CRM Food Cost Management & Pricing 2

Question 1

A restaurant's beginning inventory is $8,200, purchases total $14,500, and ending inventory is $7,800. What is the cost of goods sold?

Accepted Answer

$14,900

Answer

COGS = Beginning Inventory + Purchases – Ending Inventory = $8,200 + $14,500 – $7,800 = $14,900.

Question 2

Which pricing method sets menu prices based on what competitors charge rather than internal cost analysis?

Accepted Answer

Competitive pricing

Answer

Competitive pricing uses market rates as the primary benchmark instead of calculating prices from food cost percentages.

Question 3

What does a 'yield test' primarily determine?

Accepted Answer

The usable portion of a raw ingredient after trimming and cooking

Answer

A yield test measures what percentage of a purchased ingredient is actually usable after waste, trimming, and cooking loss.

Question 4

If a menu item's food cost is $4.50 and the target food cost percentage is 30%, what should the selling price be?

Accepted Answer

$15.00

Answer

Selling price = Food Cost ÷ Food Cost % = $4.50 ÷ 0.30 = $15.00.

Question 5

Which inventory valuation method assumes the most recently purchased items are used first?

Accepted Answer

LIFO

Answer

LIFO (Last In, First Out) assumes the newest inventory is consumed first, which can raise COGS when prices are rising.

(CRM) Certified Restaurant Manager Practice Test