Practice Test Geeks(CRP) Certified Restaurant Professional Practice Test
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Financial Planning & Budgeting Flashcards

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

Read the first 7 Financial Planning & Budgeting flashcards as text

  1. A restaurant's contribution margin per cover is $18 and fixed costs are $27,000 per month. How many covers are needed to break even?

    Answer: 1,500 covers

    Break-even covers = $27,000 ÷ $18 = 1,500 covers, the point at which contribution margin exactly covers fixed costs.

  2. Which financial document provides a snapshot of a restaurant's assets, liabilities, and owner's equity at a specific point in time?

    Answer: Balance sheet

    The balance sheet (statement of financial position) captures what the business owns, owes, and the owner's stake on a single date.

  3. A restaurant owner wants to evaluate whether a new $50,000 piece of kitchen equipment is worthwhile. Which analysis compares the cost against projected savings or revenue gains?

    Answer: Cost-benefit analysis

    Cost-benefit analysis weighs the total expected benefits of an investment against its total costs to determine if it is financially justified.

  4. If a restaurant has $45,000 in current assets and $18,000 in current liabilities, what is the current ratio?

    Answer: 2.5

    Current ratio = $45,000 ÷ $18,000 = 2.5, meaning the restaurant has $2.50 in current assets for every $1.00 of current liabilities.

  5. What is the primary difference between a fixed budget and a flexible budget in restaurant management?

    Answer: Flexible budgets adjust expense targets based on actual sales volume

    A flexible budget recalculates cost targets to reflect actual sales volume, making variances more meaningful than a static fixed budget.

  6. A server upsells a $12 dessert with a food cost of $3. What is the contribution margin of that dessert sale?

    Answer: $9.00

    Contribution margin = Selling price − Variable cost = $12 − $3 = $9, which contributes toward covering fixed costs and profit.

  7. Which practice involves negotiating extended payment terms with food suppliers to improve a restaurant's short-term cash position?

    Answer: Stretching accounts payable

    Stretching accounts payable means delaying supplier payments within agreed terms to retain cash in the business longer.