Module 5: Financial Management P2

deemed essential for a foodservice operation include those used to collect data
on the major phases of the operations.

are those documents used to collect and track actual demand for eating occasions and individual menu items. The data derived from these records are referred to as volume indicators.

A record of daily transactions is essential for preparation of monthly financial statements.6. MiIncludes utilities, laundry, repairs and maintenance, replacement, phone, water,
electricity, office supplies, cleaning materials

Business procedures are needed for accounting of cash received in foodservice operations.

provide a relatively safe place for money during serving hours and also provide accurate data on number of sales made and total cash received

These records may be classified by function: _______ and ________, _______ and __________, ________________, cash transactions, operating and maintenance, and personnel.

What are the four Ks?

An important consideration when setting menu prices

As service increases, costs ______, therefore price must ______

What do you look for in a type of customer? (2)

Level of product quality is determined by (2)?

The ____ of portions served has a significant effect on menu price

Prices may be _______ if supported by product quality and ambiance

Diners expect to pay ______ prices at dinner than at lunch

A good location will support ______ prices than a poor one

The frequency with which menu items are selected by customers

A __________ operation will set prices to break even, whereas a ____________ business will determine its desired profit margin

What are the 6 different pricing methods?

is based on the raw food cost of menu items plus a pricing factor to give a selling price appropriate for the type of organization

found by costing the standardized recipe for each menu item.

Determined by dividing the desired food cost percentage that the foodservice
wishes to maintain into 100 (representing total sales or 100 percent); it is then used to multiply the food cost to arrive at the menu price

Based on the fact that some food items are more labor-intensive than others

Appropriate for homogeneous menu

The % profit must be first ascertained

Based on the rationale that every customer costs a certain amount to serve and those costs will be covered by having a “minimum charge”

Patrons are more interested in getting something w/c represents a good value for their money

Based on the competitor’s price; with the assumption that the competitor’s prices are also satisfactory for the client

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

Cost of salaries and wages + fringe benefits given to employees

What are the factors affecting labor cost? (SBWWLV)

What are the ways to control labor cost?

Labor Cost Control Records

Costs not classified as food and labor.

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

Depreciation, rent or amortization, insurance and taxes

Operating or Overhead Cost Control Records

plan for forecasting needs, probable activities, their costs & the source of anticipated income

gives latest info on sales, food costs and transaction count

summary of incomes and expenses to get the amount of profit (loss) for a given period

summarize the activities and accomplishments of the year just completed; includes information on future development plans

statement of assets, liabilities and capital at a given period