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Food Costs, terms
Study Guide
| Question | Answer |
|---|---|
| What is the definition of a CONTROL when referring to Food Cost? | Method of exercising some power over events or situations to achieve a particular result. |
| What is the definition of STANDARD when referring to Food Cost? | Measure that is established to compare levels of attainment for goal or adequacy. |
| Definition: Controllable costs | Costs that management can directly control |
| Definition: Noncontrollable costs | Costs over which management has little or no control |
| Definition: Fixed costs | Costs that remain the same regardless of sales volume |
| Definition: Variable costs | Costs that increase or decrease in direct proportion to sales |
| Definition: Semivariable costs | Costs that increase and decrease with sales but not in direct proportion to sales |
| What are Prime Costs? | Food cost and Labor cost |
| Definition: Corrective Action | Action taken to correct a problem |
| Definition: Sales | Money restaurant takes in for food |
| What is: Cost of food sold | Money spent on food |
| What is the formuala to figure the cost of food sold? | Opening inventory plus purchases Minus ending inventory |
| Definition: Gross profit | Money made on cost of food sold |
| What is the formuala to arrive at the Gross Profit? | Subtracting cost of food sold from sales |
| Definition: Labor Expense | Payroll for hourly employees and salaried management |
| What expenses are included in the Labor Expense? | Hourly wage or salary, FICA and medicare contributions, plus benefits. |
| Definition: Total Expenses | Labor, controllable costs, and noncontrollable expenses |
| Definition: Profit | Money remaining after all expenses are paid. |
| What is the formuala used to figure the profit? | Subtract total expenses from gross profit |
| Definition: Loss | Money lost when expenses are greater than sales. |
| Definition: Income Statement | Report showing sales, costs, and profit or loss of a business. |
| Definition: Line Item Review | Comparison of forecasted budget to actual figures |
| What is another name for the Profit and Loss Statement? | An Income Statement |
| Definition: Closing Inventory | Physical inventory at the end of a given period. |
| Definition: Food Cost | Actual dollar value of food used by an operation during a period. |
| Definition: Food Cost Percentage | Relationship between sales and the cost spent on food to achieve the sales. |
| Definition: Inventory | Dollar value of the food product on hand. |
| Definition: Opening Inventory | Physical inventory at the beginning of a given period. |
| Definition: Purchases | Product received to add to inventory. |
| Definition: Total Food Available | Opening inventory plus purchases |
| What is a Pro forma income statement? | Estimated income statement prepared before the fact. |
| What does AP mean? | As purchased |
| What does EP mean? | Edible portion |
| What is a Conversion Chart? | Shows expected, or average, shrinkage from AP to EP |
| What is a Cooking loss test? | Measures amount of shrinkage during cooking or roasting |
| What is the Edible Portion (EP) method? | Method of costing ingredients based on trimmed (net) weight. |
| Define: Portion Size | Exact size of one serving or portion. |
| What is a Recipe cost card? | Tool used to calculate standard portion cost |
| What is Shrinkage? | Amount of loss due to trimming, cooking, or roasting. |
| What is a Standard portion cost? | Exact amount one serving should cost if prepared to standardized recipe. |
| What is a Standardized recipe? | A receipe that sets the standard of preparing a menu dish. |
| What is a Butcher Test? | Measures amount of shrinkage that occurs after meat is trimmed |
| What is the AP purchased (AP) method? | Method of costing ingredients based on purchase price before trimming. |
| What is the Composite food cost percentage? | Weighted average food cost for all items sold. |
| Define: Factor method | Pricing formula for selling price based on standard food cost percentage and a calculated factor. |
| Define: Markup | Difference between actual cost to produce an item and menu price. |
| Define: Markup differentiation | Different markups on different categories of food based on market expectations. |
| What is the Markup on cost method? | Pricing formula for selling price based on item cost and standard food cost percentage. |
| Define: Menu engineering | Analyzing menu product mix and item's contribution to margin and popularity. |
| Define: Menu product mix | Detailed analysis showing quantities sold of each item, selling price, and standard portion costs. |
| Define: Price-value relationship? | Customer's perception between selling price and value |
| What is the abbreviation for Texas Restaurant Association Markup Method? | TRA |
| Define: TRA | Menu pricing Calculation Method that factors sales, costs, and profit. |
| Define: As Served | After cooking, the Edible Portion is termed AS SERVED |
| What is a Buyer? | Person assigned to purchase products |
| What is a Commissary? | Central point of purchasing that consolidates orders from individual units into one purchase order. |
| What is are Competitive quotes? | Purchasing method common to smaller operations requesting price quotes from 2 or more suppliers on a product. |
| What is Cost-plus? | Central purchasing method used by large operations to buy product at a percentage above invoice cost for distribution to outlets. |
| What is an Invoice? | Bill charging for goods delivered by a supplier. |
| What is a Market quotation sheet? | Form listing items and item specifications submitted to purveyors for a price quote. |
| What are Nonperishable goods? | Products with a long shelf life, such as coffee and canned goods. |
| What is a One-stop shop? | A Supplier who is able to supply most items used by an operation. |
| What is Par stock? | Level of inventory that must be in stock from one delivery to the next. |
| What are Perishable goods? | Products that have a short shelf life, usually 1 to 3 days. |
| What is a Purchase Order? | Form listing products to be purchased. |
| What are Quotes? | Prices provided by a purveyor for a specific product. |
| What is a Sealed bid? | Purchasing method used by large foodservice units calling for bids of a specific product to be supplied over a stated time period. |
| What is a Specification? | Document listing characteristics of a product related to grade, size, and intended use. |
| What is a Standing order? | Purchasing method that requires supplier to regularly monitor shelf stock and bring it up to par level. |
| What is a Yield chart? | Register of products that compares EP to AP measure. |
| What is a Yield percentage? | EP weight divided by AP weight. |
| What is a Yield test? | Analysis done to determine difference between product's AP weight and EP weight. |
| What is the Actual price method? | Method of valuing inventory based on the Actual price paid for an item. |
| What is the Averaged price method? | Method of valuing inventory based on an average of purchase price for items. |
| Daily Food Cost | Estimate of cost based on inventory movement and food sold. |
| What is Extending? | Multiplying items of physical inventory by their cost and extending totals. |
| What is the FIFO method? | Inventory control and pricing method. Uses first in first out stock rotation. Uses last purchase price to value inventory. |
| What is an Inventory? | An itemized list of goods on hand and their dollar value. |
| What is an Inventory breakdown? | Method used to categorize an operation's food and supplies. |
| What is Inventory turnover? | A measure of how quickly an item in inventory is used. |
| What is Issuing? | Process of taking stock items from storage. |
| What is the Latest Price Method? | Method of valuing inventory based on the latest price paid. |
| LIFO method | Inventory control and pricing method. Uses last in first out stock rotation. Uses first purchase price to value inventory. |
| What is Padding? | Illegal, unethical, and inappropriate additon of nonexistent items to an inventory. |
| What is a Perpetual Inventory? | A theoretical count of goods on hand. |
| What is a Physical inventory? | An actual physical count of items on hand and their their dollar value. |
| What is a Requisition? | A form used by large operations containing information about items needed and used to request stock from the storeroom. |
| What is Time and Temperature Control? | Procedure of following policies to monitor time and temperatue of food flow through the operation. |
| What is a Transfer? | A form used to track items going from one foodservice unit to another. |
| What is a Conversion Factor? | Multiplier used to adjust quantity of ingredients to reach a desired yield from a recipe. |
| What is a Food Production Chart? | Form showing how much product should be produced during a given meal period. |
| What is Recipe Conversion? | Method used to change original yield of recipe to a desired yield. |
| What is a Recipe Yield? | Process of determining number of portions a recipe will produce. |
| What is a Taste Test? | Tastings done prior to a meal period. |
| What is a Waste Report? | Report used to track food wasted and reasons for waste. |
| What is Portion Control? | Amount of food in a serving as determined by standarized recipe. |
| What is a Portion Contol Device? | Implements such as scoops and serving dishes that assist in portioning of food items. |
| What is a Preportioned Item? | Item of food that is measured or weighed before going to service line. |
| Define: Plate Presentation | How a food item appears when it is served. |
| What is a Product Usage Report? | Report showing number of items issued to line, number returned to stock, and number sold to customers. |
| What is a Duplicate Guest-Check System? | Control system using written records of what guests purchased and how much they were charged. |
| What is a Point-of-Sale (POS) control system? | Control system using computer to ensure food items leaving kitchen are sold. |
| What is a Cash Handling Procedure? | Procedures followed in an operation to ensure that all purchases are accurate and accounted for. |
| What is a Bank in relation to a Cash Handling Procedure? | Money in coins and bills sufficient to make change for customers. |
| What is a Daily Sales Report? | Report showing sales, cash, and carges collected as well as money over or short. |
| What is a Cash Report? | Form completed by cashier showing all money, checks, and charges collected during a shirt. |
| What is Labor Cost? | Payroll cost plus all other costs related to compensation, such as FICA and Medicare contribution, worker's compensation insurance, etc. |
| What is the Federal Insurance Contributions Act? | A program for retirement and medical benefits paid for by employers and employees. |
| What is the abbreviation for the Federal Insurance Contributions Act? | FICA |
| Who administers FICA? | The federal government. |
| What is Medicare? | A fund set aside for health benefits for those who cannot afford them. |
| FICA and Medicare contributions are added together and deducted from the employee's wages. True or False? | True |
| Each pay period, the employer and employee pay equal contributions to FICA and Medicare. True or False? | True |
| What are Employee Benefits? | Benefits given by employer to employee that have monetary value but do not affect basic wage. |
| What is Labor Cost Percent? | Relationship between Labor Cost and Business Volume. |
| What is a Budget? | A projection of sales, costs, and profit to guide operational decisions. |
| What are Payroll Dollars? | Number of dollars available for payroll during a period. |
| What is a Master Schedule? | Template showing number of people needed in each position to run the operation. |
| Define: Covers Per Server | Number of customer meals a waitperson can serve in an hour. |
| What is a Crew Schedule? | Chart showing employees' names and days and times scheduled to work. |
| Define: Employee Turnover | Number of employees hired to fill one position in a year's time |
| Define: Overtime | Amount of time over forty hours a nonmanagement employee works in a week. |
| What is the rate of overtime pay mandated by federal law and most state laws? | One-and-one-half times the regular hourly rate. |
| What is a Labor Contract? | An agreement between management and a union representing employees regarding wages, benefits, hours, and working conditions. |
| What is a Quality Standard? | Level of excellence used to measure customer satisfaction. |
| What is a Productivity Standard? | Level set by management to measure amount of work performed by employee. |
| Define: Job Description | Statement that details an employee's duties and expected standard of performance. |
| What is a Return Chart? | Chart to track reasons a customer returned an item to the kitchen. |
| The Waste Report and the Return Chart may be recorded on the same chart. True of False? | True. Management sets the policy on tracking these items. |
| Define: Person-hours | Total hours worked by hourly employees for a given period. |
Created by:
kalimu12
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