What should be recorded each day?
| Item from the POS summary | Account |
|---|---|
| Food sales | Food sales income |
| Beverage and alcohol sales | Beverage sales income |
| Discounts and comps | Discounts |
| Sales tax collected | Sales tax payable |
| Card tips | Tips payable, cleared through payroll |
| Cash, card and gift card payments | Cash on hand, card clearing, gift card liability |
A daily summary entry, rather than every ticket, keeps the books manageable. Card deposits then clear the card clearing account, less processing fees.
Close each day in the POS before posting, so late tickets and voids are captured, and compare each day's card deposits with the card total from the POS.
Differences of more than a few dollars are worth investigating the same week, while staff still remember the shift.
How should cash be handled?
Count each drawer at close against the POS report, record overs and shorts, and deposit cash intact rather than paying expenses from it. Paying suppliers from the till hides both sales and costs. Unrecorded cash sales are a common audit finding in restaurants.
How are delivery platforms recorded?
Record gross sales through each platform, with commissions, promotions and fees as expenses, and the payout as a deposit. Check whether the platform collects sales tax as a marketplace facilitator in your state. See refunds and chargebacks.
Delivery platforms report gross sales on Form 1099-K, so reconcile your recorded platform sales to those forms at year end. Promotions you fund on the platform are a marketing cost.
How are tips handled?
Employees must report tips to the employer, and tips are subject to income tax withholding and Social Security and Medicare taxes through payroll. Card tips paid out to staff run through payroll. Many employers can claim a credit for employer Social Security and Medicare tax paid on certain tips, and larger food and beverage establishments file an annual information return on tips. Employees may also be able to deduct qualified tips for 2025 to 2028. See how to run payroll.
Which cost measures matter?
Food cost percentage
Food purchases adjusted for inventory change, divided by food sales.
Beverage cost percentage
The same for drinks, usually lower than food.
Labor cost
Wages, payroll taxes and benefits as a share of sales.
Prime cost
Food, beverage and labor together, often the key measure.
Inventory counts
Weekly or monthly, for accurate cost percentages.
Track these weekly as well as monthly, since a spike in food cost is easier to act on within days.
Price menu items from the recipe cost, and review prices when supplier prices change.
What does an example look like?
A restaurant has $80,000 of monthly sales. Food and beverage purchases are $26,000, and inventory rose by $2,000, so cost of goods is $24,000, or 30%. Labor costs are $26,400, or 33%. Prime cost is $50,400, or 63% of sales, leaving 37% for rent, utilities, marketing and profit.
How are gift cards and comps handled?
Gift cards sold are a liability until redeemed, at which point they become sales. Comps and discounts should be recorded through the POS, not left out of sales, so food cost percentages reflect what was actually given away. Spoilage and waste should be logged, because unexplained differences between purchases and sales are a sign of waste or theft.
What are the common mistakes?
- Recording only card deposits as sales, missing cash and platform sales.
- Paying staff or suppliers from the till without recording it.
- Recording delivery platform payouts net, hiding commissions.
- Treating card tips as sales instead of a liability paid to staff.
- Counting inventory rarely, so food cost is wrong month to month.
What about sales tax?
Most prepared food and drink is taxable, with local rates and special meals taxes in some places. Record tax collected as a liability and file on schedule. See sales tax filing frequency.
Running a restaurant?
We reconcile your daily sales, delivery platforms and tips, track food and labor costs, and handle payroll and sales tax.
Questions people ask
How should restaurants record daily sales?
With a daily POS summary split into food, beverage, discounts, sales tax, tips and payment types, reconciled to deposits.
How are restaurant tips recorded?
As a liability when collected on cards, then paid out and reported through payroll.
What is prime cost?
Food and beverage cost plus labor cost, often expressed as a percentage of sales.
How should delivery app sales be recorded?
As gross sales, with commissions and fees as expenses and the payout as a deposit.
Sources
Every fee, date and rule on this page was taken from these official and primary sources.
Rules and fees change. If you are reading this long after October 1, 2026, confirm the figures with the source before you rely on them.
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This guide is general information. It is not tax or legal advice for your situation.