Recipe cost describes a standard portion
A recipe card converts current pack prices and usable yields into the ingredients required for one portion. If the standard is $3 per meal, it is a modeled input rather than a measurement of everything the kitchen consumed. Changed portions, supplier prices, or batch yields require an updated card.
Theoretical cost links recipes to sales mix
Suppose a fictional week sells 300 meals at $3 ingredient cost and 100 desserts at $1.20. Theoretical cost is 300 × $3 + 100 × $1.20 = $1,020. This represents recorded sales at standard portions. Document staff meals, samples, and other authorized usage separately so the comparison has an explicit boundary.
Actual cost comes from consistent inventory records
With opening inventory of $800, purchases of $700, and closing inventory of $400, actual consumption is $1,100 before any transfer or credit adjustments. Use the same cutoff for counts and invoices. Count stock with a consistent valuation method; switching between pack and individual-unit values can create a variance without any physical loss.
Compare both on the same sales basis
At $4,000 net food sales, theoretical food cost is 25.5% and actual is 27.5%, a gap of $80 or 2 percentage points. Neither percentage includes all labor or overhead. Investigate the gap rather than treating it as an automatic waste total: missing counts, stale recipe costs, and authorized non-sale use can explain part of it.
Use your own operating data
Supplier prices, yields, labor rates, and channel fees change. KitchenMargin treats them as editable inputs rather than universal facts.