Hospitality Industry Cost Control

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Questions and Answers

Which of the following is NOT a part of the expanded system model of an organization?

Networking (correct)

Output

Transformation

Input

The control element in a system only focuses on feedback mechanisms.

False

What does transformation refer to in the context of an organization?

It involves any action or activity used in changing inputs into outputs.

The three functions of the control element ensure resources are used effectively, comply with __________, and provide standards for evaluation.

regulatory constraints Signup and view all the answers

What is included in the definition of input in a system?

Raw materials Signup and view all the answers

Match the following terms with their definitions:

Input = Resources required to accomplish objectives Transformation = Process of changing inputs into outputs Output = Result of the transformation process Feedback = Information used to make adjustments to the system Signup and view all the answers

Environment factors do not influence the operations of an organization.

False Signup and view all the answers

Name one activity that is part of the transformation process.

Quality check Signup and view all the answers

Which component of internal control includes the goals and objectives of the organization?

Plans Signup and view all the answers

External control refers to regulations and contracts defined by the organization itself.

False Signup and view all the answers

What does food service management encompass?

Planning, managing, organizing, and controlling food service operations. Signup and view all the answers

_____ is a function of revenue and expenses.

Profit Signup and view all the answers

Match the following components with their descriptions:

Revenue = Money generated from sales Expenses = Costs incurred in the operation Loss = When expenses exceed revenue Profit = Surplus when revenue exceeds expenses Signup and view all the answers

Which of the following is NOT considered an environmental factor?

Market trends Signup and view all the answers

Memory in a food service system includes historical records of the system’s operations.

True Signup and view all the answers

What is a loss in a business context?

A situation where expenses outpace revenue. Signup and view all the answers

What is a consequence of over purchasing in a foodservice business?

Product spoilage Signup and view all the answers

Receiving is the process where employees confirm that the food received matches the purchase order.

True Signup and view all the answers

What is the primary purpose of employee scheduling in foodservice?

To achieve cost savings and efficiency. Signup and view all the answers

Effective _____ helps prevent undetected theft in foodservice operations.

issuing Signup and view all the answers

Which type of costs is included in utilities expenses?

Payment for gas and electricity Signup and view all the answers

Waste through production is always due to poor management.

False Signup and view all the answers

Match the following concepts with their descriptions:

Sales Control = Ensured profitability of food dishes Forecasting = Analyzing historical sales data Recipe Production = Using standardized recipes to control costs Receiving = Confirming food matches ordered items Signup and view all the answers

Which aspect is NOT part of food flow in a foodservice business?

Employee Scheduling Signup and view all the answers

What type of costs includes rent, property taxes, and property insurance?

occupational costs Signup and view all the answers

Standardized recipes are used to minimize waste and control costs in a kitchen.

True Signup and view all the answers

The cost that arises from borrowing money is known as ______.

interest Signup and view all the answers

Which of the following is an example of spoilage?

Food going bad before preparation Signup and view all the answers

What does stock rotation help minimize in foodservice?

Loss from spoilage Signup and view all the answers

Match the type of expense with its description:

Food Costs = Costs of ingredients for food sales Utilities = Payments for gas, electric, and water Repair and Maintenance = Costs for maintaining facilities and equipment Administrative Costs = Supplies and infrastructure costs in an office Signup and view all the answers

What are the three forms of waste through production?

Trimming too much of an ingredient, cooking or cutting errors, poor portion control Signup and view all the answers

Which of the following is NOT a part of the cost control cycle?

Employee training Signup and view all the answers

What is one benefit of increasing the budget for marketing and advertising?

More efficient operations Signup and view all the answers

Cost control measures can potentially eliminate inefficiencies in operations.

True Signup and view all the answers

What does a market price survey compare?

An establishment's purchase prices against outside market prices. Signup and view all the answers

A company's competitive advantage relies on maintaining an efficient __________.

operation Signup and view all the answers

Match the terms with their definitions:

Cost Control = Mechanism to manage costs effectively Market Price Survey = Comparison of purchase prices Standard Costing = Economic tool for cost evaluation Consumption vs. Sales Tests = Comparison of usage with sales figures Signup and view all the answers

What should be considered when judging which source gives a more competitive price?

Quality and payment terms Signup and view all the answers

Improving competitive advantage makes an operation less efficient.

False Signup and view all the answers

What action should be taken if there is a significant difference between actual test results and standard specifications?

Take action to address the difference. Signup and view all the answers

Study Notes

Cost Control and Transformation in Hospitality

The output in an organization represents the achievement of system goals through the transformation of inputs.
Key components of an organization's system model include input, transformation, output, control, memory, environmental factors, and feedback.
Input comprises human, physical, and operational resources like raw materials, manpower, and specifications.

Transformation and Control Functions

Transformation involves actions that change inputs into outputs, often requiring quality checks to ensure standards are met.
Control ensures efficient use of resources, legal compliance, and operation evaluation through established standards.
Internal control includes organization goals, standards, and policies, while external control consists of regulations from governing bodies.

Importance of Memory and Environmental Factors

Memory in a system stores historical information, aiding in planning and learning from past experiences.
Environmental factors, such as technology, competition, and demographic changes, impact the system but are external influences.

Financial Aspects of the Hospitality Industry

Profit is generated when revenue exceeds expenses, while loss occurs when expenses surpass revenue.
Essential expense categories include food costs, utilities, repair and maintenance, equipment purchases, administrative costs, occupational costs, and interest on loans.

Waste Management and Cost Control Cycle

Waste in production often results from poor training and can occur in forms such as spoilage, inefficient cutting, and portion control.
Effective cost control cycles encompass purchasing, receiving, issuing, and maintaining food and service quality to minimize losses.

Key Purchasing and Storage Practices

Effective purchasing determines the correct quantity and quality of food at the right time and place, preventing over-purchasing and spoilage.
Proper receiving and storage begin with confirming that orders match invoices, promoting accurate inventory management.

Sales Control and Employee Scheduling

Sales control requires ensuring that menu pricing covers ingredient, labor, and overhead costs while still generating profit.
Efficient employee scheduling can lead to significant cost savings, reflecting the importance of labor management in foodservice operations.

Forecasting and Operational Efficiency

Forecasting utilizes historical sales data to improve operational performance, targeting inefficiencies in food flow.
Continuous evaluation and measurement of performance contribute to reducing costs and enhancing service effectiveness.

Competitive Advantage and Market Pricing

Companies must maintain operational efficiency to achieve a competitive advantage in the hospitality industry.
Regular market price surveys help establishments compare their purchase prices to competitors, aiming for cost effectiveness.

Standard Costing and Marketing Strategies

Standard costing is used as an economic tool for reducing waste and pinpointing inefficiencies.
Increased budgets for marketing and advertising are critical for driving sales growth and maintaining profitability.

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Description

This quiz covers the fundamentals of cost control and the significance of outputs in the hospitality industry. It explores how activities involved in food production can influence overall efficiency and effectiveness. Understanding the systems model and the importance of having the right personnel for optimal job performance is also discussed.

Hospitality Industry Cost Control

Podcast Beta

Questions and Answers

Which of the following is NOT a part of the expanded system model of an organization?

The control element in a system only focuses on feedback mechanisms.

What does transformation refer to in the context of an organization?

The three functions of the control element ensure resources are used effectively, comply with __________, and provide standards for evaluation.

What is included in the definition of input in a system?

Match the following terms with their definitions:

Environment factors do not influence the operations of an organization.

Name one activity that is part of the transformation process.

Which component of internal control includes the goals and objectives of the organization?

External control refers to regulations and contracts defined by the organization itself.

What does food service management encompass?

_____ is a function of revenue and expenses.

Match the following components with their descriptions:

Which of the following is NOT considered an environmental factor?

Memory in a food service system includes historical records of the system’s operations.

What is a loss in a business context?

What is a consequence of over purchasing in a foodservice business?

Receiving is the process where employees confirm that the food received matches the purchase order.

What is the primary purpose of employee scheduling in foodservice?

Effective _____ helps prevent undetected theft in foodservice operations.

Which type of costs is included in utilities expenses?

Waste through production is always due to poor management.

Match the following concepts with their descriptions:

Which aspect is NOT part of food flow in a foodservice business?

What type of costs includes rent, property taxes, and property insurance?

Standardized recipes are used to minimize waste and control costs in a kitchen.

The cost that arises from borrowing money is known as ______.

Which of the following is an example of spoilage?

What does stock rotation help minimize in foodservice?

Match the type of expense with its description:

What are the three forms of waste through production?

Which of the following is NOT a part of the cost control cycle?

What is one benefit of increasing the budget for marketing and advertising?

Cost control measures can potentially eliminate inefficiencies in operations.

What does a market price survey compare?

A company's competitive advantage relies on maintaining an efficient __________.

Match the terms with their definitions:

What should be considered when judging which source gives a more competitive price?

Improving competitive advantage makes an operation less efficient.

What action should be taken if there is a significant difference between actual test results and standard specifications?

Study Notes

Cost Control and Transformation in Hospitality

Transformation and Control Functions

Importance of Memory and Environmental Factors

Financial Aspects of the Hospitality Industry

Waste Management and Cost Control Cycle

Key Purchasing and Storage Practices

Sales Control and Employee Scheduling

Forecasting and Operational Efficiency

Competitive Advantage and Market Pricing

Standard Costing and Marketing Strategies

Studying That Suits You

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