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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.
For almost my entire restaurant career, I had been taught and have taught others that the key prime cost target is 60 â 65 percent for a full-service restaurant and 60 percent for a quick-service restaurant, and Iâve been able to help my membersâ consistently achieve 60 percent. But itâs no longer any good.