A: Credit Memo is a memorandum filled by the catering establishment and handed over to the supplier for the short of supply of raw materials, either quality or quantity. The value of the short of supply is credited to the buyers account.
Q: Marking and Tagging
A: Marking and tagging is an index card, which carries the invoice information of the raw material. This card is attached to the raw material. Marking and Tagging makes it easier to judge whether stock rotation plans are effective. Also when valuing inventory, cost data can be taken directly from the index card; this saves the time. Tagging is often used with meats and seafood and is done when the products are received at the receiving area.
Q: Blind receiving
A: This is a measure to control pilferage in the receiving area. In this method the supplier is asked to put the bill directly to the accounts department instead of giving it to the receiving area. So the receiving clerk has to count, weight and measure all the raw material he receives and enter it correctly in the Daily Receiving Report (DRR).
Q: Product rotation
A: Product rotation is the turnover of raw material in the storage. Product rotation indicates movement of raw material from the storage to the production area and converted to revenue, accordingly new raw materials are replenished in the store.
Q: Perpetual Inventory System:
A: Perpetual Inventory System is an inventory control tool. ICMA London has defined this system as “ a system of record maintained by controlling department, which reflects the physical movement of stock and their current balances”. It is a method of recording stores balances after each receipt and issue to facilitate regular checking and to obviate closing down of work for stock taking.
Q: Perpetual inventory card
A: Perpetual inventory card is an index card. In the perpetual inventory system a record is maintained on a perpetual inventory card for each item regarding the purchases, the requisitions and the remaining balance. By using this card the current status of stock in hand is known.
Q: Inventory Turnover
A: The Inventory Turnover Rate shows the number of times in a given period that inventory is converted or turned into revenue. In financial terms, it measures the rate at which inventory is turned into food or beverage costs required to generate food or beverage income.
Q: Non-Productive inventory
A: Non-Productive Inventory refers to products in storage that are not issued to production areas during the accounting period (usually monthly). In order to determine how much money is tied up in non-productive inventory, managers measure the inventory turnover rate.
(Note: This blog is to provide some inputs to the students of hotel management. Additional referrence is suggested for the complete and indepth understanding of the subject.)
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