Deck 3: The Menu: the Foundation for Control

Question 1

Which of the following is an example of an internal factor influencing decisions to change a menu?

A) consumer demand
B) menu mix
C) supply levels
D) competition

Answer 1

B

Question 2

A chicken dinner has a standard food cost of $3.50. If a 30 percent food cost is desired, what would be the base selling price using the ingredients mark­up method?

A) $11.67
B) $12.60
C) $14.76
D) cannot be determined

Answer 2

A

Question 3

The operating budget at the Home Style Restaurant sets food costs at $500,000, all nonfood costs at $750,000, and requires a profit of $95,000. Using the ratio pricing method, what would be the base selling price for a menu item with a standard food cost of $3.00?

A) $5.07
B) $6.98
C) $7.25
D) $8.07

Answer 3

D

Question 4

Menu engineering classifies menu items that are low in popularity and low in contribution margin as:

A) puzzles.
B) plowhorses.
C) stars.
D) dogs.

Question 5

Annual planning at the Sporting Life Restaurant estimates nonfood costs at $220,000, sets required profit at $17,200, and projects that 58,000 guests will be served during the upcoming year. What would be the average contribution margin required per guest during the upcoming year?

A) $3.50
B) $3.75
C) $4.09
D) cannot be determined

Question 6

Given the following information, what is the base selling price of the menu item using the prime costs pricing method? $\begin{array}{lr}\text { Menu Item Food Cost } & \$ 3,40 \\\text { Annual Labor Cost } & \$ 200,000 \\\text { Annual Number of Expected Guests } & 60,000 \\\text { Desired Prime Costs Percentage } & 63 \%\end{array}$

A) $5.29
B) $5.40
C) $8.43
D) $10.68

Question 7

Service has been slow at the Season's Restaurant. The manager has traced the problem to the flow of products from the storeroom to production areas. Which of the following control points is likely to be the focus of corrective action?

A) preparing
B) serving
C) issuing
D) storing

Question 8

The corporate management team of a theme restaurant chain recently evaluated the chain's menu items and identified several puzzles­items that are high in contribution margin but low in popularity. Which of the following would be a reasonable strategy for the management team to adopt in relation to these items?

A) Decrease prices.
B) Place the items in more visible locations on the menu.
C) Shift demand to these items by using suggestive selling techniques.
D) All of the above are reasonable strategies.

Question 9

The food cost of a menu item is $3.85 and its labor cost per guest is $2.95. If the desired prime costs percentage is 60 percent, what would be the base selling price of the item using the prime costs pricing method?

A) $4.92
B) $6.42
C) $11.33
D) $17.00

Question 10

After analyzing menu items, the management team at the Sports Bar & Grill decided that they could increase the prices of several menu items, sell fewer of them, but increase overall revenues. The demand for these menu items would best be characterized as:

A) inelastic.
B) high.
C) elastic.
D) low.