Recording on the cheap side (under $100)

Here's the cheapest way to record anything. This can cost as little as $100 if all you need is a USB interface (assuming you own a microphone, a computer and some headphonse already).

What you need:

1. Well first off you'll need a computer. Any computer will do just about. Just be sure you have about a 1 GB of space on your hard drive and I would recommend about 1 GB of RAM (minimum 512 MB).
2. Now you'll need recording software. There an excellent free one called Audacity. Very easy to use and there's plenty of documentation to help you out.
3. Are you software-ready yet? Now it's time to get the hardware. If you don't have a microphone, you'll need one. If you want technicality, I'd recommend a condensor microphone with a large diaphragm.
4. To connect the microphone to a computer you'll need a USB interface like M-Audio Fast Track. This may be the only the thing you need to buy. Your microphone will connect to the USB interface, and your interface to the computer. When you're done with this, open up audacity and test the microphone and see if it works.
5. It's time to record! Now there's 2 ways of doing this. You can do a click track and record each instrument seperately on seperate tracks. Or here's another method (my way)...

Pro-recording with one input:

1. Recording all the instruments is pretty easy, except the drums! I would recommend recording everyone (except the singer unless it's absolutely necessary) at the same time. If you have a drummer, you will need to concentrate the sound around them. Check out this video and read the description on how to perform this.
2. Put all the other amps around the microphone so you get an equal sound.
3. Now it's time to improve the quality. Isolate the drummer from everyone else and give them some head phones (studio headphones are recommended). Connect the headphones to the USB interface. Record a new track without deleting the one the whole band made, and have the drummer overdub (record on top of) it.
4. Once the drums are completed, isolate the guitarist in the same fashion and have them overdub the same way the drummer did, this time including the drum tracks. I'd recommend lowering the volume of the full band and raising the volume of the drum tracks.
5. Repeat step 4 for each member of the entire band until you're done.
6. Go ahead and delete the first track with the full band (and click track if you used it) and you're complete with recording! I'd also recommend using this time to work on equalization and fixing the sound levels.
7. Be sure to let everyone sit on it over night before completing it. What I mean by this is export the song file as an mp3 and either burn it to a CD or send it via e-mail to each member. Let every member listen to it a few times that night to see if they want to fix, add, change or delete something. The next time everyone gets together, you can make any necessary changes before marking the song as complete.

Some more tips:

• Audacity will probably record in Mono only. To convert this to stereo, follow this guide at eHow.com.
• Microphones with a large frequency range are usually the best to record with.
• This is a long process. If something doesn't sound perfect, keep doing it until it is.
• Noise cancellation studio headphones are the best headphones for studio work.
• Snare drums have a tendancy to vibrate a lot. Use moon gel to prevent this. If you can't afford a pack of moon gels, just make a little box with duct tape and tape it to the top of the snare. Do the same with the toms if they're causing vibration problems too.
• When you're recording, be sure to not go beyond the boundries. While recording, you will see waves on the track you're recording that show up verticle in Audacity. If these waves reach the top or the bottom of the track, then you're recording too loud and the quality will be horrible.
• Don't put the microphone right in front of the speakers when you're recording the guitars. Leave about 4 inches of distance. They will sound too muddy otherwise.
• You do not need to spend hundreds to get a program like Pro Tools or Sony Acid to get good quality. These programs only allow more mixing and after-effect processing options compared to Audacity.
• If you want to submit this as a demo, you may want to take it to some professional to master it. This should only cost $50 at max and they'll make sure all volume, bass, treble, etc. levels are similar.