Bookkeeping, payroll, and reporting for Lexington restaurants and food service operators, where food cost plus labor decides whether the month works.
Prime cost is food plus labor as a share of sales, and in this business it is the number that decides everything. If you only see it once a month, when the P&L finally shows up three weeks after close, you are looking at a problem you can no longer fix. By then the shifts are worked, the food is served, and the money is gone.
We set up restaurants so prime cost is visible weekly. Sales come in from the POS daily. Invoices get coded to food, beverage, and paper as they arrive. Labor gets pulled from the payroll system by week, not by pay period, so it lines up with sales. For operators in Lexington, Nicholasville, and Georgetown, that means a Tuesday morning number for last week instead of a mid-month surprise, and enough lead time to change a schedule or push back on a vendor increase.
The weekly rhythm is the whole system. Sales from the POS, split between food, beverage, and any catering or retail. Purchases coded by category as invoices come in, with a proper inventory adjustment at period end so you are measuring what you used rather than what you bought. Labor pulled by the same week, including the payroll taxes and benefits that turn a wage number into real cost. Put them together and you have prime cost as a percentage, tracked week over week. When it moves, you know within days and you know which side moved. That is the difference between managing the restaurant and reading about it later.
Restaurant payroll is one of the more complicated ones out there. Tipped wages with tip credit, overtime calculated on the right base rate, service charges that are not tips, tip pooling arrangements, high turnover generating a steady stream of new hires and terminations, and payroll tax filings that come due no matter how the week went. We run payroll through ADP, Paychex, Paycor, Gusto, RUN Powered by ADP, or QuickBooks Payroll, keep the filings on schedule, and report labor by department so you can see whether kitchen or front of house is where the hours are drifting.
Get prime cost right and you still have to survive occupancy, utilities, insurance, and the fees that quietly stack up. Third-party delivery commissions can take a serious cut of every order that comes through the app, and if that revenue is recorded net of commission you never see what it costs you. Card processing fees on a high-volume, low-ticket business add up. So do repairs, small wares, linen, and pest control, which everyone forgets until they total them. We separate every one of these so controllable costs are visible next to fixed ones, and you can see which lever is actually available when a month runs tight.
Sales tax collected is not your money, and in a cash-heavy business it is easy to spend it without meaning to. We keep the liability tracked separately and file the returns on time so a quiet balance does not turn into penalties. On the cash side, restaurants deposit daily and pay vendors on staggered terms, which makes the account balance a terrible indicator of health. A short-cycle forecast built off your sales pattern and vendor due dates shows the tight weeks in advance. If you are planning a second location or a build-out, that is fractional CFO work and it starts with a model, not a hope.
Once the setup is done, prime cost for the prior week is typically ready early the following week. It depends on invoices arriving and inventory counts being taken on a consistent day. The systems are not the hard part. The discipline of counting on the same day every week is what makes the number trustworthy.
No. Baum's Accounting Services does not prepare income tax returns and is not a CPA firm. Sales tax compliance and payroll tax filings are handled here. Income tax filing goes to an outside CPA, and you will hand them books that are closed, reconciled, and easy to work from.
Yes, and you should. Each location gets its own P&L with its own prime cost, plus a consolidated view. Shared overhead gets allocated on a basis that makes sense so one location does not look artificially strong. Comparing the two side by side usually explains more than either statement does alone.
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