Restaurant Schedule C Audit - Inventory items withdrawn for personal use

[taxxcpa]

Personal use of food

When I was an Air Force auditor I asked a mess Sgt if cooks on separate rations paid for their food. He said he didn't eat anything except to taste it to see that it was OK

[94546]

Personal Food Usage in a small family restaurant

I have an Information Document Request from the IRS with a requesting a "description and computation of the cost of inventory withdrawn for personal use". What do I tell them: "incidental"? or, "ok we'll take 5% personal use"?
Should restaurants figure a personal use % into their purchases of food? Can they deny all food purchases because we don't have a personal use amount? This seems to be a ridiculous contention. This is for a small family restaurant with a Gross of about 350K.

My experience with restaurants audits has been to don't disclose any discussion whatsoever as to if there is personal usage of food products purchased. It is considered to be very common for some kind of personal usage and it truly cannot be challenged if your food cost is within an acceptable range of the restaurant industry withing your city or State. Just tell them you have no way of knowing how much food is eaten for personal use and just proceed with the audit. They will not pursue if your cost of product % is reasonable for your type of restaurant so just don't worry.