Food Service Financial Systems Final

Accounting Equation

Assets = Liabilities + Owners Equity

Accounts Payable

Money that you owe to your suppliers and other businesses

Asset

Something that has value in monetary terms

Bank Note

A bank loan also notes payable

Installment Loan

A bank loan or other loan on which you make scheduled payments

Liabilities

Money or debts owed to others, businesses, or creditors

Liquidity

The ease at which something can be turned into cash

Prepaid Expenses

Payment of a bill or policy made in advance but has not received the benefits

Retained Earnings

Profit that accumulates over the business's life but has not been used

Fixed cost

Expenses that do not change with the level of production or sales volume. (can change but not because of sales)

Variable cost

Expenses that fluctuate based on production or sales volume.

prime costs

Food,Bev, and Labor costs (cost of goods sold, salaries,wages,benefits)

payroll cost

salary + wages

labor Cost

Salaries+wages+benefits

cost of goods consumed

begining inventory+purchases=total available for sale -closing inventory

cost of sales

cost of goods consumed + cooking liquor -gratis to bar-food to bar-promotions-steward sales-employee meals

balance sheet

a financial snapshot of a business at a specific point in time. It provides a detailed view of a company's assets, liabilities, and owner's equity

income statement

often called the profit and loss statement, is a fundamental financial document that provides a snapshot of a business's financial performance over a specific period. It outlines revenues, expenses incurred, and the net income or loss achieved.

cash flow statement

reveals the actual cash flow generated and expended. It is a critical economic tool that tracks the inflow and outflow of cash, providing invaluable insights into a business's liquidity and overall financial health.

financial variance

is the difference between budgeted(expected) and actual financial performance. It highlights discrepancies in revenue and expenses,

horizontal income statement

B-A=C or amount C/A=D or percentage.

common size comparative income statement

compares 2 income statements ex 2024 and 2025 columns complete the two separate income statements as normal.

operating budget

predicting sales for the next period based on previous period and estimated changes ex predicting 3% drop in total sales previous sale amount X 0.97 because 100%-3=97%