Key Terms

Key Terms

as purchased (AP) weight

The gross weight

average cover

The average amount spent by a customer in a meal period or month

baker’s percentage

A formula that states the ingredients in relation to the amount of flour

breakeven point

The point at which cost and revenue are equal


Physical assets or money used in the production of goods and services

closing inventory

The amount of product on hand at the end of the inventory period

contribution margin

Portion of sales that can be applied against fixed costs; gross sales minus variable costs


1. Number of items in stock
2. Number of items in a case or to the pound or kilogram


Products purchased and used as soon as they arrive or on the same day

edible product (EP) weight

The amount of usable product after cleaning or portioning


Calculating the total value of goods on hand after taking a physical inventory


First in, first out; a system of managing inventory so that the product received first gets used first

fixed costs

Costs which do not change based on the volume of business

food cost

The direct cost of food


Total goods in stock at any one time


A document indicating the amount owed for goods or services

labour cost

The cost of labour required for a fixed period of time; usually reflected as a percentage of sales

menu engineering

1. To maximize profitability by encouraging customers to buy what you want them to buy
2. Structuring of a menu to balance low- and high-profit items to achieve overall target food costs and profit

opening inventory

The amount of product on hand at the start of the inventory period.


The ongoing expenses required to operate a business that are not direct costs of producing goods or services

packing slip

A document indicating the products shipped for delivery

par stock

Maximum amount of an item that should be in stock at any one time

perpetual inventory

A system of tracking product as it is received and used, thereby keeping a running total of items on hand


physical inventory

A physical inventory requires that all items in storage be counted periodically.

point-of-sale (POS) system

A computerized system that coordinates customer purchases, sales, and costs through various linked terminals in a business

portion cost

The cost of a single portion


A measure of the amount of work done in a fixed period


Any revenue left over after all costs have been covered


The amount of profit a business generates compared to sales, usually reflected in a percentage

purchase order

A document indicating the approval of a quantity of goods ordered from a supplier


The proportion between two amounts, usually with one item being referred to as 1


The individual responsible for accepting and checking deliveries


To rearrange inventory so that the oldest product is placed in front of newly acquired product


Total revenue received for goods or services in a fixed period


Purchase criteria such as size, grade, packaging, market form

specific gravity

The density of a substance (mass for a given volume), when compared against a reference substance, such as water

standardized recipe

Consistent, tested recipe that is used by everyone in the kitchen to prepare the same product


Goods taken from the storage area and used


1. Number of times in a period that inventory is turned into revenue
2. Number of times in a day that a seat is filled

variable costs

Costs that change based on business volume or sales


1. Quantity of product or business
2. A type of measurement that measures the space taken up by a substance


Amount of usable product

yield test

A test to determine the net or edible product (EP) weight from the gross or as purchased (AP) weight



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Basic Kitchen and Food Service Management Copyright © 2015 by The BC Cook Articulation Committee is licensed under a Creative Commons Attribution 4.0 International License, except where otherwise noted.

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