Practice Test Geeks(CRM) Certified Restaurant Manager Practice Test
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Food Cost Management & Pricing Flashcards

7 cards from real CRM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Food Cost Management & Pricing flashcards as text

  1. What is the primary purpose of a 'purchase specification' in food procurement?

    Answer: To define exact quality standards so all vendors bid on identical product

    Purchase specifications ensure consistent product quality and allow fair price comparisons among suppliers by defining grade, size, weight, and other attributes precisely.

  2. A seafood dish has a food cost of $9.80. To achieve a 28% food cost percentage, what minimum price should it appear on the menu?

    Answer: $35.00

    Menu price = Food Cost ÷ Target % = $9.80 ÷ 0.28 = $35.00.

  3. Which purchasing approach requires suppliers to compete on price for each order rather than committing to a contract?

    Answer: Open-market buying

    Open-market buying solicits quotes each time an order is placed, which can secure lower prices but requires more administrative effort and offers less price stability.

  4. If a restaurant's actual food cost is 38% but theoretical food cost is 31%, what is the most likely cause of the 7% variance?

    Answer: Theft, waste, over-portioning, or unrecorded voids

    A gap between actual and theoretical food cost typically signals operational problems such as employee theft, waste, portion errors, or sales not being rung into the POS.

  5. What does 'FOB destination' mean in a food purchasing contract?

    Answer: The seller pays freight and owns the goods until they arrive at the restaurant

    FOB (Free On Board) Destination means the supplier retains title and risk of loss until delivery is accepted at the buyer's location.

  6. A restaurant uses the 'factor pricing method.' If the food cost factor is 4 and a dish costs $5.25 to produce, what is the menu price?

    Answer: $21.00

    Factor method: Menu price = Food Cost × Pricing Factor = $5.25 × 4 = $21.00.

  7. Which document formally records goods received from a vendor and is used to verify the accuracy of invoices?

    Answer: Receiving report

    A receiving report documents the quantity, quality, and price of items actually delivered, providing the evidence needed to approve or dispute vendor invoices.