What would you do if you saw an employee take 10$ from the register?

Just to add, the above 'Giving 2 options' has worked for me 2 times already without any hassle. Though it was not for stealing, it was for underachieving and blatantly not doing their work.

Different circumstances would differ how I handle it but Personally, I would take them to my office, whilst noting if I had CCTV footage on it too, and give them a straight choice. I would explain that they had 2 choices in the matter. 1st option: That this has to be investigated as I saw them take money. Because I saw them take the money so its quite obvious, it would likely end in a dismissal for gross misconduct and the police would have to be informed if it were proved they stole money. 2nd option: I would accept their immediate resignation if they so wished.

Tell management