Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
67 Cards in this Set
- Front
- Back
|
what is payroll cost?
|
amount of money spent for employee wages, both fixed (salaried) and variable (hourly)
|
|
|
payroll cost is what kind of cost?
|
variable - increasing and decreasing in direct proportion to sales
|
|
|
combining fixed (management) payroll cost with variable (hourly) payroll cost results in what kind of cost?
|
semivariable payroll cost
|
|
|
labor cost is more than money spent on salaries and wages. It includes what?
|
Fica
medicare worker's comp unemployment insurance employee benefits |
|
|
payroll cost is the gross, not net, total of paychecks before what is deducted?
|
taxes
|
|
|
What does FICA stand for?
|
Federal Insurance Contributions Act - for retirement and medical benefits, which employees and employers both pay
|
|
|
the FICA contribution rate is what?
|
6.2%, plus another 1.5% for Medicare for a total of 7.7%
|
|
|
what are employee benefits?
|
benefits given by the employer that have monetary value but don't affect basic wage rate
|
|
|
what do you add to get total labor cost?
|
payroll costs plus FICA, Medicare and benefits
|
|
|
Management is most concerned about which relationship?
|
between labor costs and sales
|
|
|
how do you calculate labor cost %?
|
labor cost divided by sales = labor cost%
|
|
|
to calculate estimated daily payroll cost% do what?
|
weekly fixed cost divided by 7 (if for 7 days a week) = daily fixed cost%
daily fixed cost% + daily variable payroll cost = total daily payroll cost total daily payroll cost divided by anticipated sales = estimated daily payroll cost% |
|
|
what is a budget?
|
projection of sales, costs, profit used to guide day to day decisions
|
|
|
what are budgets based on?
|
historical figures and educated forecasts on sales and costs in a specific period
projected monthly, totaled yearly |
|
|
the amount allocated for labor is dependent on what factors?
|
menu items
level of expertise needed method, amount of prep needed type of service location special events, holidays |
|
|
for an operation to achieve budgeted profit, sales projections listed in the budget must be met, true or false?
|
true
costs must be held to standard, too |
|
|
an important part of management function is to make sure payroll cost is in line with . . .
|
budgeted standard
|
|
|
what is the first step in making sure labor cost meets standard?
|
creation of a work schedule
|
|
|
payroll controls and budget start with what?
|
a master schedule based on projected sales (which are based on historical sales)
|
|
|
how do you first start to create a work schedule?
|
analyze historical sales figures, which are then translated into sales projection. From there, figure dollars available for labor cost
|
|
|
what is historical sales info?
|
an account of past sales volume in foodservice industry
|
|
|
what are sales projections?
|
estimates of future sales based on historical sales records
past sales are used as a baseline |
|
|
after determining anticipated sales, management must determine payroll dollars, which are what?
|
the number of dollars available for payroll for a scheduling period
|
|
|
payroll dollars are calculated from anticipated labor costs, true or false?
|
true
|
|
|
how do you calculate total available labor dollars?
|
1) standard labor cost% X projected sales = dollars available for labor
2) Subtract cost of benefits, deductions = remaining payroll available dollars 3) subtract fixed labor = dollars available for variable cost employees |
|
|
what is a master schedule?
|
a template showing number of people needed in each position to run a restaurant
|
|
|
how can you determine the hourly staff needed?
|
by using productivity standards
|
|
|
what is the most efficient method of scheduling service staff?
|
with a labor productivity standard known as covers per server
|
|
|
what is covers per server?
|
the number of customer meals that a wait staff can serve in an hour
|
|
|
each operation should have a standard figure for covers per server based on past customer counts and productivity levels. this standard is measured against what?
|
sales forecast to determine number of servers to schedule
|
|
|
If the forecast is for 300 in a 4-hour period, and the standard cover per server is 20, how many servers should be scheduled?
|
300 divided by 4 = 75 covers per hour.
75 divided by 20 = 3.75 servers |
|
|
once servers are scheduled, the number of hours for the rest of the positions needs to be figured out, true or false?
|
true
|
|
|
payroll dollars available - fixed cost - server payroll dollars = what?
|
remaining payroll dollars available
|
|
|
How do you divide by average wage per hour?
|
remaining payroll dollars available divided by average wage per hour = number of hours available to schedule remaining hourly employees
|
|
|
once the master schedule is written, it needs to be what to see if it meets company standard?
|
validated
|
|
|
what's the formula for validation?
|
fixed payroll + variable payroll = total payroll
total payroll + FICA/Medicare/benefits = total forecasted labor cost |
|
|
how do you calculate forecasted labor cost percent?
|
total forecasted labor cost divided by forecasted sales = forecasted labor cost percent
|
|
|
the forecasted labor % figure should agree with what?
|
company standard
|
|
|
if labor forecast is lower than standard, do what?
|
add hours to the schedule
|
|
|
after master schedule has been written, validated and meets standard, it can be used to make what?
|
management and crew schedules
|
|
|
what is a crew schedule?
|
a chart that shows employees' names and days/time to work
|
|
|
what is the primary control for managing labor cost?
|
the schedule
|
|
|
what is the most difficult part of proper scheduling?
|
forecasting sales
|
|
|
what is another control in maintaining labor cost?
|
tracking time employees work
|
|
|
factors that affect labor cost directly include . . .
|
turnover
benefits labor contracts |
|
|
factors that affect labor cost indirectly include . . .
|
quality and productivity standards
|
|
|
what is employee turnover?
|
number of employees hired to fill one position in a year's time
|
|
|
how do you calculate employee turnover rate?
|
number of employees hired in a year, divided by average number needed, X 100 = turnover rate
|
|
|
what are some expenses associated with turnover?
|
lost management time through interviewing, training;
labor cost of one employee shadowing another; unproductive time during training; cost of seeking applicants; accounting costs |
|
|
where does the cost of hiring come out of?
|
profit
|
|
|
what are 3 methods for tracking time?
|
timesheet
timecard electronic check-in with password |
|
|
what are 2 prevalent indirect costs of employee turnover?
|
loss of productivity
customer dissatisfaction |
|
|
what is a quality standard?
|
a level of excellence used to measure customer satisfaction
|
|
|
what is a productivity standard?
|
level set by management to measure amount of work performed
|
|
|
some standards may include . . .
|
job description
menu production chart (quantity standards) standardized recipe |
|
|
what is a return chart?
|
explains why a customer returned an item to the kitchen
|
|
|
how is productivity measured?
|
sales per person-hour
covers per person-hour sales per cover |
|
|
what are person-hours, also known as labor hours?
|
total hours worked by hourly employees for a given period
Ex: 3 people X 5 hours = 15 person-hours |
|
|
sales per person-hour tells you what?
|
how productive the staff is
|
|
|
how do you calculate number of sales per person-hour?
|
sales divided by number of person-hours = sales per person-hour
Ex: $1,000 divided by 15 per person-hours = $66.67 sales per person-hour |
|
|
how do you calculate covers per person-hour?
|
covers divided by person-hour = covers per person-hour
Ex: 225 covers divided by 9 per-person hours = 25 covers per person-hour |
|
|
when analyzed together, sales per cover and covers per person-hour will tell who the best servers are in terms of productivity (table turnover) and sales ability (high average check), true or false?
|
true
|
|
|
what does sales per cover measure?
|
sales ability of a server
|
|
|
how do you calculate sales per cover?
|
total sales per server divided by covers sold by server = sales per cover
|
|
|
what is a control that management uses to keep labor costs in control?
|
budget
|
|
|
what is gross payroll?
|
amount of money spent in exchange for a person's work
|
|
|
factors directly affecting labor costs include . . .
|
time tracking,
sales levels, schedule modification, overtime, benefits offered, labor contracts, employee turnover |
