What do COGS and food costs refer to in a food service context?

In the context of food service, COGS, or Cost of Goods Sold, and food costs specifically refer to the direct costs associated with producing the food items that are sold to customers. While "food used" is a phrase that can align with understanding COGS and food cost calculations, it is essential to note that these figures are typically quantifiable metrics used to manage and analyze the profitability of a food service operation.

When calculated, food costs often reflect the actual cost of the ingredients purchased and utilized during a specific period, which can include factors such as waste, spoilage, and discrepancies in portioning. Therefore, a statement indicating that food used is a specific percentage higher than theoretical makes sense in this context, as it implies that the actual usage is monitored against what is expected (theoretical costs). This comparison helps operators identify areas where efficiencies can be improved or waste minimized.

The other choices do not align with the definition of COGS and food costs. They refer to different aspects of operating expenses within a food service business. For instance, common area maintenance expenses are generally related to property management rather than food service metrics, while labor costs and overhead expenses pertain to staffing and operational requirements, not the cost of food sold. Similarly,