How do you calculate the labor cost per meal given total sales and labor expenses?

To calculate the labor cost per meal, you divide the total labor expenses by the total number of meals served. This quotient provides the average cost of labor associated with preparing each meal.

For example, if the total labor expenses amount to $4,050 and the total sales or meals served number 2,000, the calculation would be:

Labor cost per meal = Total Labor Expenses / Total Meals Served

Labor cost per meal = $4,050 / 2,000

Labor cost per meal = $2.03

This calculation shows that the labor cost associated with each meal is $2.03. Therefore, this value reflects efficient utilization of the labor resources in relation to the meals served, which is essential for budgeting and cost control in food service operations.

This understanding emphasizes the importance of operational efficiency and cost management within the food service industry, as labor is one of the largest expenditures affecting overall profitability.