Accurately keeping tabs on all these credits keeps the risk of vendor dispute low and gives you more clarity into your business’s financial health. Many restaurants use prepaid accounts for overhead expenses like rent, utilities, bar POS software, bar equipment, and more. There are a lot of unique one-time expenses that bars and restaurants incur that may benefit from a prepaid expense account. With perpetual inventory, inventory adjusts after every transaction. That means inventory numbers are always up-to-date and reflect, in real time, item and product levels.

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What is restaurant accounting software ?

You can use revenue reports as a financial projection tool to anticipate how much revenue you’ll generate in the future. A cash flow statement shows you whether you’re able to generate enough positive cash flow to maintain or grow your operations or whether you should seek external financing. The availability of your accounting information is a founding aspect of any restaurant’s success and ability for growth. The more information you have quick access to, the more accurate your books will be.

https://quick-bookkeeping.net/ is the system of recording, analyzing, and interpreting financial data for a restaurant. If the whole accounting process is confusing to you, it’s a good idea to hire an accountant to walk you through the steps and terminologies. A good accountant will guide you through the process while interpreting the data. Be sure to hire an accountant who has worked in the restaurant industry. One way of doing this is asking for referrals from other local managers or owners.

Restaurant Accounting

To give you a better understanding of what else is involved in restaurant accounting, let’s look at other important aspects. There are many good accounting software programs available, but if you are running a restaurant or food-related service, we picked Restaurant365 as our best overall accounting software for restaurants. We chose it because of its ability to integrate fully with other systems.

• Cost of goods sold is a KPI that indicates how well you’re pricing your products and controlling your inventory.
• Software Advice is free because vendors pay us when they receive sales opportunities.
• Your restaurant variable expenses are highly volatile and can change easily from one month to another.

CoGS represents the actual cost of food and beverage used to produce your food and beverage sales. By keeping tabs on your CoGS ratio, you can take action to reduce and contain your inventory costs. You can’t run your business without staff, which means you need know they’re being paid accurately and on time. Mistakes on payroll can cost Restaurant Accounting you your best performing employees – if not more. A P&L statement is your guiding post to drive business decisions (when and where to cut costs, how to increase revenue, whether to change your business strategy, etc.). Follow the steps in this guide and, when in doubt, contact professionals for advice as soon as a problem arises.