We use petro cards for fuel. The amount is transferred from the bank to the Petro Card which is also treated as a bank. Whenever we fill fuel, we pay from the Petro Card Bank. Whenever we fill fuel we get a cash back also. How do i record it.
1. Transfer Money from Bank to Petro Card (Bank) 200
2. Fuel Expense = 100
3. Cash Back = 10
4. Petro Card Balance = 110
If i create a new income account won't it come under taxable thing. How do i record it so that my Petro Card Bank balance shows the actual amount in my PetroCard.
Just like you have distribution account for expenses, you also have distribution account for cash back item which is normally categorized as business income. So accounting $10 as Cash Back Income will add to your Fuel Card account. In your Petro Fuel Debit Bank account with the following three transactions, you should have $110 ending balance. ($200 transfer payment - $100 expense + $10 income = $110 balance).
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