Joe and Jim Are Planning to Open an Italian Restaurant

question 72

Multiple Choice

Joe and Jim are planning to open an Italian restaurant in a St. Louis suburb. When the two of them meet to decide what tasks need to be completed in order to meet their vision and then group like tasks into jobs, which of the following management functions are they undertaking?

• A) planning
• B) organizing
• C) influencing
• D) controlling
• E) assigning

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Definitions:

Contribution Margin

The difference between sales revenue and variable costs, used to cover fixed costs and profits.

Fixed Expenses

Expenses that remain constant regardless of the amount of output or sales within a brief timeframe, including lease payments, wages, and coverage fees.

Break-even Point

The level of production or sales at which total costs equal total revenue, meaning the company neither makes a profit nor incurs a loss.

Unit Contribution Margin

This is the difference between the selling price per unit and the variable cost per unit. It indicates how much each unit sold contributes to fixed costs and profit.