Perhaps the most problematic account in restaurants is payroll. Restaurant workers may be both full-time and part-time workers at different rates of pay. It is advisable to either outsource your payroll services or, at least, use specific payroll software for this task.
In a restaurant, your inventory will consist of two broad classes: food and supplies. Track your inventory so you won’t have too much, which will end up as waste, or too little, which will hurt your sales. You want to keep your average daily inventory as low as possible without causing shortages. Your POS software is invaluable in helping you keep track of your inventory.
Accounts payable is what you owe your suppliers and is listed on your balance sheet. When you receive an invoice, input it into your accounting software. In this way, you won’t be late paying your bills. A good relationship with your suppliers and vendors will help your business run smoothly.
Keep track of how much cash goes into and out of your business. It’s helpful to know your cash flow on a daily, weekly, monthly, and quarterly basis. Developing both a cash budget and a statement of cash flows will help you track your cash flow.
It is important for a restaurant owner to know how much of your sales come from food and how much from beverages. You can further break this down into eat-in meals, carry-out meals, and even into different menu items by using your accounting software.
Cost of Goods Sold
Cost of goods sold (COGS) in a restaurant consists of all the food and supplies used to make the items on your menu. You should distinguish COGS from the other costs of running a business, such as rent and utilities or occupancy costs. The chart of accounts for a restaurant lists all occupancy costs as expenses while food and supplies are listed under COGS.