Chapter 31 — Self-Check Quiz

Twenty-six questions. Work the calculations on paper. Answer key at the bottom in a collapsed block — do the whole quiz before you open it.

1. Prime cost is:

    A. food cost plus occupancy     B. cost of goods sold plus total labor, as a percentage of total sales     C. all controllable expenses     D. revenue minus operating profit

2. Which of the following never appears anywhere on a profit-and-loss statement?

    A. a comp     B. a discount     C. a void     D. an employee meal

3. Beginning food inventory is \$9,800, purchases are \$6,200, and ending inventory is \$10,100. Food sales are \$19,600. What is the unadjusted food cost percentage?

4. Sales tax collected from guests is recorded as:

    A. revenue, then backed out at year end     B. a liability     C. an offset to cost of sales     D. general and administrative expense

5. A restaurant's week shows cost of sales of \$9,140 and total labor of \$11,860 on net sales of \$33,600. What is prime cost in dollars and percent?

6. Which statement about EBITDA is correct?

    A. it is the same as cash flow     B. it excludes depreciation, which is a real cash cost     C. it excludes the principal portion of debt service, which is a real cash cost     D. it is computed after interest expense

7. An operator says "my food cost is 28% — I divide my invoices by my food sales." What is the single most likely reason that number is wrong, and in which direction does buying heavy at the end of a period push it?

8. Bellwether's plan carries labor at \$500,000, of which \$415,000 is wages and salaries. What percentage does the burden — payroll taxes, workers' comp, and benefits — add on top of every wage dollar?

9. In a 13-period fiscal calendar, each period contains:

    A. exactly one calendar month     B. four weeks, 28 days, and four of each weekday     C. either four or five weeks depending on the quarter     D. 30 days

10. Which is variable but non-controllable?

    A. base rent     B. credit-card processing fees     C. hourly labor hours     D. salaried management wages

11. Bellwether's base grid produces \$27,130 a week and the plan's top line is \$1,550,000. What is the annual revenue bridge, and what percentage of the top line is it?

12. A restaurant transfers \$185 of citrus and herbs a week from the kitchen to the bar and never logs it. What happens to reported food cost and reported pour cost?

13. Controllable income is the line that stops before:

    A. cost of sales     B. labor     C. occupancy, insurance policies, contracted technology, and G&A     D. depreciation only

14. A restaurant's annual debt service is \$69,500, of which \$39,700 is interest. How much of the \$69,500 appears as an expense on the profit-and-loss statement, and where does the remainder go?

15. Why must the inventory count, the sales figures, and the payroll export all cover the same seven-day window?

16. A weekly flash report should be produced:

    A. when the bookkeeper closes the month     B. within one business day of the operating week's close     C. quarterly, to match the tax calendar     D. only when a number looks wrong

17. Comps of \$486 on net sales of \$30,400 with prime cost of \$18,953. What is prime cost percent as reported, and what would it have been with no comps? (Round to one decimal.)

18. True or false: recording comps as marketing expense instead of contra-revenue changes operating profit. Explain your answer.

19. Bellwether's first quarter runs at 66.6% prime cost and the year must land at 60.0%. What must weeks 14 through 52 average, and why is a flat 60% target on the flash report actively harmful?

20. A staffing plan says 31 heads, a labor model says 24 scheduled positions, and the schedule carries 453.5 hourly hours a week. Which of these three is the number you multiply by a wage rate, and what do the other two answer?

21. Under cash accounting, a month in which you stretch your vendors:

    A. looks worse than it was     B. looks better than it was, and the following month looks worse     C. is unaffected     D. cannot be computed

22. Bellwether's occupancy is 6.1% of sales. Explain, in one sentence, why that single fact is what allows the restaurant to survive a 66.3% prime cost when Chapter 1 called that band "distressed."

23. Property insurance sits in occupancy and general liability sits in other operating. If you moved \$29,300 of general liability into occupancy on \$1,550,000 of revenue, what would happen to the reported occupancy and other-operating percentages?

24. Which of these is not a reason to run a foodservice-specific chart of accounts?

    A. so pour cost can be computed by beverage category     B. so card processing can be seen separately from other bank fees     C. so the P&L falls out of the accounts in the right order     D. so operating profit is higher

25. A restaurant's March has an extra Friday, Saturday, and Sunday compared with February. Is a March-over-February revenue comparison meaningful? What calendar fixes this and how?

26. State the difference between a dine time and a table cycle, and say which of the two is always the larger number.