Question 1

If a menu item cost an operation $4.00 to produce, and the operation seeks to achieve a 25% food cost, the item should be sold for $10.00.

Accepted Answer

A) True 
 B)False  False

Question 2

What pricing factor would managers use if they want to establish drink prices that will yield a 20% beverage cost?

Accepted Answer

A)  4.0 
B)  4.5 
C)  5.0 
D)  5.5 
A)  4.0 
B)  4.5 
C)  5.0 
D)  5.5 C

Question 3

What is a plate cost?

Accepted Answer

A)  The total EP cost of ingredients in a recipe 
B)  The total AP cost of ingredients in a recipe 
C)  The sum of all product costs included in a single meal 
D)  The sum of all product costs included in a single menu item 
A)  The total EP cost of ingredients in a recipe 
B)  The total AP cost of ingredients in a recipe 
C)  The sum of all product costs included in a single meal 
D)  The sum of all product costs included in a single menu item C

Question 4

A standardized recipe costs $58.80 to produce and it yields 12 portions. The manager wants to achieve a $12.00 contribution margin when selling the item produced by the recipe. What should be the manager's selling price for the item?

Accepted Answer

A)  $13.90 
B)  $14.90 
C)  $15.90 
D)  $16.90 
A)  $13.90 
B)  $14.90 
C)  $15.90 
D)  $16.90

Question 5

Product cost percentage and product contribution margin are the two primary methods used to establish foodservice prices.

Accepted Answer

A) True 
 B)False

Question 6

The vintage of a wine refers to the type of grape used to produce it.

Accepted Answer

A) True 
 B)False

Question 7

What is the term used to describe the pricing of products with very different individual cost percentages to achieve a favorable overall product cost percentage?

Accepted Answer

A)  Value pricing 
B)  Price blending 
C)  Prix fixe pricing 
D)  Ambience pricing 
A)  Value pricing 
B)  Price blending 
C)  Prix fixe pricing 
D)  Ambience pricing

Question 8

A restaurant's ambience is unaffected by its

Accepted Answer

A)  exterior décor 
B)  selling prices. 
C)  staff uniforms. 
D)  background music. 
A)  exterior décor 
B)  selling prices. 
C)  staff uniforms. 
D)  background music.

Question 9

A manager buys a 12-bottle case of chardonnay for $59.40. The manager wants to achieve a contribution margin of $12.00 per bottle for this type of wine. At what price should the manager sell each bottle of chardonnay?

Accepted Answer

A)  $15.95 
B)  $16.95 
C)  $17.95 
D)  $18.95 
A)  $15.95 
B)  $16.95 
C)  $17.95 
D)  $18.95

Question 10

Contribution margin is the amount that a menu item "contributes" to pay for

Accepted Answer

A)  food. 
B)  food and labor. 
C)  labor, all other expenses, and to provide for a profit. 
D)  food, labor, all other expenses, and to provide for a profit. 
A)  food. 
B)  food and labor. 
C)  labor, all other expenses, and to provide for a profit. 
D)  food, labor, all other expenses, and to provide for a profit.

Question 11

Value pricing refers to the strategy of reducing prices on selected menu items for the purpose of increasing an operation's total sales revenue.

Accepted Answer

A) True 
 B)False

Question 12

As the level of service provided in an operation increases, the operation's selling prices should also be increased.

Accepted Answer

A) True 
 B)False

Question 13

It costs an operation $3.00 to produce a menu item. The operation sells the item for $12.00. As a result, the food cost percentage for this item is 20%.

Accepted Answer

A) True 
 B)False

Question 14

What is the formula used to calculate a menu Pricing Factor?

Accepted Answer

A)  1.00 + Desired Product Cost % = Pricing Factor 
B)  1.00 - Desired Product Cost % = Pricing Factor 
C)  1.00 x Desired Product Cost % = Pricing Factor 
D)  1.00 ÷ Desired Product Cost % = Pricing Factor 
A)  1.00 + Desired Product Cost % = Pricing Factor 
B)  1.00 - Desired Product Cost % = Pricing Factor 
C)  1.00 x Desired Product Cost % = Pricing Factor 
D)  1.00 ÷ Desired Product Cost % = Pricing Factor

Question 15

At the beginning of a buffet meal a manager placed $1,400 worth of food on the buffet line. During the meal another $800 of food was added to the line. At the end of the meal the value of the remaining food was $300. What was the total product cost of the manager's buffet during this meal period?

Accepted Answer

A)  $300 
B)  $800 
C)  $1,900 
D)  $2,200 
A)  $300 
B)  $800 
C)  $1,900 
D)  $2,200

Question 16

Which menu format allows management to most quickly respond to changes in the purchase price of needed ingredients or items?

Accepted Answer

A)  Cycle menu 
B)  Daily menu 
C)  Standard menu 
D)  Prix fixe menu 
A)  Cycle menu 
B)  Daily menu 
C)  Standard menu 
D)  Prix fixe menu

Question 17

The standardized recipe for a menu item costs $980.00 to produce and it yields 200 portions. If each portion sells for $17.50, what is the item's food cost percentage?

Accepted Answer

A)  22% 
B)  24% 
C)  26% 
D)  28% 
A)  22% 
B)  24% 
C)  26% 
D)  28%

Question 18

Pricing beverages for open-bar receptions can often be challenging because

Accepted Answer

A)  prices paid for alcoholic beverages vary daily. 
B)  there may be differences in the consumption habits of each group served. 
C)  management cannot effectively control the portion sizes of the alcoholic beverages served. 
D)  in a hosted bar setting the host will want their guests to pay separately for each drink consumed. 
A)  prices paid for alcoholic beverages vary daily. 
B)  there may be differences in the consumption habits of each group served. 
C)  management cannot effectively control the portion sizes of the alcoholic beverages served. 
D)  in a hosted bar setting the host will want their guests to pay separately for each drink consumed.

Question 19

The "Standard" menu format is the type of menu format most commonly used in commercial restaurants.

Accepted Answer

A) True 
 B)False

Question 20

When management uses a target food or beverage cost percentage to price menu items, it believes

Accepted Answer

A)  portion cost in relationship to selling price is of most importance. 
B)  item popularity in relationship to selling price is of most importance. 
C)  profit percentage in relationship to selling price is of most importance. 
D)  contribution margin in relationship to selling price is of most importance. 
A)  portion cost in relationship to selling price is of most importance. 
B)  item popularity in relationship to selling price is of most importance. 
C)  profit percentage in relationship to selling price is of most importance. 
D)  contribution margin in relationship to selling price is of most importance.

If a menu item cost an operation $4.00 to produce, and the operation seeks to achieve a 25% food cost, the item should be sold for $10.00.

What pricing factor would managers use if they want to establish drink prices that will yield a 20% beverage cost?

What is a plate cost?

A standardized recipe costs $58.80 to produce and it yields 12 portions. The manager wants to achieve a $12.00 contribution margin when selling the item produced by the recipe. What should be the manager's selling price for the item?

Product cost percentage and product contribution margin are the two primary methods used to establish foodservice prices.

The vintage of a wine refers to the type of grape used to produce it.

What is the term used to describe the pricing of products with very different individual cost percentages to achieve a favorable overall product cost percentage?

A restaurant's ambience is unaffected by its

A manager buys a 12-bottle case of chardonnay for $59.40. The manager wants to achieve a contribution margin of $12.00 per bottle for this type of wine. At what price should the manager sell each bottle of chardonnay?

Contribution margin is the amount that a menu item "contributes" to pay for

Value pricing refers to the strategy of reducing prices on selected menu items for the purpose of increasing an operation's total sales revenue.

As the level of service provided in an operation increases, the operation's selling prices should also be increased.

It costs an operation $3.00 to produce a menu item. The operation sells the item for $12.00. As a result, the food cost percentage for this item is 20%.

What is the formula used to calculate a menu Pricing Factor?

At the beginning of a buffet meal a manager placed $1,400 worth of food on the buffet line. During the meal another $800 of food was added to the line. At the end of the meal the value of the remaining food was $300. What was the total product cost of the manager's buffet during this meal period?

Which menu format allows management to most quickly respond to changes in the purchase price of needed ingredients or items?

The standardized recipe for a menu item costs $980.00 to produce and it yields 200 portions. If each portion sells for $17.50, what is the item's food cost percentage?

Pricing beverages for open-bar receptions can often be challenging because

The "Standard" menu format is the type of menu format most commonly used in commercial restaurants.

When management uses a target food or beverage cost percentage to price menu items, it believes

Managing Revenue and Expense

Creating Sales Forecasts

Purchasing and Receiving

Managing Inventory and Production

Monitoring Food and Beverage Product Costs

Managing the Cost of Labor

Controlling Other Expenses

Analyzing Results Using the Income Statement

Planning for Profit

Maintaining and Improving the Revenue Control System

Filters

Exam 6: Managing Food and Beverage Pricing

If a menu item cost an operation $4.00 to produce, and the operation seeks to achieve a 25% food cost, the item should be sold for $10.00.

What pricing factor would managers use if they want to establish drink prices that will yield a 20% beverage cost?

What is a plate cost?

A standardized recipe costs $58.80 to produce and it yields 12 portions. The manager wants to achieve a $12.00 contribution margin when selling the item produced by the recipe. What should be the manager's selling price for the item?

Product cost percentage and product contribution margin are the two primary methods used to establish foodservice prices.

The vintage of a wine refers to the type of grape used to produce it.

What is the term used to describe the pricing of products with very different individual cost percentages to achieve a favorable overall product cost percentage?

A restaurant's ambience is unaffected by its

A manager buys a 12-bottle case of chardonnay for $59.40. The manager wants to achieve a contribution margin of $12.00 per bottle for this type of wine. At what price should the manager sell each bottle of chardonnay?

Contribution margin is the amount that a menu item "contributes" to pay for

Value pricing refers to the strategy of reducing prices on selected menu items for the purpose of increasing an operation's total sales revenue.

As the level of service provided in an operation increases, the operation's selling prices should also be increased.

It costs an operation $3.00 to produce a menu item. The operation sells the item for $12.00. As a result, the food cost percentage for this item is 20%.

What is the formula used to calculate a menu Pricing Factor?

At the beginning of a buffet meal a manager placed $1,400 worth of food on the buffet line. During the meal another $800 of food was added to the line. At the end of the meal the value of the remaining food was $300. What was the total product cost of the manager's buffet during this meal period?

Which menu format allows management to most quickly respond to changes in the purchase price of needed ingredients or items?

The standardized recipe for a menu item costs $980.00 to produce and it yields 200 portions. If each portion sells for $17.50, what is the item's food cost percentage?

Pricing beverages for open-bar receptions can often be challenging because

The "Standard" menu format is the type of menu format most commonly used in commercial restaurants.

When management uses a target food or beverage cost percentage to price menu items, it believes

Managing Revenue and Expense

Creating Sales Forecasts

Purchasing and Receiving

Managing Inventory and Production

Monitoring Food and Beverage Product Costs

Managing the Cost of Labor

Controlling Other Expenses

Analyzing Results Using the Income Statement

Planning for Profit

Maintaining and Improving the Revenue Control System

Filters