NEED to know HOW to solve for the blanks. NEED questions: \"What issue can you i

Question

NEED to know HOW to solve for the blanks.

NEED questions:
"What issue can you identify when using this method for pricing individual items such as drinks and fries?"

and
"Compare the differences in menu prices you calculated using different methods. If you were Bess and David, which method would you choose? Why?"

Show HOW, EXPLAIN, & ANSWER.

Calculate the appropriate factor to be used to price menu items based on the desired 3 product cost percentages given 4 Pricing Factor Table 6 Desired Product Cost Factor 21 % 24% 32% 37% 41% 10 12 Bess and David have decided to use the factor method to determine how to price the items the menu for the diner they own together. Based on their desired product cost percentage 13 (food cost percentage), determine the proper selling prices for Bess and 14 15 Factor Method Desired Food Cost Percentage 38% 17 Item 18 Chicken Breast Dinner 19 Seafood Platter 20 Steak Dinner 21 Turkey Sandwich 22 Pork Chop 23 Hamburger 24 Cheeseburger 25 Fries 26 Meat Loaf 27 Small Dink Food Cost Factor $2 25 $3.45 54.99 $1.2 $2.45 $1.50 $1.7 $0.45 $1 After calculating menu prices based on the factor method Bess and David decide try calculating menu prices using other methods for comparison. Based on the following

Explanation / Answer

1. Pricing factor :

Factor : 1/desired product cost.

2.Selling price calculation :

Food cost * pricing factor= Selling price of the meterials.

Factor- 1/38%=2.63

This Pricing method is called markup pricing method.

3.

Contribution margin:

Contribution margin= (Nonfood cost+ Desired profit)/No. of customers

Contribution margin= ($38500+$12895)/9200=5.59

Selling price= Factor Cost * Contribution

For fries and drinks it isvery difficult to sale as it is small item to buy low cost.

4. Ratio mathod:

Ratio= (Non food cost +Profit)/ Total Food Cost

Non-Food Cost and profit needed= Food cost * Ratio

Selling price or menu price= Food cost +Non-Food cost and profit needed

Total food cost= $31500

Non food cost + profit= $51395

Ratio=51395/31500=1.63

this is almost same as markup pricing.

5.

Prime factor= 1/Prime cost

Selling price= (Prime cost + desired cost)/Factor

I think Ratio pricing is best pricing here

21% 4.76 24% 4.16 32% 3.13 37% 2.70 41% 2.44

Related Questions

Navigate

• Browse (All)
• Browse N
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.