation
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35
Q

Examples of operating and other expenses

A

Utilities, laundry and linen supplies, repairs, replacement and maintenance, printing, paper goods, office supplies, cleaning materials, garbage disposal, depreciation, rent, insurance and taxes

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36
Q

What actions are done in step 3: Take corrective action as appropriate?

A

corrective actions, reforecast

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37
Q

These are based on a labor cost% set by a certain type of operation and established based upon expected sales

A

Payroll budgets

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38
Q

What is the impact of small changes in step 3: Take corrective action as appropriate?

A

can become significant
losses

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39
Q

Give examples of direct compensation

A

• Salaries
• Wages
• Tips/Gratuities
• Bonus
• Commission

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40
Q

Quantitative method of evaluating the success of menu items

A

Menu engineering

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41
Q

Considerations in Food Cost Control for Food Production

A

● Forecast: determine quantity of items to be prepared (sales history, standardized recipe, meal census)
● Prepare a food production chart
● Supervise food production

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42
Q

Pertains to what you own, resources with economic value owned by an individual, firm or corporation

A

Assets

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43
Q

What type of food items are best used with scoop as a dish-up tool?

A

Semi-solid

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44
Q

4 parameters involved in the planning stage

A
  1. Payroll budget
  2. Positions that need to be filled
  3. Schedule of employees
  4. Productivity standards
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45
Q

What is the formula of an item’s profit contribution

A

Profit Contribution = [Selling Price - (Raw Food Cost + “Free Items”)] X Number of Orders Sold for a Menu Item

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46
Q

Formula for Labor Costs %

A

[(Sum of all payroll costs (current+deferred))/(sales in a given period)] X 100

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47
Q

Based on popularity and profitability, what food item should be evaluated on what makes it non-popular? Which part of the graph is this on?

A

Puzzle (lower right quadrant)

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48
Q

differentiate directly variable and semi-variable

A

variable cost - directly variable have direct proportion
semi variable cost (salary or wages) not in direct proportion

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49
Q

cost of food and labor in one period

A

total cost

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50
Q

Considerations in payroll budget

A

Menu pricing
Type of service system
Level of service offered

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51
Q

Considerations for Food Cost Control in Receiving

A
  1. Following a good receiving procedure based on a sound method
  2. Use of necessary forms
    ○ Invoices
    ○ Credit memorandum and discrepancy report
    ○ Price list
    ○ Specifications
    ○ Receiving records
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52
Q

What are the two pricing methods?

A

Conventional Method
Scientific Method

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53
Q

This pertains to compensation calculated as a percentage of sales

A

Commission

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54
Q

It is the prices of goods or services when they are consumed or rendered

A

Cost

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55
Q

This pertains to compensation that is based on an hourly rate of pay

A

Wages

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56
Q

Pertains to mortgages, bonds, and other debts that are being paid off gradually

A

Long term liabilities

57
Q

Labor Cost Control Strategies

A

• Use of labor-saving devices
• Use of convenience foods
• Training and development of employees
• Effective scheduling
• Lower employee turnover

58
Q

What are the two types of compensation

A

Current
Deferred

59
Q

Define labor cost control

A

This pertains to a process used to direct, regulate, and restrain employees’ actions in order to obtain desired levels of performance at appropriate levels of cost

60
Q

Pertains to what you owe others, debts, or obligations

A

Liabilities

61
Q

Pertains to the cost when food is sold, given away, stolen or wasted

A

Incurred

62
Q

Give examples of deferred compensation

A

• Pension benefits
• Social security

63
Q

Evaluation stage is for?

A

evaluating payroll cost

64
Q

This cost is most readily controlled and subject to the greatest fluctuation

A

Food cost

65
Q

Which part of the planning stage includes organizational charts and job analysis

A

Positions that need to be filled

66
Q

What are the two types of current compensation

A

Direct compensation
Indirect compensation

67
Q

What is the formula of the selling price of combination menus

A

Selling Price = (Total RFCs + % Hidden Loss) x Computed Mark-up

, where Total RFCs is the sum of the RFC of each food item in the combination menu

68
Q

What data are monitor and analyze for step 2: Monitor and analyze sales and cost?

A
  • Actual sales & costs vs. budget, standards & historical
    data
  • Line item review
  • Difference: amount or percentage
69
Q

Two ideal characteristics of a menu

A

Popular and profitable

70
Q

Cost control strategies for operating or other expenses

A

• Establishment of protocols
• Use of energy saving equipment
• Maximize use of equipment
• Use of convenience foods

71
Q

Formula of actual payroll cost

A

Actual Payroll Cost = Total Hours X Hourly Wage Rate

72
Q

What are the considerations in employee schedules during the planning stage

A
  1. Types and numbers of employees needed at different levels of business volume
  2. Standard work hours (no. of employee hours required to perform a given volume of work)
73
Q

What variables comprise the total food available

A

Opening inventory and purchase

74
Q

What type of food items are best used with ladle as a dish-up tool?

A

Liquid form

75
Q

This is used to compute composite food cost percentage

A

Menu product mix

76
Q

Utilities and mortgage are examples of what type of cost

A

overhead or operating cost

77
Q

What are the 2 classifications of costs

A

relationship to sales volume & based on control

78
Q

What percentage is usually allocated for hidden loss?

A

10%

79
Q

This pertains to the sum of all individual items’ popularity

A

Total Sales Mix

80
Q

Periods in identifying and controlling food cost

A

Daily, weekly, monthly basis

81
Q

projection of what costs will be in the future

A

planned cost

82
Q

Used by managers to regulate and guard against excessive cost

A

Cost Control

83
Q

Costs that the management can directly control such as food and labor

A

controllable costs

84
Q

Formula in evaluating payroll cost in terms of payroll cost percentage

A

(Total Payroll Cost/Total Gross Sales) X 100

85
Q

What way is best to dish-up food sold by unit weight?

A

Pre-portioned

86
Q

Method of menu evaluation or analysis to DETERMINE what menu items are popular and profitable

A

Menu engineering (Contribution analysis)

87
Q

This record pertains to a statement of financial condition that considers the assets and liabilities

A

Balance sheets

88
Q

These expenses take up 12-18% of departmental budget

A

Operating and other expenses

89
Q

Give examples of indirect compensation

A

• Paid vacations
• Health benefits
• Life insurance
• Meals
• Accommodations
• Use of recreational facilities
• Use of company automobiles

90
Q

What are the Food Cost Control Strategies

A

● Use of convenience foods
● Correct costing and effective pricing of recipes
● Forecasting
● Portion control
● Use of standardization recipes

91
Q

Examples of an income statement

A

• Earnings, expenses and any gains or losses
• Considers: sales, cost of goods sold, and operating expenses

92
Q

Two types of assets

A

Current assets
Fixed assets

93
Q

How to make a menu popular and profitable

A
  • effective pricing
  • menu engineering techniques
94
Q

Formula of Gross Profit

A

Gross profit = Income (sales) - cost of food sold

95
Q

Formula of % Popularity/% Sales Mix/Product Mix

A

% Popularity or % Sales Mix or Product Mix = (Number of the item sold/Total number of items sold within a category) X 100%

96
Q

This is a detailed analysis that shows quantities sold of each item, their selling price and standard portion cost

The table also includes the food cost%, total cost, and total sales

A

Menu Product Mix

97
Q

Variances in food cost can be attributed to:

A
  1. Non-compliance to standard recipe or portion sizes
  2. Inaccurate calculation of allocation of stock requirements
  3. Increases prices of ingredients without an increase in selling price
  4. Unaccounted consumption or transaction (employee meal, promotion)
  5. Inability of the kitchen to produce expected yield
  6. Plenty of unsold left-over food
  7. Errors in cost computation or unreliable data like out-dated prices
  8. Raw materials purchased at high price
  9. New employees not properly trained
  10. Theft of product or cash from sales
  11. Products issued without requisitions or transfers
  12. Forgetting to record invoices and other figures from forms
  13. Menu mix out of balance
98
Q

Formula for net profit or loss

A

Net profit or loss = Income (sales) - (cost of food sold + labor, overhead and operating costs)

99
Q

Cost that is unaffected by changes in sales & volume

A

fixed cost

100
Q

This sheet equates to net worth

A

Balance sheets

101
Q

This involves computing for popularity percentages

A

Menu popularity analysis

102
Q

Formula of standard labor cost

A

Standard Work Hours X Hourly Wage Rate

103
Q

Summary account used at the end of an accounting period to collect the balances of the nominal accounts so that the net profit or loss may be shown

A

Profit & Loss (P&L) Statement

104
Q

It is the component of the foodservice system that regulates, directs, checks or modifies operations by using a set of standards

A

Cost Control

105
Q

Lists the amounts of the company assets, liabilities, owner’s equity at the end of an accounting period

A

Balance sheet

106
Q

Starting point of budget control

A

Menu planning

107
Q

Reconciliation of actual food cost with budgeted food cost

A

Food cost report

108
Q

What are the stages in meeting labor cost % targets

A

Planning stage
Implementation stage
Evaluation stage

109
Q

Cost that is affected by changes in sales & volume

A

variable cost

110
Q

Parameters to consider in the planning stage associated with performance standards

A

Quality
Productivity
Cost
Safety and sanitation

111
Q

What record is most associated with controlling cost at post-operations

A

Basic Financial Records

112
Q

What is the formula of % Profitability?

A

% Profitability (Contribution Margin) = One Item’s Profit Contribution/Total Category Contribution x 100%

113
Q

food and labor cost less than or equal to 65%

A

prime cost

114
Q

This compensation is received after the conclusion of employment

A

Back pays

115
Q

This pertains to a fixed amount of compensation paid on a weekly, monthly, or annual basis

A

Salary

116
Q

Other term for % popularity

A

% Sales Mix
Product Mix

117
Q

This type of compensation also pertains to back pays

A

Deferred compensation

118
Q

Operating cost is an example of what cost

A

fixed cost

119
Q

“Aces in place” is associated mostly with which part of the planning stage

A

Employee schedules

120
Q

Type of asset that could be turned into cash at a reasonably predictable value within a relatively short time period (<=1 year)

A

Current assets

121
Q

Give me the formula for the food cost percentage

A

Food Cost/Sales X 100

122
Q

This pertains to compensation over a regular salary or wages given as a reward for a specific job performance

A

Bonus

123
Q

Type of asset that pertains to monetary value of the company’s plant, equipment, property, patents, & other items used on a continuous basis ; expected to provide benefit for more than 1 year

A

Fixed assets

124
Q

2 types of relationship to sales volume cost

A

Fixed cost and variable cost

125
Q

2 types of variable cost

A

directly variable and semi-variable

126
Q

What are the tools used for dish-up?

A
  • slotted spoon or spoodle
  • ladle
  • scoop
  • per-portioned
127
Q

Effective control measures for food cost

A

Menu, menu costing and pricing, standard operating procedures

128
Q

3 types of cost

A

Food cost, labor cost, overhead or operating cost

129
Q

Establishment of standards is present in this stage of meeting labor costs % targets

A

Planning stage

130
Q

Considerations for Cost Control in Food Production/Service

A

● Monitoring portioning out/dish-up
● Food Mishap Report
● Menu Tally Sheets

131
Q

Popularity analysis term involved with popularity percentages

A

Sales mix or product mix

132
Q

What is the formula that selling prices are based on?

A

Computed Mark-up X (RFC + % Hidden Loss)

133
Q

This stage of meeting labor cost % targets covers operations

A

Implementation stage

134
Q

Formula of selling price if item is sold per serving portion

A

Selling Price = [(RFC + % Hidden Loss) X Computed Mark-up]/Number of Servings

135
Q

Type of cost which refers to fixed or recurring expenses

A

overhead or operating cost

136
Q

Rent and lease are examples of which cost in the classification of costs based on sales volume

A

Fixed cost

137
Q

Costs that managers focus on

A

Variable cost and controllable cost

138
Q

Formula of Loss

A

Loss = Variance X Price

FN 133 LE2 (3 decks)

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