Question

1. What is a manager’s other expense percentage for utilities if sales were $75,000 in a month and utility costs for the month were $6,000?

2. What is a manager’s other expense Cost Per Guest for marketing, if sales were $90,000 in a month, 3,000 guests were served, and marketing costs for the month were $1,500?

3. A manager pays $300 per month for landscape services for his restaurant grounds. Which type of monthly other expense is the amount paid for landscaping?

4. A manager must pay a $500 annual fee to the state in order to serve alcohol in her bar. Which type of other expense is the amount paid for the license?

5. What is the formula managers use to calculate their Other Expense Cost Per Guest?

Answer 1

1, Manager's other expense percentage = Utility cost/ sales = 6000 / 75000 = 8%

2. Cost of marketing per guest = Marketing cost / Number of guests = 1500 / 3000 =$0.50

3. It is a maintenance cost. Controllable fixed cost. Fixed cost is $300 and the manager can control if by not opting for it, however, the restaurant may look bad if he does not opt for it.

4. Non-Controllable fixed cost. To serve alcohol manager has to be $500 annual fee and has no other option.

5. Other expense / Number of guests = Other expense cost per guest