Chapter 13 — Self-Check Quiz

Twenty-six questions. Answer key in the collapsed block at the bottom; write your answers before you open it.

Multiple choice

1. A restaurant buys chicken, produce, seafood, and paper goods from a single supplier that delivers on one truck against one invoice. That supplier is best described as: (a) a specialty distributor (b) a broadline distributor (c) a direct purchase (d) a prime vendor by definition

2. The primary thing a restaurant buys from a broadline distributor is: (a) the lowest price (b) product expertise (c) consolidation (d) credit

3. A product specification should be written as: (a) a description of what good product looks like (b) an acceptance test a receiver can apply (c) a preference expressed to the salesperson (d) a range wide enough that nothing gets rejected

4. Bellwether's poultry spec includes the line "giblets — liver — packed in cavity, required." The specific business consequence of omitting that line is: (a) the birds arrive at the wrong temperature (b) the birds weigh more than costed (c) a \$14 menu item acquires an unbudgeted purchased ingredient (d) the supplier charges more per pound

5. Par level is best defined as: (a) the amount you always keep on hand (b) forecast usage until the next delivery plus a deliberate safety stock (c) the amount the sales rep recommends (d) one week of usage

6. Bellwether's Tuesday poultry par is 24 birds and its Friday par is 28. The split is uneven because: (a) the supplier delivers more on Fridays (b) the Tuesday delivery covers three services and the Friday delivery covers two much larger ones (c) birds are cheaper on Friday (d) the walk-in is fuller on Tuesday

7. The chapter argues that the poultry line can run as a standing order rather than order-to-par principally because: (a) chicken keeps well (b) the supplier requires it (c) the overage has a guaranteed downstream use on the menu (d) the price is contracted

8. Which of these is NOT one of the seven receiving checks? (a) temperature (b) count (c) shelf life remaining as a percentage of total (d) price against the quote

9. A delivery of hanger steak arrives at 47°F and the driver offers a 25% discount. The correct response is: (a) accept at the discount and use it tonight (b) accept and cook it to a higher temperature (c) reject the affected lines (d) accept and note it on the invoice

10. A credit memo is worth the paper it is printed on only if: (a) the salesperson agrees to it by phone (b) the driver signs it at the door and it is verified against the statement (c) it is entered in the POS (d) the chef is told about it

11. "Invoice reconciliation" means matching: (a) the invoice to the statement (b) the invoice to the check you wrote (c) the order guide, the invoice, and what physically arrived (d) the invoice to the previous week's invoice

12. FIFO, stated as a physical action, is: (a) label everything (b) load new product behind old product (c) count in shelf order (d) use the oldest item on the shelf

13. In the storage order shown in Figure 13.7, raw poultry sits on the bottom shelf because: (a) it is the heaviest (b) it is the coldest part of the box (c) anything that drips will land on product cooked to a higher temperature (d) it is used most often

14. A physical inventory count sheet should be printed: (a) alphabetically (b) by supplier (c) in shelf order matching a fixed count route (d) by dollar value descending

15. The usage formula is: (a) purchases ÷ sales (b) beginning + purchases − ending (c) ending − beginning + purchases (d) purchases − waste

16. The difference between "invoices ÷ sales" and true food cost is exactly: (a) waste (b) theft (c) the change in inventory divided by sales (d) the credits you did not take

17. Inventory turnover is computed as: (a) purchases ÷ ending inventory (b) sales ÷ average inventory (c) cost of product used ÷ average inventory (d) average inventory ÷ days in the period

18. A restaurant that reduces average food inventory from \$6,025 to \$5,000 has: (a) increased profit by \$1,025 (b) reduced food cost by \$1,025 (c) released \$1,025 of cash (d) reduced its COGS line by \$1,025

19. Chapter 11 placed theft seventh in the variance investigation order. This chapter's position on that ordering is: (a) theft should move up once receiving is controlled (b) the ordering is unchanged, and most of the first several causes are physical rather than human (c) the ordering applies only to large variances (d) the ordering should be reversed for cash-heavy operations

20. A waste log's primary value is: (a) the data it produces (b) that writing something down at the moment of disposal reduces disposal (c) satisfying the health department (d) allocating cost between stations

Short answer

21. Bellwether orders 24 birds Tuesday and 28 Friday at 3.5 lb each and \$3.20/lb. Compute the weekly poultry spend and the annual spend, and state the weekly figure as a percentage of the \$6,438 food order guide.

22. A week's figures: beginning food inventory \$6,120; gross invoices \$6,720; credits applied \$210; transfers out to bar \$95; transfers in from bar \$40; ending food inventory \$5,930; food sales \$21,860. Compute food used and true food cost, then compute the two common shortcut answers and say which direction each errs.

23. From question 22's figures, compute average inventory, weekly turnover, annualized turnover, and days of inventory on hand.

24. A Friday delivery of 28 birds is billed at 109.20 lb at \$3.20/lb against a 3.25–3.75 lb spec. State the average bird weight, the overcharge against a 3.50 lb spec target, and the two things the receiver does about it at the door.

25. Explain, in three sentences, why the walk-in is described as "a financial statement," using two of the five findings from the surprise inspection.

26. Bellwether's twelve key-item lines are about \$3,550 of the \$6,438 weekly guide. State that as a percentage, state how long the daily count takes, and explain why counting twelve lines daily beats counting fifty-four lines weekly as a supplement to — not a replacement for — the weekly count.

Answer key **1.** (b) — a broadline distributor. It becomes a *prime vendor* only if there is a commitment agreement; the two are not the same thing. **2.** (c) — consolidation: one order, one delivery window, one account to reconcile. Depth and specificity are what you give up. **3.** (b) — an acceptance test. "Good quality carrots" is an opinion; "no more than 5% with green shoulder, no soft or split" is something a receiver can apply at 6:52 a.m. without calling you. **4.** (c) — the mousse assumes 52 free livers a week. Many air-chilled birds ship without giblets; if the spec is silent, a \$14 starter acquires a purchased ingredient nobody budgeted. **5.** (b). **6.** (b) — Tuesday covers Tue/Wed/Thu (12 + 15 + 18 = 45 halves, plus 3 cushion = 48 halves = 24 birds); Friday covers Fri/Sat (24 + 27 = 51 halves, plus 5 cushion = 56 halves = 28 birds). **7.** (c) — the eight halves left at Saturday close are Sunday's hash. Cross-utilization converts safety stock from a spoilage risk into a menu item sold at full margin. **8.** (c). The seven are time window, temperature, count, weight, spec, price, and signature. **9.** (c) — reject. Temperature is not a quality dimension you can discount past; there is no price at which product received above 41°F is a good buy. **10.** (b). **11.** (c) — the three-way match. Checking the invoice alone catches nothing, because the invoice is the supplier's account of events. **12.** (b) — load new behind old. The physical formulation survives a busy morning; the principle does not. **13.** (c) — storage order runs top-to-bottom by required minimum cooking temperature, ready-to-eat highest and poultry lowest. Chapter 25 owns the pathogen reasoning. **14.** (c). **15.** (b) — beginning + purchases − ending, adjusted for transfers and applied credits. **16.** (c) — exactly the change in inventory divided by sales. It is not a bias in a consistent direction; it flatters you in a week you ran the walk-in down and punishes you in a week you bought ahead. **17.** (c). **18.** (c) — cash. Nothing on the P&L changes; \$1,025 that was sitting on a shelf is now in the bank account. Inventory is cash you decided to store as food. **19.** (b). **20.** (b) — the measurement is the intervention. Waste drops in week one, before anybody analyzes anything. **21.** 52 birds × 3.5 lb = 182 lb × \$3.20 = **\$582.40 a week**; × 52 weeks = **\$30,284.80 a year**. \$582.40 ÷ \$6,438 = **9.0%** of the food order guide from one line. **22.** Food used = 6,120 + 6,720 − 210 − 95 + 40 − 5,930 = **\$6,645**. True food cost = 6,645 ÷ 21,860 = **30.4%**. Gross invoices ÷ sales = 6,720 ÷ 21,860 = **30.7%** — errs *high*, because it charges you for product you bought and did not use. Net purchases ÷ sales = 6,510 ÷ 21,860 = **29.8%** — errs *low*, because inventory fell \$190 and the shortcut gives you no credit for eating your own shelf. Note that the two shortcuts disagree by nearly a full point, which is the deeper problem: "invoices over sales" is not even a well-defined method. **23.** Average inventory = (6,120 + 5,930) ÷ 2 = **\$6,025**. Weekly turnover = 6,645 ÷ 6,025 = **1.10 turns**. Annualized = 1.10 × 52 = **about 57 turns a year**. Days on hand = 7 ÷ 1.10 = **6.4 days** — inside the four-to-eight-day range typical of a well-run full-service operation. **24.** 109.20 ÷ 28 = **3.90 lb average**, above the 3.75 lb spec ceiling. At spec target, 28 × 3.50 = 98.00 lb × \$3.20 = \$313.60; billed \$349.44; **overcharge \$35.84**. At the door the receiver (i) accepts under protest with the exception written on both copies and the driver's signature, and requests the \$35.84 credit, and (ii) — the part that saves the plate — has the halves portioned back to 1.75 lb, routing the 11.2 lb of trim to the hash and the stock rather than onto plates as free protein. **25.** Suggested answer: everything that determines food cost is physically visible in a walk-in — labeling, dating, rotation, storage order, temperature — so the box can be read from the doorway. The 46°F reading is simultaneously a cold-holding violation and a shelf-life loss worth roughly \$84 a week, or 0.4 points of food cost. The raw chicken over the greens is simultaneously a cross-contamination violation and evidence that nothing has an assigned shelf, which is also why the count sheet does not match the box. The same neglect writes the violation and the variance. **26.** \$3,550 ÷ \$6,438 = **55%** of the food money in twelve lines out of fifty-four. The daily count takes about **twelve minutes**. It beats a weekly count *as a supplement* because the weekly count tells you what happened over seven days while the key-item count tells you within a day when one of the twelve lines carrying most of the money starts moving faster than it should — which is the difference between catching a problem on Wednesday and catching it the following Monday. It is not a replacement, because the weekly count is what feeds the usage formula and the flash report; twelve lines cannot produce a food cost percentage.