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Flashcards in Financial Management Deck (24)
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1

How to calculate current ratio

current assets/current liabilities

2

Define liquidity

an organizations ability to pay bills

3

define solvency

an organizations ability to meet long-term financial obligations

4

how to calculate solvency ratio

total assets/total liabilities

5

how to calculate debt to equity raito

total liabilities/total owner's equity

6

define activity

how effectively an organization uses assets

7

how to calculate food inventory turnover

cost of food sold/average food inventory

8

how to calculate average inventory

(beginning food inventory + end food inventory) / 2

9

define profitability

how effective management is generating sales, controlling expenses, and providing a profit

10

how to calculate profit margin

net profit/sales

11

how to calculate return on equity

net profit / equity

12

how to calculate return on assets

net profit / total assets

13

define operating

how successful is the org in generating revenue and controlling expenses

14

how to calculate average customer check

total sales / # guest served

15

how to calculate seat turnover

covers served / number of seats

16

how to calculate food cost percent

cost of food sold / food sales

17

how to calculate labor cost percent

cost of labor (including salaries, wages, and benefits) / total sales

18

how to calculate food cost per patient

food cost / number of patients served

19

how to calculate meals per labor hour

meals served / number of labor hours needed to produce the meals

20

how to calculate labor minutes per meal

minutes of labor needed to produce meals / number of meals served

21

how to calculate meals per FTE

meals served / number of FTEs to produce the meals

22

how to calculate selling price of a menu item using the food cost percentage method

item food cost x (100/percent income desired from food)

23

define item contribution margin

aka gross profit margin, about that remains after food cost of a menu item is subtracted from the selling price of that item

24

how to calculate selling price of a menu item using the item contribution margin

item food cost + desired item contribution margin