Cost Control Flashcards

What is the recommended industry benchmark range for total prime cost (food + beverage + labor) as a percentage of sales in a full-service restaurant?

Answer: 55–65%

Most full-service restaurants target a prime cost of 55–65% of sales to remain profitable after overhead expenses.

Which of the following best describes 'pilferage' as a cost control concern?

Answer: Theft of food, beverage, or cash by employees or customers

Pilferage refers to theft of inventory, supplies, or cash, which inflates costs and reduces profitability.

A manager compares weekly actual food cost against the standard food cost derived from recipes. This practice is known as:

Answer: Cost variance analysis

Cost variance analysis compares actual costs to standard (recipe-based) costs to identify discrepancies.

In which situation would a manager use a 'pull system' for inventory management?

Answer: When restocking is triggered only by actual consumption or demand

A pull system replenishes inventory only when items are consumed, reducing over-purchasing and waste.

Which cost control document specifies the exact ingredients, quantities, preparation methods, and yield for each menu item?

Answer: Standardized recipe

A standardized recipe ensures consistency in quality, portion size, and cost for every menu item.

A foodservice director notices beverage cost is consistently 3% above target. Which action would MOST directly identify the root cause?

Answer: Conduct a detailed pour-cost analysis and compare against standardized recipes

A pour-cost analysis measures actual beverage usage against standardized recipe standards to pinpoint where cost overruns occur.

What term describes the practice of transferring food items between departments (e.g., kitchen to bar) and recording the associated cost?

Answer: Inter-departmental transfer

Inter-departmental transfers move goods between cost centers and must be recorded to accurately reflect each department's true food or beverage cost.