Menu Planning and Costing Flashcards

A plate costs $4.20 to produce and the target food cost is 30%. Using the food cost percentage method, what is the menu price?

Answer: $14.00

Divide the plate cost by the target food cost percentage: $4.20 / 0.30 = $14.00.

What pricing factor corresponds to a target food cost of 25%?

Answer: 4.0

The pricing factor is 100 divided by the target percentage, so 100 / 25 = 4.

Which costs together make up prime cost?

Answer: Food and beverage cost plus total labor cost

Prime cost is the cost of goods sold plus total labor cost, including payroll taxes and benefits.

A steak sells for $32.00 and its plate cost is $11.50. What is its contribution margin?

Answer: $20.50

Contribution margin is selling price minus food cost: $32.00 − $11.50 = $20.50.

In menu engineering, an item with high popularity but a low contribution margin is called a:

Answer: Plowhorse

Plowhorses sell well but bring in less profit per sale than the menu average.

Which menu engineering strategy is usually recommended for a Puzzle item (high contribution margin, low popularity)?

Answer: Reposition and promote it to increase sales

Puzzles are profitable but undersold, so better menu placement, descriptions, and server suggestions can lift their sales.

A chef adds a fixed $9.00 to the plate cost of every entrée regardless of its food cost. Which pricing approach is this?

Answer: Contribution margin (gross profit) pricing

Contribution margin pricing adds a set dollar margin to the item's cost instead of using a percentage.