Patriot_sPizza
New member
as an Auditor in a previous life, there are many regional variations in accounting language
Food Costs s/b based on a “true” cost basis, not what was purchased that month or time period. You need to have a beg. inv #, a purchase #, and an ending inv # - that is a “true” cost - that # s/b compared to what is actually “bankable” and not compared w/promo or discount #'s - those s/b tracked but do not come into play here…personally I do not track paper or box costs here
Labor costs might include p/r exp or just raw labor. It is best to break out some categories, like driver’s wages, mgmt wages, etc, to give you a clearer picture. I track p/r taxes, bene and the like as a separate line item/category…
Controllable costs s/include paper/box costs, items you purchase to support your sales…
Then I would key in my “variable” costs, such as utilities and items associated to keeping the business open
Fixed costs might be viewed different for different operations…some are “buying” their real estate while others are renting - these #'s will be different for those different operators…those buying will have depreciation expenses that may be greater than the actual cost of doing business (IRS stuff) while those renters show actual expenses…
Bottom line is cash flow…you can show greater costs when you are buying the R.E., but your cash flow will be greater than your bottom line profit you report…
You should “shoot” for 60-65% combined costs, as a general rule of thumb - how you get there is your choice…
Some choose to make many items from scratch, thus lowering (theoretically) their food cost, but increasing their labor costs…(think making your dough vrs buying frozen)
Others may choose to do “buy-outs” and experience higher food costs but lower labor costs…(think buying rolls/cheesecake etc)
Hopefully I’ve not bored 2 many…
Semper Fi, USMC
Area Auditor, Inspector General Branch
Food Costs s/b based on a “true” cost basis, not what was purchased that month or time period. You need to have a beg. inv #, a purchase #, and an ending inv # - that is a “true” cost - that # s/b compared to what is actually “bankable” and not compared w/promo or discount #'s - those s/b tracked but do not come into play here…personally I do not track paper or box costs here
Labor costs might include p/r exp or just raw labor. It is best to break out some categories, like driver’s wages, mgmt wages, etc, to give you a clearer picture. I track p/r taxes, bene and the like as a separate line item/category…
Controllable costs s/include paper/box costs, items you purchase to support your sales…
Then I would key in my “variable” costs, such as utilities and items associated to keeping the business open
Fixed costs might be viewed different for different operations…some are “buying” their real estate while others are renting - these #'s will be different for those different operators…those buying will have depreciation expenses that may be greater than the actual cost of doing business (IRS stuff) while those renters show actual expenses…
Bottom line is cash flow…you can show greater costs when you are buying the R.E., but your cash flow will be greater than your bottom line profit you report…
You should “shoot” for 60-65% combined costs, as a general rule of thumb - how you get there is your choice…
Some choose to make many items from scratch, thus lowering (theoretically) their food cost, but increasing their labor costs…(think making your dough vrs buying frozen)
Others may choose to do “buy-outs” and experience higher food costs but lower labor costs…(think buying rolls/cheesecake etc)
Hopefully I’ve not bored 2 many…
Semper Fi, USMC
Area Auditor, Inspector General Branch
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