U Center Food Cost Profit Status

7/30/2019 U Center Food Cost Profit Status

1/33

Calculating Food CostPercentages and Profit Status

for CCFP Unaffiliated Centers


2/33

How to Calculate the Food Cost Percentage:

1. Verify the centers food costs. Review the OperatingExpenditures Worksheet(s) and receipts to verify the amountof allowable food costs.

2. Determine the centers total meal earnings. This is theamount of CCFP reimbursement (for meals + cash-in-lieu)earned by the center before the sponsors administrative fee

is deducted or other adjustments are made.

3. Divide the amount of verified food costs by the amount oftotal meal earnings to determine the percentage of earnings

being spent on food.Verified food costs

Total meal earnings

= Percent (%) spent on food


3/33

How to Calculate Profit Status:

1. Verify the centers expenditures. Review expenditureworksheets, receipts, and PAR forms to determine the totalamount of allowable costs the center can claim. Thisincludes operating costs (food and non-food) and

administrative costs (if any) incurred by the center. (It isunusual for an unaffiliated center to have/claimadministrative costs.)

2. Determine the amount of the centers net reimbursementafter the sponsors administrative fee has been deducted.

3. Divide the amount of allowable expenditures by the netreimbursement amount to determine the percentage of

reimbursement being spent on the program. A result of lessthan 1.00 means the center is in profit status. A resultgreater than 1.00 means the center is spending more on theprogram than it is earning.

Allowable center expenditures Net reimbursement= Percent (%) spent on CCFP


4/33

Exercise # 1

Compare an Independent Center to aSponsored Unaffiliated (U) Center.

Notice the differences and similarities inhow to perform food cost and profit statuscalculations for each type of center.


5/33

Use the data in the upper part of the table to answer thequestions below.

IndependentCenter

U Center

Total meal earnings (including cash-in-lieu) $2,000 $2,000

Food purchases $1,000 $850

Non-food operating expenses $400 $850

Centers administrative expenses $400 $0

Amount retained by sponsor for administrative expenses N/A $300

1. How much reimbursement did the center receive for this

month?

2. What percentage of total meal earnings was spent on

food? Is the percentage okay or not?


program administration? Is the percentage okay or not?

4. How much did the center spend on the program for this

month?

5. Is the center in a profit status for this month? If yes, whatpercentage of reimbursement was spent on the program?


6/33


IndependentCenter

U Center







month? $2,000 $1,700






month?



7/33


IndependentCenter

U Center







month? $2,000 $1,700



50%

YES

42.5%

NO




month?



8/33


IndependentCenter

U Center







month? $2,000 $1,700



50%

YES

42.5%

NO



20%

YES

15%

YES


month?



9/33


IndependentCenter

U Center







month? $2,000 $1,700



50%

YES

42.5%

NO



20%

YES

15%

YES


month?$1,800 $1,700



10/33


IndependentCenter

U Center







month? $2,000 $1,700



50%

YES

42.5%

NO



20%

YES

15%

YES


month?$1,800 $1,700


YES

90% NO


11/33

Exercise # 2

Calculate Center As food cost

percentages for:1. December 2008

2. First quarter of FY 2009 (10/08 12/08)

Assume that all amounts on the followingreport have been verified by supportingdocumentation.


12/33

First, lets look at December 2008.


13/33

$2,282.22 = Food Costs for December 2008


14/33

$4,466.09 + $788.75 = $5,254.84Total Reimbursement for December 2008


15/33

$2,282.22 / $5,254.84 = 43% Spent on Food in December 2008


16/33

Next, lets look at First Quarter FY 2009.


17/33

$7,715.67 = Food Costs for First Quarter FY 2009


18/33

$12,735.07 + $2,247.35 = $14,982.42Total Reimbursement for First Quarter FY 2009


19/33

$7,715.67 / $14,982.42 = 51% Spent on Food in First Quarter FY 2009


20/33

Exercise # 3

Calculate Center Bs profit status for:

1. December 20082. First quarter of FY 2009 (10/08

12/08)

Assume that all amounts on the following

report have been verified by supportingdocumentation.


21/33

Lets look at December 2008.


22/33

$279.26 + $435.00 + $3.72 = $717.98Total Expenditures for December 2008


23/33

$843.35 = Center Earnings for December 2008


24/33

$717.98 / $843.35 = 85% of Reimbursement Spent for December 2008


25/33

Now well look at First Quarter FY 2009.


26/33

$541.17 + $957.00 + $16.72 = $1,514.89 TotalExpenditures for First Quarter FY 2009


27/33

$1,398.50 = Center Earnings for First Quarter FY 2009


28/33

$1,514.89 / $1,398.50 = 108% of ReimbursementSpent for First Quarter FY 2009


29/33

Based on this report, what is a quick way to see if the center is inprofit status for any month or for the quarter?


30/33

The last Total column shows the difference between what the center

spent and what it earned. A negative amount indicates that the centerspent more than it earned. A positive amount indicates that the center didnot spend all of its earnings, thus it is in profit status.


31/33

Based on this report, what is a quick way to calculate the profi tstatus percentage for December 2008?


32/33

Divide the amount in the last Total column by the amount in the Earnings column. For example: $125.37 / $843.35 = 15% profit status for

December 2008. This confirms our earl ier calculation, which showed thatthe center only spent 85% of its earnings for December 2008, thus under-spending by 15%.


33/33

U Center Food Cost Profit Status

Documents

Transcript of U Center Food Cost Profit Status