FSN 202 Lecture Notes - Lecture 21: Income Statement, Direct Labor Cost, Foodservice
21 Nov 2016
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Budget planning process: collect operating data, nancial records. What was spent in the past: analyze data. Estimate revenues, then plan expenditures: discuss factors affecting future operations, discuss future goals, plan budget for next year. Projected expenses for each category: write budget for presentation. Types of budgets: operating budget- 1 year. Guide to day-to-day operation, sales, expenses and pro ts: capital budget- 5 years. Plan for capital expenditures (>)- large equipment purchases, renovations: cash budget. Detailed estimate of cash receipts during budget period, synchronize cash resources with timing of expenditures. Menu pricing: price menu items to cover cost of food, labor, operating costs, pro t, needs to create a perception of value in the customer (target market) What the customer believes the menu is worth: needs to be competitive. Other menu pricing methods: prime cost pricing method. Includes raw food cost and direct labor cost of food preparation: actual cost method.
