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CHAPTER 3 COST CONTROL
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What is revenue? (147) The income from sales before expenses
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What is the definition of a cost? (147) The price an operation pays out in the purchasing and preparation of its products or the providing of its service.
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What are the 4 main categories of costs? (147) Food costs Beverage costs Labor costs Overhead costs
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What is another name for a fixed cost? (148) Non-controllable cost
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What are 2 examples of controllable costs? (149) Food cost Hourly wage portion of labor cost
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What is a fixed cost? (151) Costs that remain the same regardless of sales volume
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What is an operating budget? (151) A financial plan for a specific period of time
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What is a forecast? (152) A perdition of sales levels or costs that will occur during a specific time period
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Forecasting revenue is usually determined by looking at what 2 things? (152) Historical data Average sales per customer
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How do you calculate the average sales per customer? (152) Total dollars divided by the total number of customers
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What does the sales history show? (153) It is a record of the number of portions of every item sold on a menu
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What is a production sheet? (153) It is a list of all of the menu items that are going to be prepared for a given date.
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The number of times a menu item is sold during a particular time period is known as what? (153) Sales history
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What is a profit and loss report? (156) A compilation od sales and cost information for a specific period of time
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List the 7 stages of the flow of food process. (165-166) Purchasing Receiving Storage Issuing Preparation Cooking Service
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What is the definition of food cost? (167) The actual dollar value of the food used by an operation during a certain period
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How do you calculate food cost? (See page 167)
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What is inventory? (167) This represents the dollar value of a food product in storage and can be expressed in terms of units, values or both
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Define opening inventory. (167) The physical inventory at the beginning of a given period (such as the month of April)
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Define closing inventory. (167) The physical inventory at the end of a given period.
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What is the formula for calculating food cost percentage? (168) Total food cost / Sales = Food Cost Percentage
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What are the 2 methods used to determine the cost of ingredients in a standard recipe? (170-171) As purchased Edible portion
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What is as-purchased method? (170) It is used to cost an ingredient at the purchase price before and trim or waste is taken into account.
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What is the edible portion method? (171) It is used to cost an ingredient after trimming and removing waste so that only the usable portion of the item is reflected.
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What is a food production chart? (176) It is a form that shows how much product should be produced by the kitchen during a given meal period.
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What is a sales history used for? (176) It is critical in helping management forecast how many portions of each menu item to produce on a given day.
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What is contribution margin? (178) The portion of dollars that a particular menu item contributes to overall profits.
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How do you calculate contribution margin? What is the contribution margin if a menu item sells for 15.00 and has cost of 33% to make?
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What is the straight markup method? (178) Multiply raw food costs by a predetermined fraction
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What is the average check method? (178) The total revenue is divided by the number of seats, average seat turnover and days open in one year.
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What 4 factors affect labor costs? (187) Business volume Employee turnover Quality standards Operating standards
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How do you calculate employee turnover? (189) It is the number of employees hired to fill one position in a year’s time
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What is listed on a master schedule? (190) It lists no names. It just lists the positions and the number of employees in those positions.
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What is a chart that shows the employee’s names and the days and times they are to work? (191) Crew Schedule
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List 3 things a good staff contingency plan should include. (192) Cross training employees Identifying shift leaders Having on call employees
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What is cross training? (192) Training employees to handle responsibilities in areas of the operation aside from their primary work responsibilities
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Explain the process of having on call employees. (192) A certain number of employees must call their operation at a predetermined time to find out whether they have to work that day.
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What is the best time for restaurants and foodservice operations to receive deliveries? (199) When the operation is slow
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How often should fresh fish be delivered to an operation? (200) Daily
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How often should meat be ordered and delivered to an operation? (200) At least 2 or 3 times a week
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What is the document from a vendor that lists such details as items purchased, date of order, purchaser and sales price? (201) Invoice
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What is another name for an invoice? (201) Bill
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What does it mean to take a physical inventory? (204) To count and record the number of each item in the storeroom
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