Food Bookkeeping Categorization

Food Bookkeeping Categorization

Food Bookkeeping Categorization

If we buy chicken, where do we categorize it for bookkeeping purposes? Do we classify it under Groceries?

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Jul 29, 2018
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Food Bookkeeping Classification
by: Stephanie

Thank you for your bookkeeping question about where you should categorize food.

The answer for where you should classify a food purchase such as chicken, is dependent upon what the purchase is for.

If the purchase of chicken is for personal purposes only, it would be categorized as an Owner's Draw with a subcategory of Groceries which would show on the Balance Sheet Statement.

If the purchase of chicken is for a business meal with a client or for business travel, it would be categorized as a Meal & Entertainment Expense which would show on the Profit & Loss Statement

If the purchase of chicken is for a business event in which you are providing food for the event, it would be categorized as a Food Expense which would show on the Profit & Loss Statement as well but would not be limited to the 50% tax deduction limitation.

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