Exam 10: Control: Analysis, Corrective Action,and Evaluation

The management team at the Four Corners Restaurant has agreed that only cost variances in excess of $1,000 a month would be analyzed and corrected. Given the following information, which segment of the operation signals the need for analysis and corrective action? July Revenue Cost Variance Breakfast \ 12,000 7\% Lunch \ 35,000 4\% Dinner \ 85,000 1\% Beverage Operation \ 45,000 2\%

When evaluating the effectiveness of actions taken to correct a cost control problem, it is important that managers:

The easiest­to­use source of information for standard (expected) food and beverage costs is:

Managers at the ABC Restaurant have uncovered a problem: food costs have been too high for two months in a row. The restaurant's managers are trying to decide who should be given the responsibility for taking corrective action. One question the managers should ask themselves before assigning responsibility is:

When actual costs vary from standard costs, corrective action:

For the previous month, actual food costs exceeded standard food costs at Buddy's Bar & Grill. Which of the following could have caused the variance?

Last month at Emil's Italian Restaurant, actual food costs fell below standard food costs. Which of the following could be the reason?

Computer technology helps managers in their control efforts by:

Which of the following sources of information is the least reliable basis for developing cost standards for a food and beverage operation?

Year after year, the As­You­Like­It Bistro handles a large volume of business at lunch. The manager attributes the operation's success to radical menu changes every three months. Many of the new menu items result from suggestions made by guests. Which of the following sources of information offers the manager the most reliable basis for developing cost standards?