HOS-REST26-07 · Lesson 5 · 14 clock hours · lab
End-of-Day Reporting and Sales Analysis
Objective. Students run POS end-of-day close procedures, generate shift and daily sales reports, and calculate food cost percentage and labor cost percentage from report data within ±1% of instructor benchmarks.
⚠ Pending professional review
This lesson, its worked examples and its practice questions has not yet been verified by a certified food-safety manager and industry professional or by a certification or approval body. It is a study draft and may contain errors. Do not use it as instructions for work on a job site or on live equipment. Always follow your instructor, your supervising professional, and current official references and regulations.
VoTechWorks program approval and accreditation are still in progress. Credentials are issued only by the certifying bodies named in each program, after their own exams.
What the End-of-Day Close Accomplishes
At the end of every shift or business day, a restaurant manager runs a structured closing sequence on the point-of-sale (POS) system. This process reconciles every dollar that entered and left the operation during that period. A clean close protects the restaurant from cash loss, surfaces pricing or discount errors before they compound, and produces the data you need to manage food cost and labor cost. Health departments, auditors, and ownership all rely on the integrity of these records.
The Z-Report
The most important output of the end-of-day close is the Z-report. When you run a Z-report the POS finalizes the current trading period, prints a full summary of all transactions, and resets the counters to zero so the next shift starts fresh. You cannot "undo" a Z-report, which is why you run it only at the designated close time and never before the final guest check is settled.
A standard Z-report shows:
- Gross sales – total revenue before any deductions
- Voids – transactions canceled before settlement
- Comps – meals provided free of charge (employee meals, guest-recovery)
- Discounts – coupons, promotions, happy-hour reductions
- Net sales – gross sales minus voids, comps, and discounts
- Payment-method breakdown – cash, credit/debit card, gift card totals
- Cover count – number of guests served
Cash Drawer Reconciliation
After running the Z-report, count the cash drawer carefully:
1. Remove and set aside the starting bank (the float placed at the beginning of the shift).
2. Count the remaining cash using a systematic bill-by-denomination method to reduce counting errors.
3. Record the counted amount on your reconciliation sheet.
4. Compare your physical count to the cash total shown on the Z-report.
5. Calculate the overage or shortage: Physical Count − Z-Report Cash Total = Variance.
A variance of zero is the goal. Most operations set an acceptable tolerance (often a few dollars). Variances outside that tolerance must be documented and investigated before the manager signs off. Never assume a shortage is acceptable without following your property's cash-handling policy.
Safety note: Handle cash in a secure area away from public sight. When transporting the deposit, follow your property's escort and drop-safe procedures. Lone-worker and robbery-prevention policies apply during this task.
Credit Card Batch Settlement
After counting cash, settle the credit card batch. The POS groups all card transactions into a batch that must be transmitted to the card processor. Log into the appropriate terminal or software module, verify the batch total matches the card total on your Z-report, and submit. Print or save the batch confirmation. A mismatch between the POS card total and the batch total must be resolved with the processor before you close—do not leave it for the next shift.
Calculating Food Cost Percentage
Food cost percentage tells you what fraction of food revenue was spent purchasing the food that generated it.
Formula:
> Food Cost % = (Cost of Food Sold ÷ Net Food Sales) × 100
Cost of food sold is typically obtained from your inventory and purchasing records for the period. Net food sales come from the daily sales report. A well-run full-service restaurant commonly targets a food cost percentage in the low-to-mid thirties, though the right benchmark depends on the concept and menu mix. Your operation's target is set by ownership or the general manager—your job is to measure against that target and flag deviations.
Calculating Labor Cost Percentage
Labor cost percentage measures what fraction of revenue pays wages, salaries, and related labor expenses.
Formula:
> Labor Cost % = (Total Labor Cost ÷ Net Sales) × 100
Total labor cost includes hourly wages, salaried manager allocations, and payroll taxes and benefits if your property includes them. The daily labor cost figure often comes from your scheduling software or a payroll summary printed alongside your sales report. High labor cost on a slow day is normal; the manager's job is to adjust staffing decisions to keep the ratio in line over time.
Reading Two Weeks of Data for Trends
A single day's report is a snapshot. Two weeks of daily reports reveal patterns: which days of the week drive volume, which shifts run high labor cost, and where voids or comps spike. When writing a management note based on this data:
- State the observation ("Tuesday and Wednesday posted the lowest net sales of the two-week period.").
- Offer a plausible cause grounded in restaurant operations (slow mid-week traffic, limited bar promotion).
- Recommend one concrete operational adjustment (adjust staffing levels, introduce a weekday promotion, shift prep labor to higher-volume days).
Keep notes factual, brief, and actionable. Ownership and the general manager read these notes to make scheduling and marketing decisions.
Documentation and Accuracy Standards
Every figure you record on a reconciliation sheet or calculation worksheet becomes part of the operation's financial record. Write legibly, show your arithmetic, and initial your work. If you discover an error after closing, document the correction with a note explaining what changed and why—never erase or white-out an original entry. This discipline supports the internal controls that protect both the business and you as the manager on duty.
Key terms10
Z-reportA POS-generated end-of-period report that summarizes all transactions and resets the system counters to zero; it cannot be reversed once run.
Gross salesTotal revenue recorded by the POS before subtracting voids, comps, or discounts.
Net salesRevenue remaining after voids, comps, and discounts are subtracted from gross sales; the figure used as the denominator in cost percentage calculations.
VoidA transaction that is canceled and removed from the POS record before the check is settled, resulting in no charge to the guest.
CompA meal or item provided to a guest free of charge, typically for service recovery or as an employee meal, recorded separately from voids.
Food cost percentageThe ratio of the cost of food sold to net food sales, expressed as a percentage; calculated as (Cost of Food Sold ÷ Net Food Sales) × 100.
Labor cost percentageThe ratio of total labor cost to net sales, expressed as a percentage; calculated as (Total Labor Cost ÷ Net Sales) × 100.
Cash varianceThe difference between the physical cash count and the cash total reported by the POS; a positive variance is an overage, a negative variance is a shortage.
Batch settlementThe process of transmitting all credit and debit card transactions accumulated during a period to the card processor for payment.
Cover countThe total number of guests served during a defined period, used to calculate average check and to evaluate staffing needs.
Worked examples4
1. The Z-report shows gross sales of $4,820.00. Voids total $95.00, comps total $60.00, and discounts total $115.00. Calculate net sales.
- Identify all deductions: voids $95.00 + comps $60.00 + discounts $115.00.
- Add the deductions together: $95.00 + $60.00 + $115.00 = $270.00.
- Subtract total deductions from gross sales: $4,820.00 − $270.00 = $4,550.00.
Answer: Net sales = $4,550.00
2. The daily purchasing and inventory records show a cost of food sold of $1,560.00. Net food sales for the day are $4,550.00. Calculate food cost percentage.
- Write the formula: Food Cost % = (Cost of Food Sold ÷ Net Food Sales) × 100.
- Divide cost by sales: $1,560.00 ÷ $4,550.00 = 0.34286 (carry at least four decimal places).
- Multiply by 100 to convert to a percentage: 0.34286 × 100 = 34.286%.
- Round to one decimal place as standard practice: 34.3%.
Answer: Food cost percentage ≈ 34.3%
3. The payroll summary for the same day shows total labor cost of $1,183.00. Net sales are $4,550.00. Calculate labor cost percentage.
- Write the formula: Labor Cost % = (Total Labor Cost ÷ Net Sales) × 100.
- Divide labor cost by net sales: $1,183.00 ÷ $4,550.00 = 0.26000 (rounded to five decimal places: 0.26000).
- Multiply by 100: 0.26000 × 100 = 26.0%.
Answer: Labor cost percentage = 26.0%
4. After running the Z-report, the cash drawer is counted. The Z-report shows a cash total of $812.00. The starting bank was $200.00. The physical count of the entire drawer is $1,009.00. Calculate the cash variance.
- Determine actual cash collected by subtracting the starting bank from the full drawer count: $1,009.00 − $200.00 = $809.00.
- Subtract the Z-report cash total from the physical cash collected: $809.00 − $812.00 = −$3.00.
- A negative result means a shortage: the drawer is $3.00 short of what the POS recorded.
Answer: Cash variance = −$3.00 (shortage of $3.00)
The math in this lesson1
Learners subtract voids, comps and discounts from $4,820 gross to find $4,550 net sales.
A-SSE.1
In class: Perform a complete end-of-day close on the training POS: run a Z-report, count and record the cash drawer, enter credit card batch totals, and identify any discrepancy between POS totals and physical count. · Using a provided set of POS daily sales reports (covers, revenue by category, voids, comps, discounts), calculate gross sales, net sales, food cost %, and labor cost % on a structured worksheet, showing all arithmetic steps. · Compare two weeks of simulated daily report data, identify the two highest and two lowest revenue days, and write a three-sentence management note explaining possible causes and one recommended operational adjustment.
Materials: POS training software, printed sample Z-reports and daily sales report packets, calculator, structured calculation worksheet, lab log workbook
Check: Completed worksheet reviewed by instructor; all four financial calculations must be within ±1% of the instructor answer key, and the end-of-day close procedure must be completed in correct sequence for a pass.
Practice check8
Answer each question, then check it. Nothing is recorded; this is your own practice.
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