Do all 6 problems on pages 104 & 105, use the blank engineering worksheet for problem 6. 104 Chapter 3ProblemsProblem 1The total ingredient (food) cost in a recipe is $4.73; the manager desires a 37.5-percent foodcost. What is the base selling price of the item using the ingredients mark-up methodShould the manager price the item in the above example at the base selling price youcalculated? Why or why not?Problem 2The chef has precosted the recipe for an entrée and a sauce, which is one item on the menu,the food cost is $6.34. A prime ingredient multiplier of 3.72 has been established. What is thebase selling price when the prime ingredient mark-up method is used?Problem 3The Prairie Town Grill does not serve alcoholic beverages. Its operating budget reveals thefollowing:RevenueFood costNon-food costsProfitNumber of guestsGuest check averageContribution margin$1,375,000$585,000$710,000$80,000161,580$8.51$790,000 (revenue - food costs)Using the above information, calculate the base selling price of a menu item with a totalingredient cost of $4.85 using:a. The contribution margin pricing method.b. The ratio pricing method.c. The simple prime costs method (note: the non-food costs include $426,250 in laborcosts).Problem 4The manager uses the mark-up with accompaniment cost method to establish a base sellingprice. What is that price when the entrée cost is $2.12, the plate cost is $1.70, and the mark-upmultiplier is 2.1?Problem 5The manager of the University Square Bistro has the following operating data available:RevenueFood costLabor costOther non-food costsDesired profitNumber of guests$1,187,000$403,580 (includes entrée costs of $274,434)$367,970$316,550 (excludes labor)$98,900107,900The Menu: The Foundation for Control 105Use the above information to establish the base selling price of a menu item with alternativepricing methods. Note: the item to be priced has a food cost of $4.57 (entrée cost = $3.12;plate cost $1.45)a. What is the approximate base selling price using the ingredients mark-up method?b. What is the approximate base selling price using the prime ingredient mark-upmethod?What is the approximate base selling price using the mark-up with accompanimentcosts method?d. What is the approximate base selling price using the contribution margin pricingmethod?e. What is the approximate base price using the ratio pricing method?f. What is the approximate base selling price using the simple prime costs method?Problem 6Complete the menu engineering worksheet on the following page. Suggest strategies toeffectively manage each item after the worksheet is completed. Problem 6 WorksheetRestaurant: Terry's Overland GrillABCD(A)Menu Item NameColumn Totals:(B)NumberSold(MM)481190205340NMenuMix%(D)ItemFoodCost4.906.505.207.00Additional Computations:(E)ItemSellingPrice12.5014.7510.6016.80Menu Engineering Worksheet(F)ItemCM(G)MenuCosts1(H)MenuRevenuesJ(L)MenuCMMDate:Meal Period:2-M/N7/10/XX(P)CMCategoryDinner(R)MM%Category(S)Menu ItemClassificationQ- (100%/items) (70 %)

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