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Quality Control Presentation
Transcript of Quality Control Presentation
& Financial Account Management Presented by : Sylvia Widjaya / 00049941T Topics to be covered Why is Financial Information important for Restaurant Managers ? To manage activities involving money that is earned and spent in the operation of their business. Financial Accounting The process of developing and using accounting information to make business decisions, which involves organizing and presenting financial information in financial statements. Managerial Accounting The process of using historical and estimated financial information to help managers plan for the future.
E.g should the restaurant open or close on a specific day? Calculating Sales & Food Costs The purpose is to identify how the actual costs compare to the forecast or standard costs. There are 4 rules (Ninemeier, 2009: 301) :
Actual costs must be stated in the same manner as standard costs (e.g % or $).
Both cost must cover the same meal periods.
All factors that were used to calculate standard costs must be used in the calculation of actual costs
Actual costs must be assessed on a timely basis. Calculating Inventory There are 3 methods for calculating inventory. 1. FIFO 2. LIFO 3. Weighted-average cost How inventory affects Profit & Sales The First-In-First-Out Method (FIFO) This method assumes that the first inventories bought are the first ones to be sold, and that inventories bought later are sold later. The use of this method is very common in the restaurant industry since most of the products are perishable, the oldest goods need to be sold before they pass their sell-by date. For example,
A bakery produces 200 loaves of bread on Monday at a cost of $1 each,
and 200 more on Tuesday at $1.25 each.
FIFO states that if the bakery sold 200 loaves on Wednesday,
the COGS is $1 per loaf (recorded on the income statement) because that was the cost of each of the first loaves in inventory.
The $1.25 loaves would be allocated to ending inventory. The Last-In-First-Out Method (LIFO) This method assumes that the last inventories bought are the first ones to be sold, and that inventories bought first are sold last. For the 200 loaves sold on Wednesday, the same bakery would assign $1.25 per loaf to COGS, while the remaining $1 loaves would be used to calculate the value of inventory at the end of the period. The Weight Average Cost Method This method takes the weighted average of all units available for sale during the accounting period and then uses that average cost to determine the value of COGS and ending inventory. In our bakery example, the average cost for inventory would be $1.125 per unit,
calculated as [(200 x $1) + (200 x $1.25)]/400. The Post Operation Phase The 3 stages involved in food and beverage control include: 1. F&B Cost Reporting 2. Assessment 3. Correction compare with the forcasted and actual report management decision making to solve the problem Why is Financial Information important for Restaurant Managers?
Calculating the Food Cost $
Calculating Inventory (FIFO,LIFO, Weight Average Cost)
The Post Operational Phase (Cost Reporting, Cost Assessment and Cost Correction The Formula
Food Cost % = (Beginning Inventory+Purchases - Ending Inventory) /Food Sales
FC% = (BI + P - EI) / S
$10,000 Beginning Inventory, $2000 in Purchases, $10,500 Ending Inventory, $5000 in Sales. Software : Reference List Restaurant Financial Basics. Raymond S. Schmidgall, David K. Hayes, Jack D. Ninemeier. 2002. Page 2-4. http://www.oldschoolvalue.com/blog/valuation-methods/fifo-lifo-average-inventory-valuation/
http://www.starchefs.com/cook/business-tips/how-to-calculate-food-cost http://www.foodsoftware.com/Product_0004_01.asp?Keyword=&ViewMode=&NavURLs=%2FProduct_0050.asp%7CProduct_0004_01.asp%3FKeyword%3D%26ViewMode%3D&NavNames=QuickPlan+for+Pizza+Restaurants+%26+IPro+Bundle+Special+Offer%7CIPro+Details+Page+1+-+Home Buergermeister, J. (2000). Point-of-sale technology for foodservice: underutilized
power tool or disappointing over achiever. International Journal of Hospitality Information
Technology, 1 (2), 9-20. Week 10, Study Guide. 2012. Page 82-90 Thank You for Listening Why would Retail Hospitality use MYOB? http://myob.com.au/products/small-business/retail-hospitality/retailhospitality-1258090694625