Clover Sport has updated the way we define and calculate important financial metrics such as gross sales, net sales, taxes, and fees (surcharges and order level adjustments) in order to reflect widely accepted accounting standards.
As a result, you will be able to quickly and intuitively understand the financial status of your food and beverage operations. You can use our tooltips and report information to understand how these financial metrics are calculated. Additionally, you will be able to easily replicate and validate your data.
This article outlines the changes to the following reporting metrics: Gross Sales, Net Sales, and Total Sales.
Gross Sales
Gross Sales represents the total amount of revenue without accounting for costs associated with sales. Gross Sales excludes Taxes, Surcharges, Tips, Gratuities, and non-revenue items.
If your menu is Tax Inclusive, the calculation of Gross Sales is:
Gross Sales = Subtotal + Adjustments - Inclusive Taxes
Gross Sales does not account for adjustments, such as item level discounts or refunds. If you apply a discount to a line item, add it back in to your subtotal to find Gross Sales.
Gross Sales is represented arithmetically by the following expression:
sum(Item Price*Qty + Modifier Price*Qty) - Inclusive Tax
If your menu is Tax Exclusive, the calculation of Gross Sales is:
Gross Sales = Subtotal + Adjustments
Gross Sales is represented arithmetically by the following expression:
sum(Item Price*Qty + Modifier Price*Qty)
Net Sales
Net Sales represents the net sales adjusted for associated costs to gross. Net Sales excludes Taxes, Surcharges, Tips, Gratuities, and non-revenue items.
The calculation of Net Sales is:
Net Sales = Gross Sales - Adjustments (Adjustments = All costs associated with a sale)
Total Amount Collected
Total Amount Collected represents the total amount of monies collected.
The calculation of Total Amount Collected is:
Total Amount Collected = Net Sales + Surcharges + Gratuities + Total Tips + Total Taxes (Exclusive + Inclusive + Tax on Surcharge)
Map Example Orders to Reports
Note: Clover Sport Manager allows you to choose whether your Surcharge is taxable or non-taxable. All of the example orders below have Surcharges that are non-taxable.
Order A:
The following order is from a Tax Exclusive menu with a 10% Exclusive Tax Rate.
|
Items |
Quantity of Item |
Price of Item |
QTY x Price |
Item Level Adjustment |
Subtotal |
|
Ice cream |
4 | $10.00 |
$40.00 |
None |
$40.00 |
|
Bottled Water |
1 |
$5.00 |
$5.00 |
10% Discount (-$0.50) |
$4.50 |
|
Sum |
N/A |
N/A |
$45.00 |
N/A |
$44.50 |
Below we've added the Custom Discount, Surcharge, Auto Gratuity, Tip, and Exclusive Tax onto the Subtotal to get the Total Amount Collected.
|
Subtotal |
$44.50 |
Subtotal accounts for item level discounts. |
|
Custom Discount |
100% (-$44.50) |
A 100% Custom Discount was applied to this order. |
|
Flat Surcharge |
$2.00 |
A $2.00 Flat Surcharge was applied to this order. |
|
Auto % Gratuity |
$6.75 |
A 15% Auto Gratuity was applied to this order. |
|
Tip |
None |
No Tip was applied to this order. |
|
10% Exclusive Tax |
$0.00 |
A 10% Tax was applied to $0.00 since there was a 100% Custom Discount on this order, which totals to $0.00 paid in tax. |
|
Total Amount Collected: |
$8.75 |
The total amount of monies collected. |
Based on Order A, what is reported?
Gross Sales: $45.00
- Definition: Subtotal + Adjustments
-
Calculation: (10.00*4) + (5.00*1) = 45.00
- In this case, it does not account for the 10% Discount on the Bottled Water and there is no Inclusive Tax to subtract.
Net Sales: $0.00
- Definition: Gross Sales - Adjustments (Adjustments = all costs associated with the sale)
- Calculation: $45.00 - $0.50 - $44.50 = $0.00
Total Amount Collected: $8.75
-
Definition: Net Sales + Surcharges + Gratuities + Total Tips + Total Taxes
- Total Taxes = Exclusive + Inclusive + Tax on Surcharge
- Calculation: $0.00 + $2.00 + $6.75 + $0.00 + $0.00 = $8.75
Order B:
The following order contains 2 items from a Tax Exclusive menu with an 11% Tax Rate and 1 item from a Tax Inclusive Menu with a 10% Tax Rate.
|
Menu |
Items |
Quantity of Item |
Price of Item |
QTY x Price |
Item Level Adjustment |
Subtotal |
|
Tax Exclusive |
Gum |
1 |
$0.05 |
$0.05 |
None |
$0.05 |
|
Tax Exclusive |
Fries |
1 |
$2.00 |
$2.00 |
10% Discount (-$0.20) |
$1.80 |
|
Tax Inclusive |
Souvenir Cup |
1 |
$20.00 |
$20.00 |
None |
$20.00 |
|
Sum |
N/A |
N/A |
N/A |
$22.05 |
N/A |
$21.85 |
Below we've added the Custom Discount, Surcharge, Auto Gratuity, Tip, and Exclusive Tax onto the Subtotal to get the Total Amount Collected.
|
Subtotal |
$21.85 |
Subtotal accounts for item level discounts. |
|
Custom Discount |
None |
No Custom Discount was applied to this order. |
|
Flat Surcharge |
$3.00 |
A $3.00 Flat Surcharge was applied to this order. |
|
Auto % Gratuity |
$2.205 |
A 10% Auto Gratuity was applied to this order. |
|
Tip |
$1.04 |
A Tip was applied to this order. |
|
11% Exclusive Tax |
$0.20 |
The 11% Exclusive Tax Rate was applied to the Gum and Fries only. Tax Calculation: 0.11*1.85 = 0.2035 |
|
Total Amount Collected: |
$28.295 |
The total amount of monies collected. |
Based on Order B, what is reported?
Gross Sales: $20.23
- Definition: Subtotal + Adjustments - Inclusive Tax
-
Calculation: $22.05 - $1.82 = $20.23
-
10% Inclusive Tax applied to $20 Souvenir Cup: $1.82
- Formula: Gross amount - (Gross Amount / 1.(Tax amount without a decimal point)) = Tax amount
- Calculation: 20 - (20/1.1) = 1.82
-
10% Inclusive Tax applied to $20 Souvenir Cup: $1.82
Net Sales: $20.03
- Definition: Gross Sales - Adjustments (Adjustments = all costs associated with the sale)
-
Calculation: $20.23 - $0.20 = $20.03
- In this case, there was a 10% Discount on the Fries, which equals $0.20.
Total Amount Collected: $28.295
-
Definition: Net Sales + Surcharges + Gratuities + Total Tips + Total Taxes
- Total Taxes = Exclusive + Inclusive + Tax on Surcharge
- Calculation:$20.03 + $3.00 + $2.205 + $1.04 + $0.20 + $1.82 = $28.295
Order C:
The following order contains 2 items from a Tax Inclusive menu with a 10% Inclusive Tax Rate and 1 item from a Tax Exclusive Menu with a 10% Exclusive Tax Rate.
|
Menu |
Items |
Quantity of Item |
Price of Item |
QTY x Price |
Item Level Adjustment |
Subtotal |
|
Tax Inclusive |
Side of Ranch |
1 |
$1.00 |
$1.00 |
None |
$1.00 |
|
Tax Inclusive |
Burger |
1 |
$10.00 |
$10.00 |
None |
$10.00 |
|
Tax Exclusive |
Fries |
1 |
$2.00 |
$2.00 |
10% Discount (-$0.20) |
$1.80 |
|
Sum |
N/A |
N/A |
N/A |
$13.00 |
N/A |
$12.80 |
Below we've added the Custom Discount, Surcharge, Auto Gratuity, Tip, and Exclusive Tax onto the Subtotal to get the Total Amount Collected.
|
Subtotal |
$12.80 |
Subtotal accounts for item level discounts. |
|
Custom Discount |
100% (-$12.80) |
A 100% Custom Discount was applied to this order. |
|
Flat Surcharge |
$2.00 |
A $3.00 Flat Surcharge was applied to this order. |
|
Auto % Gratuity |
$1.95 |
A 10% Auto Gratuity was applied to this order. |
|
Tip |
$0.00 |
No Tip was applied to this order. |
|
10% Exclusive Tax |
$0.00 |
A 10% Tax was applied to $0.00 since there was a 100% Custom Discount on this order, which totals to $0.00 paid in tax. |
|
Total Amount Collected: |
$3.95 |
The total amount of monies collected. |
Based on Order C, what is reported?
Gross Sales: $12.00
- Definition: Subtotal + Adjustments - Inclusive Tax
-
Calculation: $13.00 - $0.091 - $0.909 = $12.00
-
10% Inclusive Tax applied to Side of Ranch: $0.091
- Formula: Gross amount - (Gross Amount / 1.(Tax amount without a decimal point)) = Tax amount
- Calculation: 1 - (1/1.1) = 0.091
-
10% Inclusive Tax applied to Burger: $0.909
- Formula: Gross amount - (Gross Amount / 1.(Tax amount without a decimal point)) = Tax amount
- Calculation: 10.00 - (10/1.1) = 0.909
-
10% Inclusive Tax applied to Side of Ranch: $0.091
Net Sales: $0.00
- Definition: Gross Sales - Adjustments (Adjustments = all costs associated with the sale)
- Calculation: $12.80 - $12.80 = $0.00
Total Amount Collected: $3.95
-
Definition: Net Sales + Surcharges + Gratuities + Total Tips + Total Taxes
- Total Taxes = Exclusive + Inclusive + Tax on Surcharge
- Calculation: $0.00 + $2.00 + $1.95 + $0.00 + $0.00 = $3.95
What Changed?
Below is a summary of how reporting metrics have changed:
| Before: | Now: |
| Gross Sales = Total Sales - Exclusive Taxes - Gratuities - Surcharges | Gross Sales = Subtotal + Adjustments - Inclusive Taxes |
| Net Sales = Gross Sales + Surcharges - Discounts - Gratuities - Taxes |
Net Sales = Gross Sales - Adjustments (Adjustments = All costs associated with a sale) |
| Total Sales named Total Sales |
Total Sales renamed Total Amount Collected (Total Taxes = Exclusive + Inclusive + Tax on Surcharge) |