The language of gas station accounting, explained
Plain-English definitions for the fuel, store, cash and tax terms in your books, each with a link to a deeper guide.
A
ATG (automatic tank gauge)
An ATG is a probe and console that measures the fuel level and temperature in each underground tank automatically.
Read definition → StoreAverage ticket (basket size)
Average ticket is the average amount spent per transaction, found by dividing sales by the number of transactions.
Read definition →B
Batch settlement
A batch settlement is the group of card sales sent to the processor at close of day, which is then deposited to your bank a day or more later.
Read definition → FuelBill of lading (BOL)
A bill of lading is the document issued at the fuel terminal that records what was loaded onto the truck for your delivery.
Read definition → FuelBranded vs unbranded
A branded station sells fuel under an oil company's name and rules, while an unbranded (independent) station buys fuel on the open market and sets its own brand.
Read definition → AccountingBreak-even point
The break-even point is the level of sales at which your total gross profit exactly covers your fixed and variable costs.
Read definition → Tax & complianceBSA/AML
The Bank Secrecy Act and its anti-money-laundering rules require certain businesses to keep records and report certain activity.
Read definition →C
Capital expenditure (CapEx)
CapEx is money spent on assets that last for years, such as new dispensers, tanks, canopies or store equipment.
Read definition → Cash & paymentsCash discount pricing
Cash discount pricing means posting a lower price for cash than for cards, to pass some of the card processing cost on to the customer.
Read definition → Cash & paymentsCash over and short
Cash over and short is the difference between the cash a register should hold according to the POS and what is actually counted.
Read definition → AccountingCash vs accrual accounting
Cash accounting records income and costs when money moves; accrual accounting records them when they are earned or incurred.
Read definition → FuelCents per gallon (CPG)
Cents per gallon is the profit you make on each gallon of fuel sold, quoted before or after fees and costs.
Read definition → Cash & paymentsChargeback
A chargeback is when a card issuer takes back a payment after the customer disputes the transaction.
Read definition → AccountingChart of accounts
The chart of accounts is the list of categories your bookkeeping uses to record income, costs, assets and debts.
Read definition → AccountingCost of goods sold (COGS)
COGS is what you paid for the fuel and merchandise you actually sold in a period.
Read definition → StoreCredit memo
A credit memo is a document from a vendor reducing what you owe, for returns, damaged goods, pricing errors or promotions.
Read definition →D
Debt service coverage ratio (DSCR)
DSCR is operating profit divided by your loan payments (principal and interest), showing whether the business earns enough to cover its debt.
Read definition → AccountingDepreciation
Depreciation spreads the cost of a long-lasting asset, such as a tank, pump or building, over the years it is used.
Read definition → FuelDrive-off
A drive-off is when a customer pumps fuel and leaves without paying.
Read definition → FuelDrop ticket (delivery receipt)
A drop ticket is the receipt the driver leaves showing how much fuel was delivered into each tank.
Read definition → StoreDry stock
Dry stock is everything you sell that is not fuel: packaged goods, drinks, tobacco, snacks and other store merchandise.
Read definition → StoreDSD (direct store delivery)
DSD means a vendor delivers goods straight to your store and often stocks the shelf, instead of sending them to a warehouse first.
Read definition →E
EBITDA
EBITDA is earnings before interest, taxes, depreciation and amortization, a common measure of operating profit used when buying, selling or financing a business.
Read definition → Cash & paymentsEBT and SNAP
EBT is the electronic system used to deliver benefits such as SNAP, which can be spent only on eligible foods at authorized retailers.
Read definition →F
FIFO and LIFO
FIFO (first in, first out) and LIFO (last in, first out) are ways of deciding which purchase cost is matched to the inventory you sell.
Read definition → Cash & paymentsFleet card
A fleet card (such as WEX or Comdata) lets a business pay for fuel and sometimes other items, with the money settled to the station by the card network.
Read definition → Tax & complianceForm 1099-K
Form 1099-K reports card and payment-app receipts that a processor paid to your business during the year.
Read definition → Tax & complianceForm 8300
Form 8300 is the IRS form businesses file when they receive more than $10,000 in cash in one transaction or related transactions.
Read definition → FuelFreight (delivery charge)
Freight is the charge for hauling fuel from the terminal to your station, usually quoted per gallon or per load.
Read definition →G
Gross margin
Gross margin is sales minus the direct cost of what you sold, shown as a dollar amount or a percentage of sales.
Read definition → FuelGross vs net gallons
Gross gallons are the physical volume at the actual fuel temperature; net gallons are that volume adjusted to a standard 60°F.
Read definition →I
Inside sales
Inside sales are everything sold in the store itself, as opposed to fuel sold at the pump.
Read definition → Cash & paymentsInterchange and card fees
Interchange is the fee a merchant pays on each card sale; together with processor charges it forms your card processing cost.
Read definition → StoreInventory turnover
Inventory turnover is how many times you sell through your average stock in a period, found by dividing cost of goods sold by average inventory.
Read definition →L
Leak detection
Leak detection is the set of tests and monitoring used to confirm that underground tanks and lines are not losing fuel.
Read definition → StoreLottery commission
The lottery commission is the percentage a retailer earns on lottery tickets sold; the rest of the sales belong to the lottery.
Read definition →M
Markup vs margin
Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price.
Read definition → AccountingMonth-end close
The month-end close is the routine of reconciling accounts and checking the books so a month's numbers can be relied on.
Read definition → Tax & complianceMotor fuel tax (excise tax)
Motor fuel tax is a per-gallon tax on gasoline and diesel, charged by the federal government and by each state.
Read definition →S
Safe drop (cash drop)
A safe drop is when a cashier moves excess cash from the register into a locked safe during a shift, with a record of the amount.
Read definition → Tax & complianceSales tax on store items
Sales tax in a station is collected on taxable store items and filed with the state or local authority, separately from fuel taxes.
Read definition → StoreScan data (rebate programs)
Scan data programs pay a store a rebate for sending item-level sales data to a manufacturer, usually for tobacco and some other categories.
Read definition → StoreShrink (shrinkage)
Shrink is inventory you paid for but cannot account for through sales, caused by theft, waste, damage or record-keeping mistakes.
Read definition → FuelStick reading
A stick reading is a manual tank measurement taken by lowering a calibrated stick into the tank and reading the fuel level.
Read definition → FuelSupply agreement
A supply agreement is the contract in which a station agrees to buy fuel from a supplier, often with minimum volumes, term and incentives.
Read definition →T
Tank chart (calibration chart)
A tank chart converts a measured fuel depth in a specific tank into gallons.
Read definition → FuelTerminal
A terminal is the bulk storage facility where tanker trucks load fuel from a pipeline or barge before delivering it to stations.
Read definition → Tax & complianceTobacco excise tax
Tobacco excise tax is a per-pack or per-unit tax on cigarettes and other tobacco products, usually paid through the distributor.
Read definition →W
Water in tank
Water in a fuel tank is water that has collected at the bottom, which reduces sellable fuel and can damage engines and equipment.
Read definition → FuelWet stock
Wet stock is the liquid fuel in your underground tanks: gasoline, diesel and any other fuel you sell.
Read definition → FuelWet stock variance
Wet stock variance is the difference between the fuel your records say you should have and the fuel actually in the tanks.
Read definition → AccountingWorking capital
Working capital is the money available for day-to-day needs, found by subtracting current liabilities from current assets.
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