c. Cost percent, 33.3%;Cost, $1,000.00 d.. Cost percent. 27.3%; Cost, $1,300.40
ID: 331235 • Letter: C
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c. Cost percent, 33.3%;Cost, $1,000.00 d.. Cost percent. 27.3%; Cost, $1,300.40 e.. Cost percent, 24.5%; Cost, $88.20 f. Cost percent, 34.8%; Cost, $1,113.60 )List three examples of foodservice costs that are fixed. Are they control. lable? Explain your answers List three examples of foodservice costs that are variable. Are they con- trollable? Explain your answers. Write a short paragraph illustrating why a comparison of raw dollar costs in two restaurants would not be meaningful, but a comparison of the cost percents for food, beverages, labor, and overhead might be. The present cost to Lil's Restaurant for one à la carte steak is $3.20. This is 40 percent of the menu sales price. a. What is the present sales price? b. At an annual inflation rate of 5 percent, what is this steak likely to cost one year from today? c. Using the cost calculated in (b) above, what should the menu sales price be for this item in one year if the cost percent at that time is to be 38 percent? d. If you were a banquet manager planning a function six months from now and planning to use this item, what unit cost would you plan for? e. The banquet manager in (d) above has already calculated that the other items included in this banquet menu will have increased in cost in six months from $2.00 to $2.11. What should the sales price per person be for this banquet if the desired cost percentage is 40 percent? 8.) At the Loner Inn, total fixed costs for October were $28,422.80. In that month, 14,228 covers were served a. What was the fixed cost per cover for October? b. Assume that fixed costs will increase by 2 percent in November Determine fixed cost per cover if the number of covers decreases by 10 percent in November 9) Joe's Downtown Restaurant purchases domestic red wine at $9.20 per bottle. Each bottle contains 3 liters, the equivalent of 101 ounces. The wine is served in 5-ounce glasses, and management allows for 1 ounce of spillage per 3-liter bottle. a. What is the average unit cost per drink? b. What is the total cost of 60 glasses of wine?Explanation / Answer
4. FOOD SERVICE COST THAT ARE FIXED:
EXAMPLES:
Are they Controlable?
Explanation:
Fixed costs are the costs which is not controllable by the owners or the managers. Normally the fixed costs are unaffected by any changes in the sales volume. Fixed costs remains same even the sales increases or decreases.
From the above examples, rent or occupancy cost, depreciation on equipment and repairs and maintenance are non- controllable, which can not change according to the changes over sales.
Under certain situations in food services costs fixed costs like Advertising cost, promotional costs, Repairs and maintenance etc; can be controllable by the decision of owners and managers. How much they can spend for these activities tend to change according to their decisions.
Hence, fixed costs are not meant to be static or fixed or unchanged. The changes may occur with effect of indirectly or distantly.
5. FOOD SERVICE COST THAT ARE VARIABLE:
Examples:
Are they controllable?
Explanation:
Variable costs are the costs which used to change according to the changes in business volume.
Direct variable costs are the cost which are directly related to the changes in business volume.
Semi variable costs like cost of labor is partially fixed and partially variable. Some employees are working under regular basis and some others works under part time basis. Hence the wags payable to these type of employees are partially fixed and partially variable.
Cost of foods, beverages and labor can be easily controllable by the owners and managers.
6. COMPARISION OF COSTS:
Comparing raw dollar costs in restaurants are not meaningful. Because the raw dollar cost vary to some extent with the changes in the business volume. Here the costs and the sales are calculated in dollars and compared.
To calculete cost per dollar of sale the the manger calculate cost in dollar and they compare it with sales in dollars.
Hence COST PER $ OF SALES = COST IN DOLLAR / SALES IN DOLLAR.
Thus one can compare cost with similar type of restarunts. Because the foods, beverages and the labour involved in the food service business in similar.
But comparing chinesh restaurent with french restaurent is not meaningful. Because there the raw dollar value will be different according to their currency value.
Hence comparing two different types of restaurents is not a meaningful.
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