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Prime Cost = Raw Materials + Direct Labor. The prime cost of a single bed frame is ($6,500 + $750) / 10, or $72.50. In order to generate a profit, the company must sell each frame for more than $72.50.
To calculate the food cost percentage of an individual portion or menu item, you simply add up the cost of the ingredient(s) and divide that result by the menu price. Total Cost of Ingredients Ã· Menu Price = Food Cost Percentage.