A Strong Partner for Sustainable Development

Module in
HMPE 5

COST CONTROL

College of Business and Management

BSHM

WPU-QSF-ACAD-82A Rev. 00 (09.15.20)

 Module No. 3

CALCULATING FOOD COST-

PROTECTING REVENUE

2nd Semester AY 2021-

2022

Rina Q. Nifras
Santiago, Charmae E.

Instructor I

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Table of Contents (Chapter Contents, Page)
Title page ii
Table of Contents iii
Instruction to the User iv
Introduction v
Chapter 1 1
Learning Outcomes 1
Overview 1
Pre-test 2
Lesson 1 3
Activities and Exercise 37
Post test 37
References 39
Privacy Notice and Student information 40
Vision, Mission and Core Values of WPU 41

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INSTRUCTION TO THE USER

This module would provide you an educational experience while

independently accomplishing the task at your own pace or time. It aims
as well to ensure that learning is unhampered by health and other
challenges. It covers the topic about Cost Control.

Reminders in using this module:

1. Keep this material neat and intact.

2. Answer the pretest first to measure what you know and what to be
learned about the topic discussed in this module.
3. Accomplish the activities and exercises as aids and reinforcement
for better understanding of the lessons.
4. Answer the post-test to evaluate your learning.
5. Do not take pictures in any parts of this module nor post it to
social media platforms.
6. Value this module for your own learning by heartily and honestly
answering and doing the exercises and activities. Time and effort
were spent in the preparation in order that learning will still
continue amidst this Covid-19 pandemic.
7. Observe health protocols: wear mask, sanitize and maintain
physical distancing.

Hi! I’m Blue Bee, your WPU Mascot.

Welcome to Western Philippines University!

Shape your dreams with quality learning
experience.

STAY SAFE AND HEALTHY!

INTRODUCTION

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 Amidst of the pandemic that we are experiencing education shall continue in
or out of our classroom. The advancement of technology makes learning accessible
in any location at any time.
This module will serve as an alternative learning material to that of regular
classroom teaching and learning delivery. It is designed to cater your needs in
making the most out of the new normal created to reach out you away from the
school vicinity.
The instructor will facilitate and explain the module to the students to
achieve its expected learning outcomes, activities and to ensure that they will learn
amidst this pandemic.

Disclaimer: This module is prepared for instructional purposes only. The

teacher does not claim ownership of this module but patterned the ideas from
different authors.

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Title of the Chapters: Calculating Food Cost- Protecting Revenue

Learning Outcomes

At the end of this chapter, you can:

1. define food cost and explain how manager track and analyze food cost;
2. list and describe the classification of beverages;
3. discuss food storage techniques and FIFO method of stock rotation; and
4. List the external and internal threats to revenue security.

Overview

This module gives readers the means to ensure customer satisfaction and produce

acceptable profit margins. This course offers an introduction to food, beverages,

and labor cost controls, defining a number of key terms and concepts and providing

foundation for the balance of the work as well as some sense of its scope. It

addresses the application of the four-step control process to the primary phase of

foodservice and beverages operation: purchasing, receiving, storing, issuing and

production. It is also including the factor affecting labor cost and labor percentage,

the need for performance standard, training & monitoring performances taking

corrective action.

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PRETEST

This is a pre-test to evaluate if you are sufficiently prepared to begin a new

course of study. The result of this test will not be used as a basis of your
performance and these are a non-graded assessment. This is to determine of your
pre-existing subject knowledge.

True or False: Write T if the statement is true and F is the statement is

false.

_____ 1. Ending inventory is the dollar value of the inventory you

purchased at the beginning of the week.

_____ 2. House wines includes those wines served to a guest who does not
stipulate a specific brand when ordering, as well those named
wines offered by the glass.

_____ 3. FIFO means First In First Out.

_____ 4. Revenue is referred to as net income on the income statement.

_____ 5. Operating profit is gross profit minus all other fixed and variable
expenses associated with operating the business, such as rent,
utilities, and payroll.

_____ 6. Profit margin refers to the revenue a company makes after paying
COGS.

_____ 7. Formula for revenue is revenue= 100 x profit/margin.

_____ 8. 10% is considered a good margin.

_____ 9. Before you determine the price of your restaurant’s meals, you
have to know how much they cost to make

______ 10. Alcohol beverages is a fermented beverage made from grain and
flavored with hops.

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Lesson 1. Calculating Food Cost- Protecting Revenue

A. Learning Outcomes

At the end of this lesson, you should be able to:

1. define food cost and explain how manager track and analyze food
cost;
2. list and describe the classification of beverages;
3. discuss food storage techniques and FIFO method of stock rotation; and
4. List the external and internal threats to revenue security.

B. Time Allotment:

3 hours

C. Discussion

Food cost

 is the ratio of a restaurant’s cost of ingredients (food inventory) and the

revenue that those ingredients generate when the menu items are sold (food sales).

Food cost per serving explained

Before you determine the price of your restaurant’s meals, you have to know how
much they cost to make. Specifically, you need to figure out how much it costs your
restaurant to make one serving of each item on your menu. In this section, we’ll
cover how to calculate your food cost per serving.

Food cost per serving formula

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To calculate your food cost per serving (or food cost per menu item), find the sum
of the ingredient cost per serving.

Cost per serving explained

Johnny of Johnny’s Burger Bar wants to determine his famous Johnny Burger’s
cost per serving. The dish consists of 8 ounces of ground beef, 1 sesame seed bun, 1
tablespoon of sauce, 2 slices of cheese, 2 slices of tomatoes, and 2 potatoes.

Johnny buys his ingredients in bulk and pays $19 for 5 pounds of ground beef. He
calculates that 8 ounces of ground beef for a single burger costs his restaurant
$1.90. Johnny does similar calculations to determine the cost per serving of the
remaining ingredients in the burger.

o 8 ounces of ground beef = $1.90

o 1 sesame seed bun = $0.25
o 1 tbsp. of sauce = $0.10
o 2 slices of cheese = $0.90
o 2 slices of tomatoes = $0.50
o 2 potatoes = $0.75
Cost per serving = $1.90 + $0.25 + $0.10 + $0.90 + $0.50 + $0.75 = $4.40
The ingredients used to make the Johnny Burger cost $4.40.

Food cost
 percentage is the value of food costs to revenue expressed as a percentage.
The figure helps restaurants set menu prices.

What is a good food cost percentage?

To run a profitable restaurant, most owners and operators keep food costs
between 28 and 35% of revenue. With that said, there is no such thing as an ideal
food cost percentage; it varies depending on the type of food they serve and the
restaurant’s overhead and operating expenses.

Each restaurant should calculate their food cost percentage and not rely on catch-
all averages, but the general consensus is that the higher your total restaurant
expenses are (including food costs), the higher your menu prices need to be.

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How to calculate food cost percentage

To calculate food cost percentage, you need to first have values for the following
things:

o Beginning inventory value: the dollar value of the inventory you

purchased at the beginning of the week.
o Purchases: the dollar value of the inventory you purchase
throughout the week and wasn’t part of your beginning inventory.
o Ending inventory: the dollar value of the inventory left over at
the end of the week.
o Total food sales: the dollar value of your sales for the week, which
you can find in your sales reports.
Food cost percentage formula

To calculate your food cost percentage, first add the value of your beginning
inventory and your purchases, and subtract the value of your ending inventory from
the total. Finally, divide the result into your total food sales.

Food cost percentage explained

Let’s see how Johnny’s Burger Bar would calculate their food cost
percentage using these values:

o Beginning inventory value = $11,000

o Purchases = $7,000
o Ending inventory value = $15,000
o Total food sales = $8,000

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Food cost percentage = (11,000 + 7,000) – 15,000 / 8,000

Food cost percentage = 18,000 – 15,000 / 8,000

Food cost percentage = 3,000 / 8,000

Food cost percentage = 0.375, or 37.5%

Johnny’s Burger Bar’s food cost percentage is 37.5%, meaning that 37.5% of their
revenues go towards paying for ingredients. That’s above the industry average for
burger joints, which makes Johnny wonder if he should tweak his menu prices.

To know for sure, he needs to calculate his ideal food cost percentage and compare
it to his actual food cost percentage.

How to calculate ideal food cost percentage

To find your ideal food cost percentage, you first need to know two values:

o Total food costs

o Total food sales
Let’s say their total food costs were $2,500 and, as we see above, their total food
sales are $8,000. To calculate ideal food cost percentage, divide total food costs
into total food sales.

Ideal food cost = $2,500 / 8,000

Ideal food cost = 0.31, or 31%

As it turns out, Johnny’s Burger Bar’s ideal food cost is 31%. Knowing that their
current food cost percentage is 37.5%, it’s clear that Johnny is missing out on 6.5%
more revenue.

Knowing this, Johnny has several options for lowering his food cost percentage:

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 oFind cheaper vendors
oReduce portion sizes
oAdjust menu prices
Johnny chooses to adjust his menu prices.

How to set menu prices

It costs Johnny’s Burger Bar $4.40 and their food cost percentage is 37.5%, which
makes its current menu price $11.70. How much should he charge for his burger to
bring his food cost percentage down to 31%?

To determine that, we’ll use this formula:

Menu item price = 4.40 / 0.31

Menu item price = $14.20

Based on their ideal food cost percentage (31%), the menu price of the Johnny
Burger should be $14.20. That’s a whole $2.50 difference!

While it might not seem like a lot at first, that extra $2.50 per burger adds up quick.
If he sells 75 burgers a day, that $2.50 becomes over $65,700 in additional revenue
per year. Now, just imagine if Johnny optimized the food cost percentages for each
menu item, not just his burgers.

Now, it’s clear that Johnny was underpricing his burgers. He decides to change the
price of his burgers to $14.20 and track its impact on sales and profitability.

3 ways to lower restaurant food costs

If increasing menu prices results in fewer people eating at your restaurant, you can
decrease your food cost percentage by reducing your cost per serving. You can do
this by:

o Find cheaper vendors: Can you get the same quality ingredients
for a lower price with another vendor?

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 o Reducing portion sizes: In Johnny’s case, he could serve a 6-
ounce burger rather than an 8-ounce burger to reduce portion sizes
and his food cost per serving.
o Use cheaper ingredients: While it can lower your food cost
percentage, this is usually a last resort. Customers will notice if your
food quality suffers and you risk losing their business as a result.

Managing the Cost of Beverages

There are three types of operations that serve alcoholic beverages.

These can be grouped as:
1. Beverage only
2. Beverage and Food
3. Beverage and entertainment/ activity
Beverage only operation- usually have predictable traffic flow. Because they
deal only in beverages, these are usually the easiest service operations to manage.
Beverage only operations include:
1. Neighborhood bars
2. Taverns
3. Hotel bars
4. Airport Bars
5. Breweries
6. Wineries

Beverage and Food- many alcoholic beverages were created because they are
enjoyed most when combined with food. Beverage and food operation can include:
1. Quick-service restaurants
2. Full-service restaurants
3. Self-service restaurant
4. Airport bars
5. Sports complexes such as arenas and stadiums
6. Grocery/convenience store carryout
7. Brew pubs
8. Hotel room service
9. Banquet halls
10. Country clubs

Beverage and entertainment /activity- these operations exist because many

people want to do something while they consume their favorite alcoholic beverage.
It includes;
1. Comedy clubs
2. Taverns
3. Entertainment clubs

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 4. Full- service restaurants
5. Sports complexes
6. Brew pubs
7. Nightclubs
8. Country clubs
9. Dance/ music clubs
10. Bowling alleys

Serving Alcoholic Beverages

Alcoholic beverages – a significant amount of ethyl alcohol content is present.
Alcoholic beverages are generally classified as beer, wine
or spirits.
Beer - is a fermented beverage made from grain and flavored with hops.
Wine - is a fermented beverage made from grapes, fruits, or berries.
Spirits - are fermented beverages that are distilled to increase the alcohol content
of the product.

Serving Alcoholic beverages

These products will be specified, ordered, received, and stored much like food
products. However, there are control issues that are much more difficult to handle.
Such controls must be modified to meet the characteristic and inherent increased
responsibility created by the sale of alcoholic beverages. Dramshop laws, passed in
many states, shift the liability for acts committed by an individual under the
influence of alcohol from that individual to the server or operation that supplied
the intoxicating beverage. License states versus control states

Forecasting Beverage Sales – BEER

Forecasting beer sales is basically the same as forecasting any regular menu item -
use sales histories. Keg beer is also known as draft beer, or beer in a form of
packaging in which the beer is shipped to you in multi-gallon units for bulk sale.

Beverage Sales Date: 1/1-1/8

Product: Beer sales Number Sold Percentage Sold
Budweiser Bottles 45 11.25%
Coors Bottles 18 4.50%
Miller Cans 61 15.25
Coor Cans 68 17.00
Budweiser draft 115 28.75
Harp’s Draft 93 23.25
Total 400 100.00
LeRae’s Bar Beer Sales Bar Wine-by-the Glass Sales

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It demonstrates thar, for the period 1/1to 1/8. LeRae’s served 400 beers to guest. It
also details which specific beer those guests ordered.

Forecasting Beverage Sales - WINE

Forecasting wine sales is divided into two parts:

1. forecasting bottled-wine sales
2. forecasting wine-by-the-glass sales. When forecasting sales by the bottle or
glass use sales histories. House Wines – wine served to a guest who does not
stipulate a specific brand when ordering.

Forecasting Wine- By- the Glass Sales

House wines- includes those wines served to a guest who does not stipulate a
specific brand when ordering, as well those named wines offered by the glass.

Beverage Sales Date: 1/1-1/8

Product: Beer sales Number Sold Percentage Sold
Fabiano Chardonnay 30 18.75%
House Merlot 16 10.00
Bolla soave 62 38.75
House Zinfandel 52 32.50
Total 160 100.00
Figure. LaRae’s bar Wine-By -the Glass sales

It details the by-the-glass sales o wine at Larae’s for the period 1/1 to 1/8. From the
data, you know that one of ten guests will buy wine by the glass. Thus 160

Forecasting Beverage Sales - SPIRITS

While the number of people who order a mixed drink can be tracked, the exact item
the guests request is very difficult to determine. One method categorizes all drinks
based on the spirit that forms the base of the drink. Spirit sales can also be tracked
by generic product name, specific product name, or specific drink requested.

Beverage Sales Date: 1/1-1/8

Product: Spirits Number Sold Percentage Sold
Scotch 210 13.1
Bourbon 175 10.9
vodka 580 36.3
Gin 375 23.4

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 Kaluah 175 10.9
Tequila 85 5.3
Total 1600 100

Lerae’s bar Spirit Sales

It demonstrates the system you would use to track spirit sales using the generic
product.

Standardized Drink Recipes and Portions

Control is more important at the bar than in the kitchen because the potential for
waste and theft is greater. For example: Beverage operations are subject to tax
audits Beverage operations can be closed down for violations Employees may bring
their own products to sell Detecting the disappearance of small amounts of
beverage products is very difficult

Standardized Drink Recipes and Portions

The following is the beverage cost % formula:

Cost of Beverage Sold÷ Beverage Sales = Beverage Cost %

Standardized Drink Recipes and Portions

Measuring devices – jigger, free pour, spout control, automated device A

standardized recipe sheet should be prepared for each drink item for costing
purposes. While standardized recipes (including step-by-step prep methods) may
only be necessary for a few drinks, recipes that detail alcoholic portions should be
strictly adhered to.

Purchasing Beverage Products

Beer product request log should be maintained so that guest requests that cannot
be filled are noted and monitored by management Beer is typically sold in cans,
bottles or kegs. Draft beer (beer from kegs) is often the preferred choice and
cheaper for operators to serve. However, special equipment and serving techniques
are required. The shelf life of keg beer is the shortest of all packaging types, ranging
from 30 to 45 days for an untapped keg and even fewer days for a keg that has been
tapped (opened).

Purchasing Beverage Products

Wine must also be selected according to product and packaging. Operators

generally sell wine by the glass, bottle, and split or half bottle. If wine is also
purchased for cooking, it will generally not be of the same quality as that purchased
for drinking.

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Purchasing Beverage Products

As a good manager, you will build a wine list that fits your own particular operation
and guest expectations. In developing a wine list, operators must offer choices for
guests who want to spend a lot or a little. A vintner is a wine producer. Wines
should either complement the food or, in the case of a bar, are popular with the
guests.

Purchasing Beverage Products

Avoid the temptation to offer too many wines on a wine list – increases costs. Wait
staff should be trained to be knowledgeable but not intimidating to guests.
Generally, if operators are having trouble selling wine, the difficulty lies in the
delivery of the product rather than with the product selected.

Purchasing Beverage Products

Distilled spirits have an extremely long shelf life, therefore, a wrong purchase is not
usually a disaster. While packaging is not a major concern of the operator selecting
a product, brand quality is crucial.

Purchasing Beverage Products

In general, operators will select spirits in two major categories, well and call
liquors.Well liquors are those spirits that are poured when the customer does not
specify a particular brand name.Call liquors are those requested by brand name;
extremely expensive call liquors are sometimes referred to as premium liquors.

Purchasing Beverage Products

Operators generally charge a higher price for call or premium liquors. Remember,
guests who order well liquors may be price conscious, but that does not mean they
are not quality conscious also.Quality spirit products at fair prices build customer
loyalty.

Purchasing Beverage Products

Depending on the state and county, special laws may influence how beverage
purchases are to be made or paid for. The goal in purchasing beverages is to have
an adequate, but not excessive amount of product on hand at all times. A broken
case occurs when several different brands or products are used to completely fill the
case. As a general rule, wine, beer, and spirits are purchased by the case.

Receiving Beverage Products

Since beverage products do not vary in quality, as does food, skill required to
receive beverages is somewhat less. As with food, the receiving clerk needs a proper
location, tools, and equipment. Proper delivery schedules must be maintained.
When matching the purchase order to the vendor invoice, only quantity ordered
and price must be verified.

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Receiving Beverage Products

If beer is fresh dated, that is, a date is stamped on the product to indicate its
freshness, very little inspection is required. Key beverage receiving checkpoints are:
correct brand, correct bottle size, no broken bottles, freshness dates (beer), correct
vintage (wine), correct unit price, correct price extension, and correct invoice total.
If errors are detected, a credit memo should be filled out and signed by both the
delivery person and the receiving clerk.

Storing Beverage Products

Storage areas should be clean, free of infestation, and large enough to allow for easy
rotation of stock. Security is crucial. A two-key system is often used; the individual
responsible for the beverage area has one key while the other key is kept in a sealed
envelope in a secured area. In the event of emergency, the envelope can be opened.

Storing Beverage Products

Spirits should be stored in a relatively dry storage area between 70 and 80F (21 to
27C). Beer in kegs or unpasteurized containers should be stored at refrigeration
temperatures of 36 to 38F (2 to 3C). Canned beer should be covered when stored to
prevent dirt from accumulating on the rim. Pasteurized beer should be stored in a
cool, dark room at 50 to 70F (10 to 21C).

Storing Beverage Products

The three components critical to wine storage are temperature, light, and cork
condition. A tremendously underutilized bottle size is a half-bottle or split, which is
about half the size of the 750 ml bottle. Generally, wines should be stored at a
temperature of 50 to 65F (10 to 18C). Heat is an enemy of effective wine storage.

Storing Beverage Products

When storing wine, it should be exposed only to the minimum amount of light
necessary. The cork protects wine from its greatest enemy, oxygen. Oxidation
occurs when oxygen comes in contact with bottled wine – it smells somewhat like
vinegar. Wine should always be stored in such a way that the cork remains in
contact with the wine to stay moist, usually on its side. Storage should keep the
cork, and thus the wine, cool, dark, and moist.

Bar Transfers

As far as sprits are concerned, nonalcoholic food products may be served as a part
of the drink order and must be transferred from the kitchen to bar. If transfers are
not controlled and recorded, the restaurant’s food cost percentage will be inflated.
Total beverage cost percentage will be understated. Likewise, bar items may be
used in the kitchen and must also be properly noted.

Computing Cost of Beverages

Beginning Inventory PLUS Purchases=Goods Available for Sale

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Less Ending Inventory Transfers from Bar Plus Transfers to Bar= Cost of Beverage
Sold no “employee meals”

Special Features of Liquor Inventory

Opened containers must be counted. Three inventory methods are commonly in

use to accomplish this goal. They are: Weight, Count, Measure

Controlling Food Costs in Receiving, storing and issuing

Three Receiving Standards

Quality

 Receiving same as quality ordered

 Company standards and specification for each item

Quantity

 Receive same amount ordered

 Check against purchase order

Price

 Receive at price quoted at order

Steps for Receiving

Step 1

 Delivery person brings products to receiving area

Step 2

 Check products against the purchase 0rder.

Step 3

 Check products against purchase specifications.

Step 4

 Check delivery quantity against the invoice and the purchase order.
Step 5

 Match invoice prices to purchase order prices.

Step 6

 If everything matches correctly, sign the invoice.

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Step 7

 Put delivered products in proper storage areas.

Step 8

 Process paperwork in keeping with the operation’s standard operating

policies and procedures

Storage Practices Impact Profits

 Spoilage of products

 Theft of products

Sales Needed to Replace the Value of Spoiled or Stolen Items

 Assume 5% restaurant net profit

 Assume loss of two steaks @ $7.00 cost each

Amount
Lost ÷ Net profit percentage= Additional sales required to replace lost
revenue
$14.00 ÷ 0.05 = $280.00

Controlling Spoilage

 Storage loss from spoilage is usually caused by carelessness.

 Spoilage loss can be controlled.
 Spoilage is caused by

 Improper product rotation

 Time abuse
 Temperature abuse

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First In First Out (FIFO)

 Use for refrigerated, frozen, and dry products

 Use oldest product first.
 Relies on

 The receiving clerk (to rotate stock properly)

 The person using the product (to choose properly)

 Must be continually monitored by management!

Dry Storage

Fresh Fruit and Vegetables

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Eggs and Dairy

Meat and Poultry

Fish

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Proper Sanitation is the Key
 Store foods away from walls and at least six inches above the floor.
 Store dry Goods in airtight containers
 Walls and floors should be nonporous and easily cleaned.
 Rotate stock to minimize spoilage.
 Organize products so they are easily found.
 Label shelves and sealed food containers.
 Include “use by” dates and name labels for all stored products.

Controlling Theft

 Keep storage areas locked whenever practical.

 Establish a par stock per shift system for key ingredients.
 Issue secondary sets of keys on an as needed basis only.

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Large foodservice operations may use a requisition system to help control theft-
related losses

Inventory Types

 Physical inventory

 An actual count of inventory items

 Usually taken to obtain information for the

income statement.

 Perpetual inventory

 A count based upon additions to (purchases) and subtractions from

(requisitions) storage
 If records are properly kept, it is always up -to- date.

Common inventory breakdown

 Meats
 Dairy
 Bakery
 Produce
 Frozen foods
 Canned goods
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Common Inventory Breakdown

The type of restaurant you manage will help determine the

specific inventory breakdowns best suited for your use.

Inventory valuation Methods

 FIFO
• First in First out
• Inventory is valued at its most recent (latest) cost.
• Oldest product is used first

 LIFO
• Last in first out
• Inventory is valued at the cost of the oldest product.
• Newest product is used first.

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 Averaged price method

• Inventory is valued at a composite of all prices paid for the item.

 Actual price method

• Each inventory item is valued at its original purchase price.

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 Controlling Food Cost During Production

Developing Sale Forecast

Sales forecasts are determined from sales histories and menu mix. Calculate by
taking the total customer count multiplied by the average check per person.

Determining Quantity to Produce

Accurate food production schedules are important because Overproduction causes
excessive leftovers and waste. Underproduction causes production shortages and
unhappy customers. Both situations reduce profits!

Determining Quantity to Produce continued

To maximize guest satisfaction, managers help their production staff know how
much to prepare on the proper day and at the proper time.

To Ensure Proper Production

Professional managers always use food production charts! Notes: Food production
charts are also called food production schedules.
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Who should be responsible for production scheduling? Possible answers include
Managers, Supervisors, the Chef, and the cooks.

Food Production Charts

Created by studying past sales (sales histories). Generally, the best predictor of
what guests will buy in the future is what they purchased in the past. Created based
upon management’s estimate of future sales If we know the percent of customers
that have previously purchased an item, we can apply that to the new estimated
customers and arrive at the amount to forecast.

When Using Production Charts

Prepare an estimate of the number of guests to be served. Indicate the actual

number of items to be produced. Post the production chart where it can be seen
easily. Instructor’s Notes Ask students where they would find information to help
them estimate future guest counts. Answers may include the POS system, written
sales history records, past guest checks.
Ensure the required standardized recipes are readily available. Periodically check
the actual recipe yield against that listed on the standardized recipe.

Recipe Yields Recipe yields must be known.

Accurate costing of menu items is not possible without known and consistent yields
from standardized recipes. Effective production planning is also impossible without
known recipe yields.

Recipe Yields continued

To calculate a recipe yield, compute the total volume of the recipe by Weight—for
those recipes where portion size is determined by weight. Volume—for those
recipes where portion size is determined by volume. Notes: What is an example of
when a recipe’s yield is computed by weight and when it is computed by volume?

Calculating Recipe Yield

Weigh or measure only the major ingredients. Account for cooking loss, especially
for Meats Vegetables Fruit Instructor’s Notes Ask students to identify some
common food ingredients that “shrink” when cooked, e.g., fresh mushrooms.

Converting and Adjusting Recipes and Formulas

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Recipes often need to be adjusted to meet the needs of different situations. The
most common reason to adjust recipes is to change the number of individual
portions that the recipe produces. For example, a standard recipe might be written
to prepare 25 portions. If a situation arises where 60 portions of the item are
needed, the recipe must be properly adjusted.

Other reasons to adjust recipes include changing portion sizes (which may mean
changing the batch size of the recipe) and better utilizing available preparation
equipment (for example, you need to divide a recipe to make two half batches due
to a lack of oven space).

Conversion Factor Method

The most common way to adjust recipes is to use the conversion factor method.
This requires only two steps: finding a conversion factor and multiplying the
ingredients in the original recipe by that factor.

Finding Conversion Factors

To find the appropriate conversion factor to adjust a recipe, follow these steps:

1. Note the yield of the recipe that is to be adjusted. The number of portions is
usually included at the top of the recipe (or formulation) or at the bottom of
the recipe. This is the information that you HAVE.
2. Decide what yield is required. This is the information you NEED.
3. Obtain the conversion factor by dividing the required yield (from Step 2) by
the old yield (from Step 1). That is, conversion factor = (required
yield)/(recipe yield) or conversion factor = what you NEED ÷ what you
HAVE.

If the number of portions and the size of each portion change, you will have to find
a conversion factor using a similar approach:

A. Determine the total yield of the recipe by multiplying the number of portions
and the size of each portion.
B. Determine the required yield of the recipe by multiplying the new number of
portions and the new size of each portion.
C. Find the conversion factor by dividing the required yield (Step 2) by the
recipe yield (Step 1). That is, conversion factor = (required yield)/(recipe
yield).

24
 Controlling Food Cost During Operation

Portion Control and It’s Importance in Restaurants

Portion Control is the procedure followed that defines the quantity to be utilized in
preparing a dish and then serving it. Standard portions also mean consistency in
the taste, quality, and quantity of food, which eventually results in customer
satisfaction. Controlling portions becomes crucial for the success of any restaurant
as it has a considerable impact on Food Costs. Find out how to keep your Food
Costs in check here.

The tight margin in restaurants and high competition has led to a dire need to
control food costs. Portion control in restaurants is one of the ways you can keep
the Food Costs in check and maintain the overall health of your restaurant. Here is
why portion control in restaurants is necessary.

1. Controls Food Costs

Controlling portion size plays a significant role in keeping the Food Costs in check.
Even a slight imbalance in serving can affect your margins. Ideally, your Food
Costs should be 30% to 40% of the Selling Price of an item.

Calculate your restaurant Food Costs the right way here through this Food Cost
Calculator

25
2. Reduces Wastage

Leftover food that is sent back by the customers is one of the worst types of Food
Wastage as it cannot be recycled. Overserving of food that the customers cannot eat
leads to wastage and ultimately inflated Food Costs. Exercising portion control
helps eliminate this problem. Many restaurants also specify the portion size in the
menu to inform the customers of the quantity to reduce wastage of food.

3. Maintains Consistency

One of the significant reasons why QSRs, especially the Franchise restaurants, are
successful is because they ensure consistency in taste as well as quantity. For most
parts, you can be assured that there would not be any surprises when it comes to
the quality and quantity of food.

Even if you own a Standalone restaurant, the need for portion control still
arises as consistency is the key to providing excellent customer
service. You cannot depend on the whims and guesswork of your Chef or server,
who plate the food as per their estimation. While overserving can increase your
Food Costs, underserving can lead to unhappy customers.

Tips to Control Portion Size

Here are some tried and tested ways to exercise portion control in restaurants-

1. Standardized Recipes

Standard Recipes are essential to the success of any restaurant business. A

Standard Recipe is a set of instructions that are used to prepare and
present a dish. It consists of the quantity of the ingredients to be used, and also
the portion to be served to the guests. Thus, you can know how many people can be
served from one prepared dish beforehand. Apart from the preparing instructions,
Standard Recipes should also include-

 Weight/volume of each ingredient

 Serving size
 Recipe Yield
 Equipment and utensils to be used

2. Right Plating

Much like the Standard Recipes, written plating instructions are also essential for
helping food and controlling portion size. Ask your Chef to put the plating
instructions in writing to eliminate any guesswork. It is also a good idea to have

26
pictures of what the actual dish looks like for reference. Learn how to plate your
meals the right way here.

3. Right Measurement

The most critical part of portion control is using the right measuring tools and
utensils. Portioning utensils such as cups, spoons, ladles, and jiggers come in handy
in preparing as well as serving the dish. It is also essential to use an excellent
commercial kitchen scale for weighing meats and cheese. You can measure
ingredients in three ways-

 Measuring by count- In this way, you can count the number of

elements to be used or served.
 Measuring by volume- In measuring by volume, you can use
measuring spoons, cups, and ladles, etc.
 Measuring by weight- In this way, you use a scale for measuring the
ingredients.
Recipe costing, in this case, comes handy in maintaining consistency and also keeps
a check on the food costs. Find out how to do recipe costing the right way here.

4. Staff Training

All efforts to control portions can go into waste if your kitchen staff is not
adequately trained to execute those measures. The Chef should follow the exact
recipe to keep the quantity balanced. No matter how experienced one is, proper
measuring utensils must be used while preparing the dish. Make sure that your staff
is well trained in serving the food properly on the plate while keeping the portion
size and aesthetics in mind as well.

5. Buying Right

Much of the Portion Control worries can be solved if the right type of raw materials
is purchased in the correct quantity. It is essential to consider the Product
Yield of the item, and the number of portions it would give. Also, keep
track of the fresh and dry ingredients required by the kitchen and their price. It is
also a good idea to purchase part-prepared and ready-prepared items such as meat.
While they can be expensive, you would still save on the labor costs.

Protecting Revenue
Revenue Security

 Product issues

 Guest charges


27
  Sales receipts

 Sales deposits

External Threats to Revenue Security

 Walk or skipped checks

 Occurs often during a busy dining room
 Train employees to be observant.
 Notify management immediately.
 DO NOT physically detain the guest.
 Credit card fraud
 Check name on card with another form of I.D.
 Compare signature on card with the guests.
 Confirm that card is valid and not expired.

Internal Threats to Revenue Security

 Guest Check
 Omission of recording guests order on check.
 Double dropped checks.
 Precheck / post check system
 Employees are prohibited from issuing any
products without a guest check.

Internal Threats to Revenue Security

 Cashier theft
 Coupons.
 Overcharge guests.
 Cash register is short or over.
 Bonding
 Purchasing insurance policy on an employee.

Developing the Revenue Security System

 Verification of product issues

 No product shall be issued from the kitchen or
bar unless a permanent record of issue is made.
 Verification of guest charges
 Product issues must equal guest charges.

Revenue vs. Profit

Revenue is the total amount of income generated by the sale of goods or

services related to the company's primary operations. Profit, which is
typically called net profit or the bottom line, is the amount of income that remains
after accounting for all expenses, debts, additional income streams, and operating
28
costs.

Revenue
Revenue is often referred to as the top line because it sits at the top of
the income statement. The revenue number is the income a company generates
before any expenses are subtracted.

For example, the money a shoe retailer makes from selling its shoes
before accounting for any expenses is its revenue. Income isn't considered revenue
if the company also has income from investments or a subsidiary company. That's
because it doesn't come from the sale of shoes. Additional income streams and
various types of expenses are accounted for separately.

Profit
Profit is referred to as net income on the income statement. But most
people commonly know it as the bottom line. There are variations of profit on the
income statement that are used to analyze the performance of a company.

But there are other profit margins in between the top line (revenue) and bottom
line (net profit). For instance, the term profit may emerge in the context of gross
profit and operating profit. These are steps on the way to net profit.

Gross profit is revenue minus the cost of goods sold (COGS), which are the direct
costs attributable to the production of the goods sold in a company. This amount
includes the cost of the materials used in creating a company's products along with
the direct labor costs used to produce them.

Operating profit is gross profit minus all other fixed and variable expenses
associated with operating the business, such as rent, utilities, and payroll.

Key Differences
When most people refer to a company's profit, they are not referring to
gross or operating profit, but rather net income. This is what's left over after
expenses or the net profit. Keep in mind that it is possible for a company to
generate revenue but have a net loss at the same time.

Let's take a look at J.C. Penney's numbers for 2017, reported on the company's 10-
K annual statement, closing on Feb. 03, 2018. The company suffered a loss on the
bottom line of $116 million, despite earning $12.5 billion in revenue. Losses
typically occur when debts or expenses outstrip earnings, as in the case of J.C.
Penney.

Example of Revenue vs. Profit

Here are the figures and income statement portion for J.C. Penney that we
mentioned above.

 Revenue or Total Net Sales: $12.50 billion

 Gross Profit: $4.33 billion (total revenue of $12.50B – COGS of $8.17B)

29
  Operating Profit: $116 million (minus all other fixed and variable
expenses associated with operating the business, such as rent, utilities, and
payroll)
 Profit or Net income: –$116 million (a loss)

Special Considerations
Accrued revenue is the same as unrealized revenue. Accrued revenue is the
revenue earned by a company for the delivery of goods or services that have yet to
be paid for by the customer.

Here's a hypothetical example to demonstrate accrued revenue. Let's say

a company sells widgets for $5 each on net-30 terms to all of its customers and
sells 10 widgets in August. Since it invoices its customers on net-30 terms, the
company's customers won't have to pay until 30 days later, or on September 30. As
a result, August's revenue will be considered accrued revenue until the company
receives payment from its customers.

From an accounting standpoint, the company would recognize $50 in revenue on

its income statement and $50 in accrued revenue as an asset on its balance sheet.
When the company collects the $50, the cash account on the income statement
increases, the accrued revenue account decreases, and the $50 on the income
statement remains unchanged.

Important: Accrued revenue is not the same as unearned revenue. In

fact, they're actually the opposite of one another.

Unearned revenue accounts for money prepaid by a customer for goods or services
that have not been delivered. If a company requires prepayment for its goods, it
would recognize the revenue as unearned, and would not recognize the revenue on
its income statement until the period for which the goods or services were
delivered.

Can Profit Be Higher Than Revenue?

Revenue sits at the top of a company's income statement, making it the top
line. Profit, on the other hand, is referred to as the bottom line. Profit is lower than
revenue because expenses and liabilities are deducted.

Is Revenue the Same as Sales?

Revenue is commonly referred to as sales. But revenue is any income a
company generates before expenses are subtracted while sales are what the firm
earns from selling goods and services to its customers.

What Is More Important, Profit or Revenue?

While both are important, profit gives a more accurate picture of a
company's financial position. That's because a company's liabilities and other
expenses such as payroll are already accounted for when its profit is calculated.

30
How Much of Revenue Is Profit?
Profit is whatever remains from the revenue after a company account for
expenses, debts, additional income, and operating costs.

The Bottom Line

Revenue and profit are two very important figures that show up on a
company's income statement. While revenue is called the top line, a company's
profit is referred to as the bottom line. Investors should remember that while these
two figures are very important to look at when making their investment decisions,
revenue is the income a firm makes without taking expenses into account. But
when determining its profit, your account for all the expenses a company has
including wages, debts, taxes, and other expenses.

Profit Margin vs. Markup

Profit margin and markup are separate accounting terms that use
the same inputs and analyze the same transaction, yet they show
different information. Both profit margin and markup use revenue and costs as
part of their calculations. The main difference between the two is that profit
margin refers to sales minus the cost of goods sold while markup to the amount by
which the cost of a good is increased in order to get to the final selling price.

An appropriate understanding of these two terms can help ensure that price
setting is done appropriately. If price setting is too low or too high, it can result in
lost sales or lost profits. Over time, a company's price setting can also have an
inadvertent impact on market share, since the price may fall far outside of the
prices charged by competitors.

An understanding of the terms revenue, cost of goods sold (COGS), and gross
profit are important. In short, revenue refers to the income earned by a company
for selling its goods and services. COGS refers to the expenses incurred by
manufacturing or providing goods and services. Finally, gross profit refers to any
revenue left over after covering the expenses of providing a good or service.

Profit Margin
Profit margin refers to the revenue a company makes after paying COGS.
The profit margin is calculated by taking revenue minus the cost of goods sold.
However, the difference is shown as a percentage of revenue. The percentage of
revenue that is gross profit is found by dividing the gross profit by revenue. For
example, if a company sells a product for $100 and it costs $70 to manufacture the
product, its margin is $30. The profit margin, stated as a percentage, is 30%
(calculated as the margin divided by sales).

Important: Profit margin is sales minus the cost of goods sold.

Markup is the percentage amount by which the cost of a product is
increased to arrive at the selling price.

31
Markup
Markup shows how much more a company's selling price is than the
amount the item costs the company. In general, the higher the markup, the more
revenue a company makes. Markup is the retail price for a product minus its cost,
but the margin percentage is calculated differently. In our earlier example, the
markup is the same as gross profit (or $30), because the revenue was $100 and
costs were $70. However, markup percentage is shown as a percentage of costs, as
opposed to a percentage of revenue.

Using the same numbers as above, the markup percentage would be 42.9%, or
($100 in revenue – $70 in costs) / $70 costs.

Profit margin and markup show two aspects of the same transaction. Profit margin
shows profit as it relates to a product's sales price or revenue generated. Markup
shows profit as it relates to costs.

Markup usually determines how much money is being made on a specific item
relative to its direct cost, whereas profit margin considers total revenue and total
costs from various sources and various products.

Margin Calculator
This margin calculator will be your best friend if you want to find out an
item's revenue, assuming you know its cost and your desired profit
margin percentage. That's not all though, you can calculate any of the main
variables in the sales process - cost of goods sold (how much you paid for the
stuff that you sell), profit margin, revenue (how much you sell it for)
and profit - from any of the other values. In general, your profit margin
determines how healthy your company is - with low margins you're dancing
on thin ice and any change for the worse may result in big trouble. High profit
margins mean there's a lot of room for errors and bad luck. Keep reading to find out
how to find your profit margin and what is the gross margin formula.

How to calculate profit margin

1. Find out your COGS (cost of goods sold). For example $30.
2. Find out your revenue (how much you sell these goods for, for example $50).
3. Calculate the gross profit by subtracting the cost from the revenue. $50 - $30
= $20
4. Divide gross profit by revenue: $20 / $50 = 0.4.
5. Express it as percentages: 0.4 * 100 = 40%.
6. This is how you calculate profit margin... or simply use our gross margin
calculator!

As you can see, margin is a simple percentage calculation, but, as opposed to

markup, it's based on revenue, not on Cost of Goods Sold (COGS).

32
Gross margin formula

The formula for gross margin percentage is as follows: gross_margin = 100 *

profit / revenue (when expressed as a percentage). The profit equation is: profit =
revenue - costs, so an alternative margin formula is: margin = 100 * (revenue -
costs) / revenue.

Now that you know how to calculate profit margin, here's the formula for
revenue: revenue = 100 * profit / margin.

And finally, to calculate how much you can pay for an item, given your margin and
revenue (or profit), do: costs = revenue - margin * revenue / 100

A note on terminology

All the terms (margin, profit margin, gross margin, gross profit margin) are a
bit blurry and everyone uses them in slightly different contexts. For example, costs
may or may not include expenses other than COGS - usually, they don't. In
this calculator, we are using these terms interchangeably and forgive us if they're
not in line with some definitions. To us, what's more important is what these
terms mean to most people, and for this simple calculation the differences
don't really matter. Luckily, it's likely that you already know what you need and
how to treat this data. This tool will work as gross margin calculator or a
profit margin calculator.

So the difference is completely irrelevant for the purpose of our calculations - it

doesn't matter in this case if costs include marketing or transport. Most of the time
people come here from Google after having searched for different keywords. In
addition to those mentioned before, they searched for profit calculator, profit
margin formula, how to calculate profit, gross profit calculator (or just gp
calculator) and even sales margin formula.

Margin vs markup

The difference between gross margin and markup is small but

important. The former is the ratio of profit to the sale price and the latter is
the ratio of profit to the purchase price (Cost of Goods Sold). In layman's
terms, profit is also known as either markup or margin when we're dealing with raw
numbers, not percentages. It's interesting how some people prefer to calculate the
markup, while others think in terms of gross margin. It seems to us that markup is
more intuitive, but judging by the number of people who search for markup
calculator and margin calculator, the latter is a few times more popular.

What's the difference between gross and net profit margin?

Gross profit margin is your profit divided by revenue (the raw

amount of money made). Net profit margin is profit minus the price of all
other expenses (rent, wages, taxes etc) divided by revenue. Think of it as the
money that ends up in your pocket. While gross profit margin is a useful
measure, investors are more likely to look at your net profit margin, as it

33
shows whether operating costs are being covered.
Can profit margin be too high?

While a common sense approach to economics would be to

maximize revenue, it should not be spent idly - reinvest most of this
money to promote growth. Pocket as little as possible, or your business will
suffer in the long term! There are also certain practices that, despite short term
profit, will cost you more money in the long run, e.g., importing resources from a
country likely to be subject to economic sanctions in the future, or buying a
property that will be underwater in 5 years.

What is margin in sales?

Your sales margin is the product of the selling price an item or

service, minus the expenses it took to get the product to be sold, expressed as a
percentage. These expenses include: discounts, material and manufacturing costs,
employee salaries, rent, etc. While this is very similar to net profit, sales margin
is in per unit terms.

How do I calculate a 20% profit margin?

1. Express 20% in its decimal form, 0.2.

2. Subtract 0.2 from 1 to get 0.8.
3. Divide the original price of your good by 0.8.
4. There you go, this new number is how much you should charge for a 20%
profit margin.

What is a good margin?

There is no definite answer to "what is a good margin" - the answer you

will get will vary depending on whom you ask, and your type of business.
Firstly, you should never have a negative gross or net profit margin,
otherwise you are losing money. Generally, a 5% net margin is poor, 10% is okay,
while 20% is considered a good margin. There is no set good margin for a new
business, so check your respective industry for an idea of
representative margins, but be prepared for your margin to be lower. For small
businesses, employees are often your main expense.

How do I calculate margin in Excel?

While it's easier to use the Omni Margin Calculator, it is useful to know how to
calculate margin in Excel:

1. Input the cost of goods sold (for example, into cell A1).
2. Input your revenue on the product (for example, into cell B1).
3. Calculate profit by subtracting cost from revenue (In C1, input =B1-A1) and
label it “profit”.
4. Divide profit by revenue and multiply it by 100 (In D1, input
=(C1/B1)*100) and label it “margin”.
34
 5. Right click on the final cell and select Format Cells.
6. In the Format Cells box, under Number, select Percentage and specify
your desired number of decimal places.

How do I calculate a 10% margin?

1. Make 10% a decimal by dividing 10 by 100 to get 0.1.

2. Take 0.1 away from 1, equaling 0.9.
3. Divide how much your item cost you by 0.9.
4. Use this new number as your sale price if you want a 10% profit margin.

Are margin and profit the same?

Although both measure the performance of a business, margin and profit are
not the same. All margin metrics are given in percent values, and therefore
deal with relative change, good for comparing things that are operating on a
completely different scale. Profit is explicitly in currency terms, and so provides
a more absolute context - good for comparing day to day operations.

How do I calculate a 30% margin?

1. Turn 30% into a decimal by dividing 30 by 100, which is 0.3.

2. Minus 0.3 from 1 to get 0.7.
3. Divide the price the good cost you by 0.7.
4. The number that you receive is how much you need to sell the item for to get
a 30% profit margin.

How do I calculate markup from margin?

1. Turn your margin into a decimal by dividing the percentage by 100.

2. Subtract this decimal from 1.
3. Divide 1 by the product of the subtraction.
4. Subtract 1 from product of the previous step.
5. You now have markup expressed in decimal form!
6. If you want to have markup in percentage form, multiply the decimal by 100

The following are the wholesaler’s and retailer’s markups for the
fixing of the ceiling prices of the commodities hereunder listed:

Commodity Wholesaler’s markup above Retailer’s markup above

landed cost wholesaler’s price
1. Bulk Food 10% 15%
2. Canned Milk 10% 15%
3. Canned Meat or Fish 10% 20%
4. Canned Vegetables or 15% 25%
Fruit
5. Bread or Pan de sal - 25%
6. Other food 15% 25%

35
7. Steel and Iron, heavy; 15% 20%
Building materials
8. Hardware, Nails, Wire, 15% 25%
Tools
9. Plumbing and Electrical 20% 25%
Fixtures
10. Textiles 15% 25%
11. Clothing, old or new 20% 30%
Shoes
12. Drugs and Medical 20% 30%
Supplies
13. Industrial Chemicals 15% -
14. Medical Equipment 20% 30%
15. Liquor 25% 25%
16. Jewelry, Novelties, 40% 60%
Toys
17. Tobacco Products 15% 20%
18. Miscellaneous Building 15% 25%
Materials
19. Paper Products, 20% 25%
Stationary and Alcohol
Supplies
20.Newsprint 15% -
21. Machinery, Industrial 15% 20%
and Office
22. Automobiles, Trucks 20% 30%
and Automotive
Equipments and Parts
23. Philippine-made 20% 30%
Handicraft Articles
24. All other products not 20% 15-30%
specifically mentioned
Source: Executive Order No. 62, signed on August 14, 1945

36
Activities/ Exercises

MENU COSTING AND PRICING

Instructions: Create a full course menu with four (4) options for each meal
(appetizer, soup, main course, and dessert) and cost it out for ten (10) people.
Indicate how much each meal will cost per customer. (5 points each meal)
Example:
SCRAMBLED EGGS COSTING
Unit Quantity Ingredients Price per Unit Cost
ml 30 Cooking Oil ₱ 35.00 (200ml) ₱ 3.00
pieces 4 Eggs ₱ 8.00 ₱ 32.00
grams 2 Iodized Salt ₱ 60.00 ₱ 0.12
Total ₱ 35.12
Q Factor (10%) ₱ 3.51
Total Recipe Cost ₱ 38.63
Mark Up (25%) ₱ 9.66
Cost Per Serving ₱ 15.09
20% Profit Margin ₱ 13.04
SUGGESTED RETAIL PRICE ₱ 60.36

Evaluation/ Post Test

Part 1. Creative Writing/Discussion

Instruction: This is a test of your writing skills. Write your answer below
each question. Your essay will be evaluated based on your ability to analyze,
evaluate, explain and support your ideas, and your logical reasoning. Refer to
rubric for your reference.

1. Discuss the difference between Revenue and Profit. (5 points)

2. Discuss the difference between Mark up and Margin. (5 points)

3. Discuss the difference between Gross profit and Operating profit. (5 points)

Part 2. Discussion

1. How do you calculate the following? (5 points for each correct answer)
 Profit margin
 Gross margin
 Mark up

37
Rubric for Creative Writing.
Needs Satisfactory Excellent
Improvement
Indicator (3) (5)
(1)
Content/ Paper has no The writer is The paper is clear and
Substance 0f clear sense of beginning to focused. It holds the
Answer central theme. define the topic attention of the reader.
Topic is not well and provided Relevant details and
(40%)
defined and additional additional information
discussed information, provided enrichment to
even though the theme.
development
can still be
done.
Organization of The writing lacks The The organization
Thoughts and clear sense of organizational enhances and
Delivery (30%) direction. There structure is showcases the central
is no identifiable strong enough idea. The structure of
structure of to move the information is
answer. reader without compelling and moving
too much for the reader.
confusion.
Information
presented are
somewhat
organized and
clear.
Sentence The writing is not The writing The writing has an easy
Fluency and easy to read invites oral flow and cadence.
Quality of orally and does reading, but Sentences are well built
writing (20%) not have fair tends to be and demonstrates a
interpretive more good grasp of standard
reading. mechanical of writing conventions
than fluid. (e.g. spelling
punctuation, grammar
and usage) that invites
expressive oral reading.
Presentation The paper is The format The form and the
(10%) messily written. only has a few presentation of the next
It lacks images mistakes and is enhances the ability for
that may support generally easy the reader to
the ideas. to read and understand and connect
pleasing to the with the message. The
eye. Images writer provided images

38
 provided to that support the central
illustrate the theme.
idea are
somewhat
related.

REFERENCES

1. Dopson, L., Hayes, D. (2015) John Wiley & Sons Inc, Food and Beverage 6th
Edition, New York United States,
2. Pearsons (2013) Controlling Service Costs, 2nd edition, National Restaurant
Association
3. Claire Boyte-White (2021),
https://www.investopedia.com/ask/answers/122214/what-difference-between-
revenue-and-profit.asp
4. David Kindness, Michael Logan (2021),
https://www.investopedia.com/ask/answers/102714/whats-difference-
between-profit-margin-and-markup.asp
5. Mateusz Mucha and Tibor Pal, PhD candidate (2022),
https://www.omnicalculator.com/finance/margin#how-to-calculate-profit-
margin

39
 Congratulations for completing this
module!

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All personal information collected will be stored in a secure location and only authorized
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Student’s Information

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40
WPU-QSF-ACAD-82A Rev. 00 (09.15.20)
 Vision 2020
WPU: the leading knowledge center for
sustainable development of West
Philippines and beyond.

Mission
WPU commits to develop quality human resource and
green technologies for a dynamic economy and
sustainable
development through relevant instruction, research
and extension services.

3 Core Values
Culture of Excellence
Commitment Creativity
Teamwork

WPU-QSF-ACAD-82A Rev. 00 (09.15.20)