HTM 2030 Lecture 8: 10.17 Chapter 8 Monthly Inventory and Monthly Food Costs

• School: University of Guelph
• Department: Hospitality and Tourism Management
• Course: HTM 2030
• Professor: William Murray

Document Summary

Chapter 8 monthly inventory and monthly food costs. 3 monitoring against standards (monitor performance and compare actual performance with established standards) Inventory and food cost: to monitor and access control procedures, first need to determine: Monthly food costs (%: thus, need to (in reverse order) Determine the physical inventory and its value. Five ways to assign value to units of inventory (methods of calculating closing inventory) 1 actual purchase price method: can be done only if the prices are physically marked on the units of inventory. 2 first-in, first-out method: assumes that the stock has been properly rotated during the period. Ordered oldest to newest, inventory on the shelf can be considered the newest. 3 weighted-average purchase price method: the value of one unit is determined by dividing all units into the total value of the inventory. 4 latest purchase price method: simply uses the latest purchase price.