Food costing is the process of calculating the total expenses involved in producing a dish or menu item. This includes the cost of ingredients, labor, overhead, and any other expenses related to food preparation. By understanding these costs, businesses can set appropriate prices to ensure profitability. Accurate food costing helps restaurants and food service operations manage their budgets effectively. It allows them to identify which items are profitable and which may need adjustments. This practice is essential for maintaining financial health and making informed decisions about menu offerings and pricing strategies.