CDM CDM Inventory, Costing & Business Operations

Question 1

What is the formula for calculating the food cost percentage of a doughnut product?

Accepted Answer

(Ingredient cost ÷ Selling price) × 100

Answer

(Selling price ÷ Ingredient cost) × 100

Answer

(Labor cost ÷ Selling price) × 100

Answer

(Overhead ÷ Ingredient cost) × 100

Question 2

In a bakery, what does FIFO stand for and why is it used?

Accepted Answer

First In, First Out — to ensure oldest inventory is used before newer stock

Answer

First In, Final Output — to track production order

Answer

Fresh Ingredients, Fresh Output — a quality standard

Answer

Frozen Inventory, Fresh Output — a cold chain protocol

Question 3

Which document is used to record the amount of each ingredient used in a standard batch of doughnuts?

Accepted Answer

A standardized recipe card

Answer

A purchase order

Answer

An invoice

Answer

A production schedule

Question 4

What does 'yield percentage' refer to when calculating ingredient costs for doughnuts?

Accepted Answer

The usable portion of an ingredient after trimming or processing compared to the as-purchased amount

Answer

The number of doughnuts produced per hour

Answer

The percentage of revenue kept as profit

Answer

The ratio of glaze to dough by weight

Question 5

A baker produces 120 doughnuts per batch and the total ingredient cost is $36. What is the ingredient cost per doughnut?

Accepted Answer

$0.30

Answer

$0.25

Answer

$0.40

Answer

$0.36

Question 6

What is the purpose of a par level in bakery inventory management?

Accepted Answer

It sets the minimum stock quantity that triggers a reorder

Answer

It defines the maximum daily production output

Answer

It measures the quality standard of finished goods

Answer

It records daily sales figures for each product