Managing First Controlling Foodservice Costs – Final Exam
Review (200 Practice Questions with Answers and
Explanations)
Question 1: A healthy food cost percentage for a full-service restaurant typically ranges between:
A) 10-15%
B) 20-35%
C) 40-50%
D) 50-60%
Answer: B
Rationale: Acceptable food cost percentages vary by restaurant concept. Full-service restaurants
generally target 20-35% food cost, with fine dining at the higher end (30-35%) due to premium
ingredients and pricing.
Question 2: A restaurant pays $5,000 per month in rent regardless of how many customers are served.
This is an example of what type of cost?
A) Variable cost
B) Fixed cost
C) Semi-variable cost
D) Prime cost
Answer: B
Rationale: Fixed costs remain constant regardless of sales volume within a relevant range. Rent,
insurance, property taxes, and management salaries are typical fixed costs in foodservice operations.
,Question 3: The cost of food used to prepare a specific menu item that changes directly with the
number of items sold is a:
A) Fixed cost
B) Variable cost
C) Sunk cost
D) Controllable fixed cost
Answer: B
Rationale: Variable costs increase or decrease in direct proportion to sales volume. Food cost per item
and hourly wages are classic examples of variable costs.
Question 4: A restaurant's utility bill has a base charge of $200 plus additional charges based on usage.
This cost is classified as:
A) Fixed cost
B) Variable cost
C) Semi-variable (mixed) cost
D) Indirect cost
Answer: C
Rationale: Semi-variable costs have both a fixed component (base charge) and a variable component
(usage-based charges). Telephone bills and some labor costs also fall into this category.
Question 5: Prime cost in foodservice consists of:
A) Food cost + beverage cost
B) Cost of goods sold + operating expenses
,C) Cost of goods sold + direct labor cost
D) Fixed costs + variable costs
Answer: C
Rationale: Prime cost = total cost of goods sold (food + beverage) + total direct labor cost (including
benefits). These are the two largest controllable expenses in foodservice.
Question 6: Which of the following is considered a controllable cost?
A) Property taxes
B) Rent
C) Food cost
D) Depreciation
Answer: C
Rationale: Controllable costs are those that management can directly influence through decisions and
actions. Food cost can be controlled through purchasing, portioning, and waste reduction. Property
taxes, rent, and depreciation are generally non-controllable.
Question 7: The formula for calculating food cost percentage is:
A) Food Sales ÷ Food Cost × 100
B) Food Cost ÷ Food Sales × 100
C) (Food Sales – Food Cost) ÷ Food Sales × 100
D) Food Cost ÷ Total Sales × 100
Answer: B
, Rationale: Food cost percentage = (Cost of Food Sold ÷ Food Sales) × 100. This calculation shows what
portion of sales revenue goes toward ingredient costs.
Question 8: What is the formula for calculating menu selling price given desired food cost percentage?
A) Selling Price = Food Cost × Desired Food Cost %
B) Selling Price = Food Cost ÷ Desired Food Cost %
C) Selling Price = Food Cost × 100
D) Selling Price = Food Cost × Pricing Factor
Answer: B
Rationale: To determine menu price, divide the item's food cost by the desired food cost percentage.
The pricing factor equals 100 ÷ desired food cost percentage, so selling price = food cost × pricing factor.
Question 9: A menu item has a food cost of $4.50 and the restaurant targets a 30% food cost
percentage. What should the selling price be?
A) $13.50
B) $15.00
C) $12.00
D) $14.00
Answer: B
Rationale: Selling Price = Food Cost ÷ Desired Food Cost % = $4.50 ÷ 0.30 = $15.00. The pricing factor is
100 ÷ 30 = 3.33, so $4.50 × 3.33 = $15.00.
Question 10: Standard portion cost is defined as:
Review (200 Practice Questions with Answers and
Explanations)
Question 1: A healthy food cost percentage for a full-service restaurant typically ranges between:
A) 10-15%
B) 20-35%
C) 40-50%
D) 50-60%
Answer: B
Rationale: Acceptable food cost percentages vary by restaurant concept. Full-service restaurants
generally target 20-35% food cost, with fine dining at the higher end (30-35%) due to premium
ingredients and pricing.
Question 2: A restaurant pays $5,000 per month in rent regardless of how many customers are served.
This is an example of what type of cost?
A) Variable cost
B) Fixed cost
C) Semi-variable cost
D) Prime cost
Answer: B
Rationale: Fixed costs remain constant regardless of sales volume within a relevant range. Rent,
insurance, property taxes, and management salaries are typical fixed costs in foodservice operations.
,Question 3: The cost of food used to prepare a specific menu item that changes directly with the
number of items sold is a:
A) Fixed cost
B) Variable cost
C) Sunk cost
D) Controllable fixed cost
Answer: B
Rationale: Variable costs increase or decrease in direct proportion to sales volume. Food cost per item
and hourly wages are classic examples of variable costs.
Question 4: A restaurant's utility bill has a base charge of $200 plus additional charges based on usage.
This cost is classified as:
A) Fixed cost
B) Variable cost
C) Semi-variable (mixed) cost
D) Indirect cost
Answer: C
Rationale: Semi-variable costs have both a fixed component (base charge) and a variable component
(usage-based charges). Telephone bills and some labor costs also fall into this category.
Question 5: Prime cost in foodservice consists of:
A) Food cost + beverage cost
B) Cost of goods sold + operating expenses
,C) Cost of goods sold + direct labor cost
D) Fixed costs + variable costs
Answer: C
Rationale: Prime cost = total cost of goods sold (food + beverage) + total direct labor cost (including
benefits). These are the two largest controllable expenses in foodservice.
Question 6: Which of the following is considered a controllable cost?
A) Property taxes
B) Rent
C) Food cost
D) Depreciation
Answer: C
Rationale: Controllable costs are those that management can directly influence through decisions and
actions. Food cost can be controlled through purchasing, portioning, and waste reduction. Property
taxes, rent, and depreciation are generally non-controllable.
Question 7: The formula for calculating food cost percentage is:
A) Food Sales ÷ Food Cost × 100
B) Food Cost ÷ Food Sales × 100
C) (Food Sales – Food Cost) ÷ Food Sales × 100
D) Food Cost ÷ Total Sales × 100
Answer: B
, Rationale: Food cost percentage = (Cost of Food Sold ÷ Food Sales) × 100. This calculation shows what
portion of sales revenue goes toward ingredient costs.
Question 8: What is the formula for calculating menu selling price given desired food cost percentage?
A) Selling Price = Food Cost × Desired Food Cost %
B) Selling Price = Food Cost ÷ Desired Food Cost %
C) Selling Price = Food Cost × 100
D) Selling Price = Food Cost × Pricing Factor
Answer: B
Rationale: To determine menu price, divide the item's food cost by the desired food cost percentage.
The pricing factor equals 100 ÷ desired food cost percentage, so selling price = food cost × pricing factor.
Question 9: A menu item has a food cost of $4.50 and the restaurant targets a 30% food cost
percentage. What should the selling price be?
A) $13.50
B) $15.00
C) $12.00
D) $14.00
Answer: B
Rationale: Selling Price = Food Cost ÷ Desired Food Cost % = $4.50 ÷ 0.30 = $15.00. The pricing factor is
100 ÷ 30 = 3.33, so $4.50 × 3.33 = $15.00.
Question 10: Standard portion cost is defined as:
