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8. BONUS Sissy LaRoussa has studied both the food cost percentage and contribution margin matrix methods of menu analysis and believes that they rely too

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8. BONUS Sissy LaRoussa has studied both the food cost percentage and contribution margin matrix methods of menu analysis and believes that they rely too heavily on the cost of food for their conclusions. Sissy operates a "Quick Wok" outlet in her local mall's food court. She serves hot and lasty Asian cuisine to the mall shoppers. In her operation, both labor costs and occupation costs (her lease) exceed food costs on her monthly income statement. From that income statement, she knows that her non-food variable cost (primarily her labor cost as well as a percentage sales fee assessed by the mall's owners) averages 35% of her menu selling price. She wants to use goal value analysis to determine which, if any, of her menu items are failing to perform well for her. Utilizing last week's sales data presented in the following chart, calculate the goal value for each item. Then, sort (in descending rank order) by goal value. Be sure to include the Overall Menu Goals in the appropriate rank order Sissy's Quick Wok Item Food Cost % Number Sold Selling Price Variable Cost % Goal Value Beef and broccoli 0.25 773 1.99 0.35 Sweet and sour pork 0.18 321 3.99 0.35 General Tao's chicken 0.20 4.99 0.35 Vegetable stir-fry 0.11 1.19 0.35 Three-item combo 0.41 310 6.99 0.35 Coconut shrimp 0.24 185 5.99 0.35 Asian ribs 0.80 145 6.99 0.35 Ourall Menu Goals 0.25 445 5.50 610 10 0.35 a. Using this type of analysis, which item would be considered Sissy's most profitable item? b. What is the primary cause of that item's high goal value? c. Using this type of analysis, which item would be considered Sissy's least profitable item? d. What is the primary cause of that item's lower goal value? e. Based on the results of the goal value analysis, identify specific actions you would recommend Sissy take to improve the profitability of her menu items that do not meet her goals. (Spreadsheet hinc. In order for the table to sort correctly, you must put the ENTIRE goal value formula in cach cell of the Goal Value column.)

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