Skip to content

Restaurant Accounting: Bookkeeping Tips and More

how to do bookkeeping for a restaurant

Managing your inventoryprovides valuable insight about the restaurant’s COGS. Your accountant can use your COGS to determine where you’re spending too much on food, if you’re ordering too much, or if someone is stealing. You may have some burning questions about accounting for restaurants and its importance.

Liabilities are things like vendor bills and restaurant equipment loans. TouchBistro is an all-in-one POS and restaurant management system that makes running a restaurant easier.

Proven Strategies To Enhance Customer Loyalty Through Online Ordering System

Accounting software takes a lot of guesswork out of the process, and tracking things digitally will save copious amounts of time. Keeping on top of your bookkeeping is worth far more than avoiding tax season headaches. The more transparency you have into restaurant bookkeeping the key performance indicators that monitor the health of your restaurant, the more swiftly you can take decisive action to remedy wounds. You should review your prime costs, CoGs, inventory counts, and labor on a weekly basis, not a monthly basis.

Bookkeeping is the process of recording financial transactions and organizing receipts and other documentation. Accounting, meanwhile, is the practice of analyzing the information supplied by the bookkeeper and developing reports to make the numbers understandable to a non-business-oriented person. Another option is to do the bookkeeping yourself and only retain an accountant. It is a plus if you can hire a bookkeeper and accountant familiar with the hospitality industry. Unless you are an accountant or bookkeeper along with being a chef or restaurant owner, you are going to need some help in order to set up a restaurant accounting system. Even the smallest of coffee shops have to keep financial records so they can file their taxes and make good decisions to keep the business afloat.

How to Set up Accounts Payable

This is further broken down into business-specific categories or sub-accounts such as inventory, sales, and marketing. While setting up the chart of accounts, it’s important to decide the metrics you want to monitor. The more you can monitor the financial health of your restaurant, the better. MarketMan can level up your operational workflow by seamlessly integrating your bookkeeping, POS and inventory management solutions. Cost of Good Sold is a KPI that shows how accurately you’re pricing your food items and controlling your inventory.

How do you account for restaurant expenses?

Simply put, a restaurant's prime cost is COGS + labor costs. The prime cost constitutes a majority of a restaurant's expenses because it includes all of the food and beverage ingredients, as well as all payroll costs, taxes, and benefits. Prime cost is an important accounting term to know as a restaurant owner.

Leave a Reply

Your email address will not be published. Required fields are marked *