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49 Cards in this Set

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what is the formula for EP cost per pound?
AP Price divided by EP % = EP cost per pound
what is the formula for waste %?
waste% = product loss divided by AP weight
what is the formula for AP required, or the amount you need to purchase?
EP required divided by EP% = AP required
what is the formula for EP required, or the amount that is edible?
EP required = AP required x EP%
what is the formula for yield?
EP% = 1.00 - waste%
what does EP weight divided by AP weight give you?
EP%
a purchase order is what kind of control?
primary, used throughout purchasing, receiving and the accounts payable process.
what is a purchase order?
a form listing products to be purchased, price, delivery date and other data
what does the purchase order include?
unique number to identify it
name of ordering restaurant and contacts
date of order
signature of person placing order
supplier's name and contacts
date of delivery, terms of payment
each item purchased, quantity, unit, unit cost, extended cost
total cost of order
buyer sends copies of the purchase order where?
to supplier

to receiving clerk

clerk notes what has been sent and sends it on to accounting
what is accounting's role with the purchase order?
compare the purchase order to supplier's invoice to determine correct amount to pay supplier
what is a mandatory control in every restaurant?
purchase order
what are "competitive quotes"?
common purchasing method used by independents and smaller operations.

Buyer completes a market quotation sheet with items and specs and sends it to 2 or more suppliers for price quotes
what are quotes?
prices cited by purveyors for a specific product

specs must be established, or else anything could be shipped
what is a standing order?
usually for bakery, coffee and dairy products where the restaurant establishes par stock for each item and supplier brings delivery to keep par stock at correct levels from one delivery to the next
what is par stock?
the level that must be kept in stock from one delivery to the next
how do you determine par stock levels?
1. determine time between deliveries
2. determine estimated amount used during this period
3. add safety factor
4. add estimated product used plus safety factor to get par stock amount needed
5. place label with amount of par stock on that item's shelf in storage
what's a drawback about using the standing order method?
easily abused

manager must ensure delivery person shows manager items being removed and those brought in
what is one-stop shopping?
the method becoming the most popular, in which you purchase goods from one supplier
what's the downside of the one-stop shopping method?
pricing might not be as competitive, and if the purveyor is out of an item, you don't have an easy backup
what is the cost plus method?
method used by chains, where they buy 100% of a product from one purveyor who sells at invoice price plus an AGREED UPON percentage
what are sealed bids?
method used by large food-service units such as schools, colleges, hospitals, institutions, agencies. The supplier bids on a product that will be used over a long period of time.
what is the commissary method?
method used by chains, franchise units where 100% of their goods come from a commissary, where orders for individual units are consolidated

Includes refrigerated, frozen, packaged and premade items
List some of the controls and safeguards . . .
specs
purchase order
price comparison
sound receiving practices
calculating EP cost helps you more accurately determine what?
which supplier's price is best for your needs
what does a yield chart give?
a register that gives EP weight of products as opposed to AP weight

average yield percent
what is a yield test?
an analysis to determine the difference between a product's AP weight and EP weight.

the most accurate way to find out
to find yield percent in a yield test, weigh the product when it arrives. The result is the AP weight. Trim, then weigh the product again. Divide the EP weight by what to get the EP%?
AP weight
by using a yield test and calculating EP cost, you can find the real cost of a product, true or false?
true
what are some influences on prices the supplier quotes you?
how quickly your restaurant pays its bills

whether supplier discounts if you pay in cash
what are the 2 categories of goods to purchase?
perishable - 1-3 days of shelf life

nonperishable - a few months to a year of shelf life if stored properly
what are some factors affecting purchase of nonperishables?
size of storage available
cash flow
location (urban or rural)
how often you buy (weekly, bimonthly, monthly)
It is necessary to take inventory each time you buy perishables, true or false?
true
you should only buy the amount of perishables you need until the next delivery, true or false?
true

(unless management specifies wanting a certain safety factor)
what are the 2 categories of goods to purchase?
perishable - 1-3 days of shelf life

nonperishable - a few months to a year of shelf life if stored properly
what are some factors affecting purchase of nonperishables?
size of storage available
cash flow
location (urban or rural)
how often you buy (weekly, bimonthly, monthly)
It is necessary to take inventory each time you buy perishables, true or false?
true
you should only buy the amount of perishables you need until the next delivery, true or false?
true

(unless management specifies wanting a certain safety factor)
what is a bid sheet?
a listing of items needed, used to get price quotes from suppliers
what are the steps in determining amount to purchase?
determine amount needed until next delivery

inventory what's on hand

subtract inventory from what's needed

result is amount to purchase
only use the standing order method on perishables if what?
if supplier agrees to give credit for excess inventory
when goods arrive, put them away promptly to avoid what?
shrinkage
spoilage
theft
proper receiving means checking goods delivered against the purchase order and the invoice for what?
count
weight
price
quality against the specs
what are needed to help the buyer make critical decisions?
calculating AP and EP
conducting butcher tests
knowing when to purchase
what are 2 critical controls?
specifications

purchase order

together they tie the purchasing, receiving and accounting functions
what's an important receiving objective?
make sure you have:

correct product
quality
quantity
When receiving a shipment, you must check the math on the invoice even if computer generated, true or false?
true, because humans input the info.

compare price on invoice with those on the purchase order to ensure they match.
what are some quality checks you'll do when receiving goods?
open boxes, check for freshness, color, size, degree of ripeness

take temperatures of meat, seafood, poultry, fish, dairy, frozen goods. If items were ordered by count, count them. If by weight, weigh them.
on a butcher test, how do you get the retail value?
contact supplier for current price