Gross profit formula
Sales-cost of goods sold
Meals/labor hour
Total meals served per day/ labor hours per day
Prime cost method formula
Raw food cost+ the direct labor cost of those employees involved in the preparation of the food item
Does not include costs of service, sanitation, or admin
Depreciation
(Cost of the asset- salvage unit)/ years of useful life
Net profit formula
Gross profit-expenses
Current ratio formula
Current assets/ Current liabilities
Inventory turnover formula
Cost of goods sold (food cost)/ average inventory value
Average food inventory formula
Beginning inventory+ End inventory for the month
Food cost
Beginning inventory for the month+ Purchases for the month= cost of food available- End inventory for the month= cost of food used
Food cost percentage
Cost of food/sales
Labor cost percentage
Cost of labor/sales
FTE per week
Total number of meals served/total number of FTE to produce meal
Break even point
Fixed cost/1- (Variable costs/sales)
Minutes/meal
(Labor minute/day)/ Total meals served/day
Factor pricing method
The prime cost (raw food cost+ direct labor cost) X pricing factor (Operating margin/100)= selling price
Actual cost method
Selling price= actual food cost+ actual labor cost+ Other variables costs+ fixed costs+ profit
Payroll costs/day
Hourly rate of each employee X hours worked by each employee
Meals/labor hour
Total meals served per day/ labor hour per day
Labor cost/meal served
Total labor cost per day/ Meals served per day
Payroll cost per meal served
(Total daily payroll cost)/ Meals served per day
Labor budget
The budget allowed for labor total work hours in year X FTE’sX avg pay
Full time equivalents
Number of total hours worked/40
Edible portion weight
EP= AP weightX percent yield
Edible portion cost
EP cost= AP cost/% yield
