Which statement is correct? Total amount of money a food service operation spends on food and beverage divided by the total food and beverage sales expressed in percentage is the o... Which statement is correct? Total amount of money a food service operation spends on food and beverage divided by the total food and beverage sales expressed in percentage is the overall food cost percentage; Overall cost percentage are defined within a day; Food service operations does not calculate the overall cost percentage; There are no correct statements; All statements are correct; Overall cost percentage are solely based on food sales. Read more

Understand the Problem

The question is asking to identify which of the provided statements about food service operations and cost percentages is correct. It requires understanding the financial metrics used in food and beverage sales.

More Information

The overall food cost percentage is a key metric used by food service operations to assess how much of their revenue is being spent on food and beverage supplies. This calculation helps businesses manage and optimize their inventory and purchasing processes to increase profitability.

Tips

A common mistake is misunderstanding the components of the formula. Remember to divide the cost of food and beverages by total sales, not the other way around.

Sources

• How to Calculate Food Cost Percentage with Food Cost Formula - touchbistro.com
• Chapter 12 – Analyzing and Managing Food & Beverage Expense - psu.pb.unizin.org
• The Basic Calculation of Operating Costs - opentextbc.ca