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WorksheetsChapter 2 Forecasting and Budgeting Key Terms
Total questions: 20
Worksheet time: 20mins
Break-even point
The profit amount that reflects only those line items over which a manager has any influence or control.
The minimum amount of sales an establishment must generate to cover all costs.
Profit resulting from specific investments made in an operation.
A markup method based on expenses being increased by a predetermined amount, normally a percentage of the previous year’s expense.
Budget
A budget that is based on several possible levels of sales activity, also known as a variable budget.
A budget that allows an establishment to plan for the replacement of high-cost equipment that wears out, and to purchase new types of equipment that may come on the market.
A budget from one year to five years in the future.
A plan that indicates an operation’s financial objectives or financial standards.
Budgeting process
The process of using historical information and knowledge of external factors to predict future sales.
A method that involves estimating expenses for a future period as a percentage of the sales forecast.
The way managers go about developing a budget, which is a process of both planning and control.
Making future predictions about the budget based on current situations and trends.
Capital expenditure budget
A budget that allows an establishment to plan for the replacement of high-cost equipment that wears out, and to purchase new types of equipment that may come on the market.
A budget that is based on several possible levels of sales activity, also known as a variable budget.
A budget from one year to five years in the future.
A formal one-year operating plan to achieve the financial goals of an organization.
Controllable profit
The difference between actual results (i.e., sales) and targeted or budgeted results.
The profit amount that reflects only those line items over which a manager has any influence or control.
A budget that is based on a certain level of sales revenue; expense estimates for food, labor, and other costs are then calculated based on that level of sales.
Profit resulting from specific investments made in an operation.
Cost of sales
Decrease in the weight of purchased meat because of cooking or trimming.
The minimum amount of sales an establishment must generate to cover all costs.
The cost of the food and beverage products to a given operation.
The percentage of an amount of a food item served to a guest.
Fixed budget
A budget from one year to five years in the future.
A budget that is based on a certain level of sales revenue; expense estimates for food, labor, and other costs are then calculated based on that level of sales.
A budget planned for a week, a month, or a quarter.
A budget that is based on several possible levels of sales activity, also known as a variable budget.
Flexible budget
A budget that is based on several possible levels of sales activity, also known as a variable budget.
A formal one-year operating plan to achieve the financial goals of an organization.
The process of using historical information and knowledge of external factors to predict future sales.
Making future predictions about the budget based on current situations and trends.
Forecasting
A formal one-year operating plan to achieve the financial goals of an organization.
Making future predictions about the budget based on current situations and trends.
A method that involves estimating expenses for a future period as a percentage of the sales forecast.
The process of using historical information and knowledge of external factors to predict future sales.
Income statement
The profit amount that reflects only those line items over which a manager has any influence or control.
A document that reports an operation’s sales, expenses, and profits or losses for a period of time, such as a month, a quarter, or a year.
A budget that is based on a certain level of sales revenue; expense estimates for food, labor, and other costs are then calculated based on that level of sales.
A budget planned for a week, a month, or a quarter.
Long-term budget
A budget from one year to five years in the future.
Making future predictions about the budget based on current situations and trends.
A budget that is based on several possible levels of sales activity, also known as a variable budget.
A formal one-year operating plan to achieve the financial goals of an organization.
Operating budget
A budget that is based on a certain level of sales revenue; expense estimates for food, labor, and other costs are then calculated based on that level of sales.
A budget planned for a week, a month, or a quarter.
A formal one-year operating plan to achieve the financial goals of an organization.
A budget that is based on several possible levels of sales activity, also known as a variable budget.
Percentage of sales method
A markup method based on expenses being increased by a predetermined amount, normally a percentage of the previous year’s expense.
The difference between actual results (i.e., sales) and targeted or budgeted results.
A document that reports an operation’s sales, expenses, and profits or losses for a period of time, such as a month, a quarter, or a year.
A method that involves estimating expenses for a future period as a percentage of the sales forecast.
Return on investment (ROI)
The percentage of an amount of a food item served to a guest.
Profit resulting from specific investments made in an operation.
Making future predictions about the budget based on current situations and trends.
Decrease in the weight of purchased meat because of cooking or trimming.
Sales forecast
The percentage of an amount of a food item served to a guest.
The process of using historical information and knowledge of external factors to predict future sales.
The minimum amount of sales an establishment must generate to cover all costs.
The cost of the food and beverage products to a given operation.
Short-term budget
A budget from one year to five years in the future.
A budget that is based on several possible levels of sales activity, also known as a variable budget.
A formal one-year operating plan to achieve the financial goals of an organization.
A budget planned for a week, a month, or a quarter.
Shrinkage
The way managers go about developing a budget, which is a process of both planning and control.
Decrease in the weight of purchased meat because of cooking or trimming.
The percentage of an amount of a food item served to a guest.
The difference between actual results (i.e., sales) and targeted or budgeted results.
Simple markup method
A markup method based on expenses being increased by a predetermined amount, normally a percentage of the previous year’s expense.
A formal one-year operating plan to achieve the financial goals of an organization.
A plan that indicates an operation’s financial objectives or financial standards.
A method that involves estimating expenses for a future period as a percentage of the sales forecast.
Utilization factor
The difference between actual results (i.e., sales) and targeted or budgeted results.
The percentage of an amount of a food item served to a guest.
Profit resulting from specific investments made in an operation.
Decrease in the weight of purchased meat because of cooking or trimming.
Variance
The minimum amount of sales an establishment must generate to cover all costs.
Making future predictions about the budget based on current situations and trends.
The difference between actual results (i.e., sales) and targeted or budgeted results.
The profit amount that reflects only those line items over which a manager has any influence or control.
