Example : You could decide to focus on

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This decision can reduce the cost of goods while maintaining or even improving the quality of the dishes. However, seasonal adjustments to the menu are necessary. Calculating Cost of Goods: Step-by-Step Guide 1. Determine the opening inventory The opening inventory is the value of all the food and beverage stocks you have in your warehouse at the beginning of a certain period. This value can be determined by taking an inventory. Formula: Quantity of goods x argentina phone data cost price = value of goods The cost price is the price you paid to purchase the goods, including all additional costs such as transport and storage. 2. Add purchases during the period Add up the total value of all food and drink purchases you made during the period in question. Make sure to use the cost price. Formula: Quantity of goods x cost price = value of goods 3. Determine the final inventory The ending inventory is the value of all remaining stocks of food and beverages at the end of the period under consideration. This is also determined by an inventory.

Formula: Quantity of goods x cost price = value of goods 4. Calculate cost of goods sold Now you can calculate the cost of goods sold. Use the following formula: Initial inventory + goods receipt (purchase) − price reduction (rebate, cash discount, etc.) − Final inventory = quantity of goods used example calculation Suppose you want to calculate the cost of goods sold for the month of May: Initial inventory (May 1): Food: 3,000 euros Drinks: 1,000 euros Total : 4,000 euros Shopping in May: Food: 8,000 euros Drinks: 3,000 euros Discounts, cash discount: 1,000 euros Total : 10,000 euros Final balance (May 31): Food: 2,500 euros Drinks: 1,500 euros Total : 4,000 euros Now we calculate the cost of goods sold: 4,000 euros (opening inventory) + 10,000 euros (purchases) − 4,000 euros (closing inventory) = 10,000 euros tips Regular inventory: Conduct regular inventory counts to obtain accurate inventory values. This is crucial for accurately calculating cost of goods sold. Documentation: Keep all invoices, delivery notes and inventory data well organized and accessible. Proper documentation makes it easier to calculate and track expenses. 5. Calculate the cost of goods sold ratio At first glance, a high or low cost of goods doesn't reveal much about the profitability of your restaurant.