HTM 2030 Lecture Notes - Lecture 10: Rectum

• School: University of Guelph
• Department: Hospitality and Tourism Management
• Course: HTM 2030
• Professor: William Murray

Document Summary

To monitor and assess control procedures, first need to determine: monthly food costs , monthly food costs % Thus, need to (in reverse order start with inventory): determine cost of food sold, determine cost of food consumed, determine cost of food issued, determine physical inventory and its value. Process: counting units on hand, recording in an appropriate place, calculating the value of goods. 5 ways to assign value to units of inventory: actual purchas price method. Can be done only if the prices are physically marked on units of inventory. Highl(cid:455) a(cid:272)(cid:272)urate, ho(cid:449)e(cid:448)er there(cid:859)s roo(cid:373) for hu(cid:373)a(cid:374) error: first-in, first-out (fifo) method. Assumes stock has been properly rotated during the period. Ordered oldest to newest; inventory on shelf can be considered newest. Second most used; highly accurate: weighted-average purchase price method. Value of one unit is determined by dividing all units into total value of inventory. Very logical, but seldom used: latest purchase price method.