Inventory Control & Cost Management Flashcards

A restaurant's food cost percentage is calculated by dividing cost of food sold by which figure?

Answer: Total food revenue

Food cost percentage = (Cost of Food Sold ÷ Food Revenue) × 100.

Which inventory method assumes the first items purchased are the first items used?

Answer: FIFO

FIFO (First In, First Out) assumes earliest purchased inventory is used first, reducing spoilage risk.

A restaurant purchases 50 lbs of salmon at $12/lb and later 30 lbs at $14/lb. Using weighted average cost, what is the cost per pound?

Answer: $12.75

Weighted average = (50×$12 + 30×$14) ÷ 80 = $1,020 ÷ 80 = $12.75/lb.

What term describes the difference between what inventory should theoretically be used versus what was actually used?

Answer: Usage variance

Usage variance (or inventory variance) flags discrepancies caused by waste, theft, or over-portioning.

Which document records the internal movement of food items from a main storeroom to a kitchen sub-unit?

Answer: Requisition form

A requisition form authorizes and tracks the transfer of product from storage to a production area.

A restaurant wants to reduce its beverage cost percentage. Which action directly targets that goal?

Answer: Implementing measured pours with jiggers

Using jiggers ensures consistent, measured pours that prevent over-pouring and reduce beverage cost.

What does 'dead stock' refer to in a restaurant inventory context?

Answer: Items purchased but rarely or never used in current menu offerings

Dead stock is inventory that sits unused because it no longer matches current menu needs, tying up capital.