Question

Sales			Transfers From Bar
			Beer	$150
Beer	$12,000		Wine	$1,100
Wine	$34,000		Spirits	$350
Spirits	$27,000
Employee Meals	$3,000
			Transfers to Bar	$880
Beginning Inventory			Ending Inventory
Beer	$5,000		Beer	$3,500
Wine	$50,000		Wine	$51,000
Spirits	$7,000		Spirits	$5,800
Purchases
Beer	$3,700
Wine	$12,000
Spirits	$11,500

Calculate the cost of goods sold and sales percentages for beer, wine, and spirits (show your work; partial credit will be awarded) Assume that all transfers to the bar are assigned to the “spirits” column:

Beer cost of goods sold:	Beer cost %:
Wine cost of goods sold:	Wine cost %:
Spirits cost of goods sold:	Spirits cost %:
Total beverage COGS:	Total beverage cost %:

If the company standard is for a beer cost of 25%, a wine cost of 35% and a spirits cost of 30% would you say that this manager is doing a good job? Why or why not?

Answer 1

Particulars	Beer	Wine	Spirits	Total
Opening stock	$5,000	$50,000	$7,000	$62,000
Add purchase	$3,700	$12,000	$11,500	$27,200
Add transfer frm bar	$150	$1,100	$350	$1,600
Less closing stock	$3,500	$51,000	$5,800	$60,300
Cost of goods sold	$5,350	12100	13050	$30,500
Gross profit % (COGS/sales)	45%	36%	47%	41%
Cost % (1- gross profit %)	55%	64%	53%	59%
sales (A)	$12,000	$34,000	$27,000	$73,000
Transfer to bar (B)	0	0	$880	$880
Total sales (A+B0	$12,000	$34,000	$27,880	$73,880
actual rate	55%	64%	53%
Company standard rate of cost	25%	35%	30%
Remarks	The actual rate of cost is more than the company standard therefore the manager is not doing a good job