Purchasing and Cost Control Chapter 5 Flashcards
Accounting Period
A standard period of time (day, week, month) between the tabulation of accounting records
Book Value
the value of the inventory calculated from invoices minus what was used during the accounting period
Closing Inventory
a physical count of the inventory at the ending of an accounting period
Complimentary Meals
meals given away by the owner or manager to accommodate a dissatisfied customer, as a promotional gift, to entertain professional associates, or as menu item samples for potential catering customer
Employee meal credit
the amount charged for employee meals
Extension
the dollar value of inventory, determine by multiplying the price by the quantity
Food Cost
the total dollar amount spent on food in a foodservice operation
Food Cost Percentage
determined by dividing the cost of food sold by the total food sales
Food Cost Report
a form used to calculate food cost percentage
Inventory
The physical quantity of food and nonfood products used in a foodservice operation
Inventory Sheet
List the food and nonfood products by categories, purchasing unit, quantity, price, and location within the foodservice operation
Menu Mix
the number of times that the total inventory is used during a given accounting period
Opening Inventory
A physical count of the inventory at the beginning of an accounting period
Total Food Sales
the sum total of all food sales for an accounting period
Employee Meal Credit Formula
Number of employee meals served x Amount per meal
Food Cost Report Consist of…
Debits (opening inventory, food purchases, sum of inflows)
Credits (Closing inventory, employee meal credit, complimentary meals, sum of outflows)
Cost of Food Sold
Total Food Sales
Food Cost Percentage
What is the formula for Sum of Inflows
Debits:
opening inventory + food purchases = sum of inflows
What is the formula for Sum of Outflows
Credits:
closing inventory + employee meal credit + complimentary meals = sum of outflows
What is the formula for Cost of Food Sold
Sum of Inflows - Sum of Outflows = cost of food sold
What is the formula for Food Cost Percentage
Cost of Food Sold / Total Food Sales = Food Cost Percentage
What is the formula for Inventory Turnover Rate
Cost of Goods Sold / Average Inventory Value = inventory turnover rate
What is the Formula for Average Inventory
Opening Inventory + Closing Inventory / 2 = average inventory
What is the formula for Cost of Goods Sold
Opening Inventory + Food Purchases - Closing Inventory = cost of goods sold
