What is the formula used to determine food cost?

Answer 1

Food Cost refers to two concepts and has two basic formulas:1) Plate Cost= total cost of a menu item / sales price

This is the cost of a menu item including all the ingredients served with the dish divided by the sales price before tax. This is a theoretical food cost used to forecast your budget and determine what price to sell items at.

2) Period End Food Cost = (beginning food inventory + food purchases - food credits - ending food inventory) / sales price

This is the actual food cost for the restaurant for any given period of time (monthly, weekly, etc.) This is an actual food cost which will include "hidden" costs such as waste, theft, over-portioning and a host of other issues which can affect a restaurant's food cost.

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