Textbook Notes (368,434)
HTF 100 (1)
noclue (1)
Chapter 3

# Chapter 3 The Menu.docx

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School
Department
Hospitality/Tourism
Course
HTF 100
Professor
noclue
Semester
Winter

Description
Chapter 3 The Menu: The Foundation for Control Solutions to Problems in the Text Problem 1 1 1 Multiplier = desired food cost % = 0.375 = 2.67 (rounded) Base selling price = ingredient costs × multiplier \$12.63 = \$4.73 × 2.67 No – The answer in the earlier part of Problem 1 (\$12.63) is the base selling price which is the starting point from which other factors should be assessed as the final selling price is determined. Problem 2 Base selling price = Prime ingredient cost × multiplier \$23.59 = \$6.34 × 3.72 Problem 3 a. Base selling price = average contribution margin/guest + Menu item ingredient cost = \$790,000 + \$4.85 161,580 \$9.74 = \$4.89 + \$4.85 b. Step 1 – Determine the ratio of food costs to all other costs plus profit. All non-food costs + profit Food costs = ratio \$710,000 + \$80,000 = 1.35 \$585,000 Step 2 – Calculate the amount of non-food costs and profit for the menu item. Required non-food costs + profit = ratio × ingredient cost \$6.55 1.35 × \$4.85 Step 3 – Determine the base selling price. Required non-food costs + profit + food cost = base selling price \$6.55 + \$4.85 = \$11.40 c. Step 1 – Determine Labor cost/guest. Labor cost/guest = Labor costs = \$426,250 = \$2.64 (rounded) Number of guests 161,580 Step 2 – Determine prime cost/guest = Labor cost (from Step 1) \$2.64 (Prime cost = food + beverage cost) Food cost \$4.85 \$7.49 Step 3 – Determine Base Selling Price. Price Base Selling Cost/Guest \$7.49 = = = \$10.19 price Prime cost 73.5 percentage* *Prime cost Labor cost Food cost = + percentage Revenue Revenue \$426,250 \$585,000 73.5% = + \$1,375,000 \$1,375,000 31.0% + 42.5% Problem 4 Base selling price = [Entrée cost + Plate cost× Mark-up multiplier \$8.02 = [\$2.12 + \$1.70] × 2.1 Problem 5 a. 1 \$403,580 ÷ \$1,187,000 × \$4.57 = Base selling price 1 × \$4.57 = \$13.44 0.34 b. Step 1 – Calculate prime ingredient mark-up multiplier. Revenue \$1,187,000 Multiplier = Entrée costs = \$274,434 = 4.33 (rounded) Step 2 – Calculate base selling price. Base selling price = Prime ingredient cost × Multiplier \$13.51 = \$3.12 × 4.33 c. Base selling price = [Entrée costs + Plate cost]× Multiplier* \$13.44 = [\$3.12 + \$1.45] × 2.94 _1_ = 2.94 1 *Multiplier = Desired food cost = 1 0.34 % \$403,580 ÷ \$1,187,000 d. Step 1 – Determine the average contribution margin per guest. [Labor costs + Other non-food costs] + Average contribution margin = Profit] per guest Number of guests [\$367,970 + \$316,550] + \$98,000] = \$7.25 107,900 Step 2 – Determine the base selling price. Base selling price =Average contribution margin per guest + Total ingredient cost \$11.82 = \$7.25 + \$4.57 e. Step 1 – Determine the ratio of food costs to all other costs plus profit. All non
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