TH1702

Laboratory Exercise
Cost Management
Objectives:

At the end of the exercise, the students should be able to:

 Apply ingredient conversion; and

 Calculate yields and food costs.

Materials:

• Pen
• Paper
• Calculator
• 03 Laboratory Worksheet 1.pdf

Basic Principles:

The Written Recipe

A recipe is a set of instructions for producing a certain dish. In order to duplicate a desired preparation, it is
necessary to have a precise record of the ingredients and its amounts and the way in which these are combined
and cooked. It is a way of applying basic techniques to specific ingredients.
The main purpose of learning basic cooking principles is not to be able to cook without recipes, however, but to
understand the recipes being used.
A standardized recipe is a set of instructions describing the way a particular establishment prepares a
particular dish. It is a customized recipe developed by an operation for the use of its own cooks, using its own
equipment, and to be served to its own customers (see sample standardized recipe card on Table 3.1).
Structure of a Standardized Recipe (Samson, 2007):
• Recipe file number. A filing number assigned to each recipe card for easier organization, storage, and
retrieval.
• Recipe name. A descriptive name for the recipe.
• Product classification. Describes under which category the recipe belongs to (i.e., soup, stock,
poultry, beef, etc.)
• Yield. The total amount of the end product or a number of portions produced by the recipe.
• Portion size. Description of the amount of product found in one (1) serving.
• Cooking time and temperature. Describes how long and at what temperature the product is to be
prepared. This is very important especially in baked and roasted products.
• Ingredients. A list of the required raw materials for the recipe.
• Measure. An accurate description of how much ingredient is to be used and its measuring unit.
• Procedures and methods. Describes the steps to be undertaken to produce a satisfactory product.
• Date revised. Indicates the date that the recipe was last reviewed and changed.

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Structure of a Standardized Recipe

• Quality control. Standardized recipes are detailed and specific. This is to ensure that the product is
the same every time it is made and served, no matter who cooks it.
• Quantity control. First, standardized recipes indicate precise quantities for every ingredient and how
these are to be measured. Second, it indicate exact yields and portion sizes, and how the portions are
to be measured and served.

Standardized Recipe Card

Recipe file no. : 1030
Recipe name : French Onion Soup
Product classification : Bouillon Soup
Date revised : November 21, 2017
Recipe yield : 1.25 Liters
Portion size : 5 servings (250 ml each)
Cooking time : 40 minutes
Cooking temperature : 185°- 200°F or 85°- 93°C (Simmering)
Ingredients Quantity Methods
Oil 10 g Heat in pan.
Butter 30 g Add and melt.
White onions, peeled,
400 g Add and cook until golden brown.
and sliced thinly
Dry white wine 150 ml Add and reduce.
Beef broth (prepared) 1L Fill in and simmer for 30 minutes.
Salt and pepper 20 g Season.
Croutons 125 g Garnish on onion soup in a cup.
Grate and garnish on onion soup in cup and place in salamander
Cheese 100 g
and brown slightly.
Table 3.1 Sample Standardized Recipe Card

Measurements
Most restaurants budget a net profit of 10 percent or less. This means a sandwich selling for P79.00 makes a
profit of only P7.90. If the cook happens to put half-ounce too much meat in the sandwich, the operation may
be losing money on it. Hence, careful measurement is important for consistent quality each time a recipe is
prepared and served to control costs.
Ingredient Measurement
Weight
Weighing measures how heavy an item is. Weighing is the most accurate method of measuring ingredients. It
is the method used for most solid ingredients. Accurate scales are necessary for weighing. Small portion scales
are often used in the kitchen because of their convenience.
To be able to weigh ingredients, one (1) must observe the difference between As Purchased (AP) and Edible
Portion (EP) weights.
• AP Weight. This is the weight of the item as purchased before any trimming or cooking is done. It is
also known as APQ (As Purchased Quantity).
• EP Weight. This is the weight after all inedible or “non-servable” parts are trimmed off. It is also known
as EPQ (Edible Portion Quantity).

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Recipes sometimes specify which weight it is referring to. When it doesn’t, one (1) must judge from the
instructions. See examples below:
 If a recipe calls for “2 lbs potatoes” and the first instruction is “scrub, peel, and eye the potatoes,” then
AP weight is called for.
 If the recipe calls for “2 lbs peeled, diced potatoes,” then EP weight is called for. This means that more
than 2 lbs AP is needed.
Volume
Volume measures how much space an item fills. Volume measures are used for liquids. Measuring a liquid by
volume is usually faster than weighing it, and accuracy is good. Solid ingredients are usually not measured by
volume because these cannot usually be measured accurately by this method.
However, very small quantities such as ¼ teaspoon salt may be measured by volume when the amount is too
small to weigh.
Count
Measuring ingredients by count is done in the following circumstances:
 When units are in fairly standard sizes. Examples: six (6) large eggs for a pancake batter; eight (8)
parsley stems for a stock.
 When serving portions are determined by number of units. Examples: one (1) baked apple per portion;
six (6) fried shrimp per portion.
Portion Control
This is the measurement of portions to ensure that the correct amount of an item is served. In order for portion
control to be carried out, cooks and service personnel must be aware of proper portion sizes. Portion control
actually begins with the measurement of ingredients. If this is not done correctly, then the yield of the recipe will
be thrown off/inconsistent.
Portion Control in Plating and Service
The following tools and techniques are used:
• Count. Examples: one (1) slice of ham per order; five (5) shrimps per order. This is accurate if cutting
and other prep work have been done correctly.
• Weight. Example: four (4) ounces of sliced ham per order. A portion scale must be at the serving station
for this method of portion control.
• Volume. Ladles, scoops, and kitchen spoons come in standard volume sizes and are used for
portioning. The exact size of the ladle or scoop needed for a portion must be determined in advance
and indicated on service instructions.
• Even division. Examples: cut a pie into eight (8) equal wedges; cut a 4 x 6 lasagne to make 24 equal
portions.
• Standard fill. Standard-sized dishes, cups, or glasses are filled to a given level, as judged by eye.
Example: a glass of orange juice. This is actually a form of volume measure, too.
Units of Measure
In the metric system, there is one (1) basic unit for each type of measurement.
Basic Units
• Gram (g) is the basic unit of weight.
• Liter (L) is the basic unit of volume.
• Meter (m) is the basic unit of length.
• Degree Celsius (°C) is the basic unit of temperature.

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Larger or smaller units are made simply by multiplying or dividing by 10, 100, 1000, and so on. These divisions
are expressed by prefixes such as these: kilo = 1,000; deci = 1/10; centi = 1/100; milli = 1/1,000.
Common Conversions
Weight
1 ounce = 28.35 grams (g)
1 gram = 0.035 ounce (oz.)
1 pound = 454 grams
1 kilogram = 2.2 pounds (lbs.)
Volume
1 fluid ounce = 29.57 milliliters (ml)
1 milliliter = 0.034 ounce
1 cup = 237 milliliters
1 quart (qt.) = 946 milliliters
1 Liter (L) = 33.8 fluid ounces (fl. oz.)
Solid
1 pinch = 18 teaspoon (approx.)
1 cup = 16 Tablespoons (T)
1 Tablespoon = 3 teaspoons (t)
1 Tablespoon = 15 milliliters = 15 grams
1 teaspoon = 5 milliliters = 5 grams
Gallon
Length
1 inch = 25.4 millimeters (mm)
1 centimeter (cm) = 0.39 inches
1 meter (m) = 39.4 inches
Temperature
To convert Fahrenheit to Celsius:
Subtract 32. Then, multiply by 59
To convert Celsius to Fahrenheit:
Multiply by 95. Then, add 32.
Liquid
0.946 quart = 1 Liter
1 pint (Pt.) = 2 cups
1 pint = 480 milliliters
1 cup = 240 milliliters

Converting Recipes
Each recipe is designed to make a specific amount of finished product. This amount is called the yield. For
example, one may have a recipe for 50 portions of Swiss steak but needs only 25 portions. In this case, one
needs to change the yield of the recipe. This is called converting the recipe.
Yields
Recipe yields are expressed in several ways. Below are the examples:
• As a total quantity. (A soup recipe that makes three (3) quarts; a pot roast recipe that makes five (5)
pounds meat.)
• As a total number of portions. (A recipe for Eggs Benedict that makes 12 portions.)
• As a total number of portions of a specified size. (A recipe for beef stew that makes eight 6-oz portions;
a recipe for individual chocolate soufflés that makes six 4-oz soufflés.)
Most recipe conversions require changing the total quantity or the total number of portions. The math for doing
both of these is the same. As long as the portion size stays the same, one can use either the total quantity or
the total number of portions as the yield when making calculations.
Conversion Factors
The conversion factor is the number used to increase or decrease each ingredient when converting a recipe
to a different yield. The first step in converting a recipe is to calculate the conversion factor. Use this formula to
get the factor.

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New yield ÷ Old yield = Conversion factor

Examples:
• A recipe with a yield of eight (8) portions, and you want to make 18 portions.
New yield ÷ Old yield = Conversion factor
18 ÷ 8 = 2.25
• A recipe with a yield of 20 liters of soup, and you want to make only 5 liters of it.
New yield ÷ Old yield = Conversion factor
5 ÷ 20 = 0.25
Procedure for Converting Total Yield
1. Calculate the conversion factor as explained in the procedure above.
2. Convert selected, if not all, ingredients to common units of measure when needed.
3. Multiply each ingredient quantity by the conversion factor.
Old quantity x Conversion factor = New quantity
Examples:
• A recipe for 10 portions of Broccoli Mornay requiring 3 lb AP broccoli and 2 ½ cups Mornay Sauce.
Convert to 15 portions.
1. New yield ÷ Old yield = Conversion factor
15 ÷ 10 = 1.5
2. Broccoli: 3 lbs. = 48 oz. 3 lbs. x 1.5 (conversion factor) = 4.5 lbs.
OR 48 oz. x 1.5 (conversion factor) = 72 oz.
Sauce: 2 ½ cups = 20 fl. oz. 2 ½ cups x 1.5 (conversion factor) = 3 ¾ cups
OR 20 fl. oz. x 1.5 (conversion factor) = 30 fl. oz.
• A recipe for 10 portions of Broccoli Mornay requiring 1,500 grams AP broccoli and 600 ml Mornay
Sauce. Convert to 15 portions.
1. New yield ÷ Old yield = conversion factor
15 ÷ 10 = 1.5
2. Broccoli: 1,500 g x 1.5 = 2,250 g
Sauce: 600 mL x 1.5 = 900 mL
• Convert the given recipe below into 18 portions.
Beef Tenderloin Tips and Mushrooms à la Crème
Portions: 8 Portion size: 8 oz.
Ingredients:
Butter 2 oz. Prepared mustard 2t
Onion 4 oz. Brown sauce 1 ½ Pt.
Flour 1T Heavy cream 1 cup
Mushrooms ½ lb. Salt to taste
Beef tenderloin 2 ½ lb. Pepper to taste
White wine ½ cup

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1. New yield ÷ Old yield = Conversion factor

18 ÷ 8 = 2.25
2. Convert ingredients to common units of measure.
½ lb. = 8 ounces (mushrooms)
2 ½ pounds = 40 ounces (beef tenderloin)
½ cup = 4 fluid ounces (white wine)
1 ½ pints = 24 fluid ounces (brown sauce)

3. Multiply each ingredient by the conversion factor.

Conversion
Ingredient Quantity New Quantity
Factor
Butter 2 oz. 2.25 4.5 oz.
Onion 4 oz. 2.25 9 oz.
Flour 1T 2.25 2.25 T or 2 T. plus ¾ t
Mushrooms 8 oz. 2.25 18 oz. or 1 lb. 2 oz.
Beef tenderloin 40 oz. 2.25 90 oz. or 5 lb. 10 oz.
White wine 4 fl. oz. 2.25 9 fl. oz.
Prepared mustard 2t 2.25 4 ½ t or 1 ½ T
Brown sauce 24 fl. oz. 2.25 54 fl. oz. or 3 Pt. + 6 fl. oz.
Heavy cream 8 fl. oz. 2.25 18 fl. oz. or 2 ¼ cups

Procedure for Converting Factors When Portion Size Changes

1. Determine the total yield in the old recipe by multiplying the number of portions by the portion size:
Old recipe number of portions x portion size = Old yield
2. Determine the total desired yield (new yield) by multiplying the number of portions desired by the portion
size desired:
Desired number of portions x desired portion size = New yield
3. Calculate the conversion factor.
New yield ÷ Old yield = conversion factor
4. Multiply each ingredient quantity by the conversion factor.
Example:
• A recipe with a yield of twenty 4-oz portions must be converted to make thirty 5-oz portions.
1. Old recipe number of portions x portion size = Old yield
20 portions x 4 ounces = 80 ounces
2. Desired number of portions x desired portion size = New yield
30 portions x 5 ounces = 150 ounces
3. New yield ÷ Old yield = conversion factor
150 ÷ 80 = 1.875
4. Multiply each ingredient quantity by the conversion factor.
Food Cost Calculations
Foodservice operations are businesses. This means that a person in the operation must think about budgets,
cost accounting, bills, and profits. Usually, these are the jobs of a manager, while the cook takes care of food
production.

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Cooks have a great deal of responsibility for food cost controls. They must always be conscious of accurate
measurement, portion control, and careful processing, cooking, and handling of food to avoid excess trimming
loss, shrinkage, and waste.
Food Cost Percentages
An individual operation’s food cost percentage is usually determined by the budget. The executive chef is
interested in this figure because it tells him or her whether the menu prices and the costs for each item are in
line. This food cost percentage may vary in different establishments. However, the standard industry percentage
ranges between 30-40%. Percentages higher than 50% may point out that operations probably won’t be in
business for too long (Samson, 2007). The goal of foodservice professionals is to maintain this percentage as
low as possible without sacrificing quality of food products.
The food cost percentage of a menu item equals the raw food cost or portion cost divided by the menu price
(selling price).
Percentage = Food cost ÷ Menu price x 100
Food cost = Menu price x Percentage
Menu price = Food cost ÷ Percentage
Examples:
• Menu price is P345.00 and food cost percentage is 34 percent.
Food cost = Menu price x Percentage
Food cost = P345.00 x 0.34
Food cost = P117.30
• Food cost is P117.30 and food cost percentage is 34 percent.
Menu price = Food cost ÷ Percentage
Menu price = P117.30 ÷ 0.34
Menu price = P345.00
• Food cost is P117.30 and menu price is P345.00.
Percentage = Food cost ÷ Menu price
Percentage = P117.30 ÷ P345.00
Percentage = 0.34 x 100 = 34%

Yield Cost Analysis

In order to calculate portion costs of recipes, one (1) must determine the costs of ingredients first. For many
ingredients, this is relatively easy. This may be done by basing on invoices or price lists from
suppliers/purveyors.
The percentage yield of a vegetable or fruit indicates, on the average, how much of the AP weight is left after
pre-prep to produce the ready-to-cook item or EP weight. This figure can be used to perform two (2) basic
calculations.
• Calculating yield.
Example: One (1) has 10 lb. AP carrots and its yield after trimming is 80 percent. What will be its EP
weight?
First, change the percentage to a decimal number by moving the decimal point two (2) places to the
left.
80% = 0.80
Multiply the decimal by the AP weight to get the EP yield.
10 lb. x 0.80 = 8 lb.

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• Calculating amount needed.

Example: One (1) needs 10 lb. carrots. What amount of untrimmed carrots is needed?
Change the percentage to a decimal number
80% = 0.80
Divide the EP weight needed by the decimal number to get the AP weight.
10 lb. ÷ 0.80 = 12 ½ lb. (AP weight)
In the case of ingredients such as meats and fish, figuring the cost can be a little more complicated. If
one (1) buys pre-cut portion-controlled steaks or fish fillets and use it just as it were received, then, the
AP and EP costs will be the same. But if one (1) buys a whole loin of beef or a whole fish and cut it, a
yield cost analysis must be done in order to determine actual costs.
Raw yield tests, cooked yield tests, and cutting/trimming loss calculations will be discussed on the
succeeding periods.
Portion Costs
Portion cost, or raw food cost, is the total cost of all the ingredients in a recipe divided by the number of portions
served:
Portion Cost = Cost of Ingredients ÷ Number of Portions
Many errors in costing are caused by forgetting one (1) of the following points:
• Costs must be based on AP amounts, even though recipes often give EP quantities.
• Include everything. This means that all ingredients used should be included in the costing such as the
lemon wedge and parsley garnishes for a fish fillet, the cream and sugar that go with a coffee, and the
oil used for pan-frying an eggplant. These are sometimes called hidden costs.
• Record the number of portions actually served, not just the number of recipes is intended to serve. If
one (1) dropped a piece of cake on the floor, that cost still has to be covered.
Procedure for Calculating Portion Cost
1. List the ingredients and quantities of a recipe as prepared.
2. Convert the recipe quantities to AP quantities.
3. Determine the price of each ingredient (from invoices, price lists, etc.). The units in this step and in step
2 must be the same in order to do the calculation.
4. Calculate the total cost of each ingredient by multiplying the price per unit by the number of units
needed.
5. Add the ingredient costs to get the total recipe cost.
6. Divide the total cost by the number of portions served to get the cost per portion.
Example:
Item: Baked Rice
Recipe
Ingredient AP Quantity Price Total
Quantity
Rice, long grain 4 lb. 4 lb. P31.62/lb. P126.48
Butter 12 oz. 0.75 lb P100.47/lb. 75.35
Onions 1 lb. 1.2 lb P18.36/lb. 22.03
Chicken stock 4 qt. 4 qt. P12.75/qt. 51.00
Salt 1 oz. 1/16 lb. P7.65/lb. 0.48
Total Recipe Cost P275.34
Number of Portions 50
Cost per portion P5.51

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Mark-Up Method
Mark-up is the money added to the recipe cost to obtain a selling price. The rate of mark-up is usually based
either on the prices of competitors, industry standard, or the profit that owners want to earn. This rate can be
expressed as a fraction or a percentage.
Using the mark-up method means considering not only the food cost, but also all the costs incurred in
production, labor, utilities, rent, etc., as well as the targeted profit of the establishment.
Mark-up = Recipe cost x Mark-up rate
Selling Price = Recipe cost + Mark-up
The determination of the selling price using the mark-up method comes in two (2) steps:
1. First, the mark-up must be determined by multiplying the recipe cost by the mark-up rate.
2. Then, the mark-up would be added to the recipe cost to determine the selling price.
Examples:
• The recipe for lamb ragout has a cost per serving of P58.60. The mark-up factor/rate is 2.5. The selling
price for each serving would thus be calculated as follows:
1. Determine the mark-up
Mark-up = Cost per serving x mark-up rate
= P58.60 x 2.5
= P146.50
2. Determine the selling price.
Selling price = Cost per serving + mark-up
= P58.60 + P146.50
= P205.10 or P205.00
• The cost per serving for pork medallions is P25.50. The mark-up rate is 85%. The selling price is
calculated as follows:
Mark-up = Cost per serving x mark-up rate
= P25.50 x 0.85
= P21.68
Selling price = Cost per serving + mark-up
= P25.50 + P21.68
= P47.18 or P47.00
Note: It is the discretion of a foodservice establishment to either round the calculated prices of recipes down or
up depending on its operations.

References:
Gisslen, W. (2016). Essentials of professional cooking (2nd Edition). Hoboken, NJ: John Wiley and Sons.
Samson, J.J., and Borja, M.A. (2007). Food production management. Intramuros, Manila: Mindshapers Co.,
Inc.

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Procedures:
Knowledge Check (Individual)
1. Wait for your instructor to hand you with 03 Laboratory Worksheet 1.
2. You will be given two (2) hours to accomplish this activity.
3. Submit your output within the allotted time.

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