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Clarification - recording services donated...

I read the Help article titled: "Record donations or charitable contributions" . (i originally posted my question with the link, but it was then marked as Spam, so I am trying this question again without the link).

I had some clarification questions....

The process works great; however, I am having an issue with the donation value showing on the P&L. When I go to check the P&L to make sure I see the donation value on the report - the Charitable/Donation COA has a zero balance after entering the donated service (in my case the client I have donated a service that equated to $250.00).

When I drill down in the Charitable/Donations COA, II see the original invoice that I created of $250 and the credit memo to the customer for the same value of $250 in the Charitable/Donations COA - this creating the zero balance.  

How can I tweak this process to make sure the donation value shows on the P&L report?

Thank you.

 

6 Comments
Established Community Backer ***

Re: Clarification - recording services donated...

For this I create two "Other Primary Income" accounts, one for "Donated Services" and one for "Donated Services Discount". Then I create two Service Items to match that are mapped to each of these two income accounts. These are the two service items I choose when creating the invoice. One line item for the value of the donated service (debit) and a second line item for the discount amount of the donated service (credit), the invoice total is then zero. But I can see both line items on my P&L Report, a negative and a positive right next to each other in my Income section.

Established Community Backer ***

Re: Clarification - recording services donated...

 
Established Community Backer ***

Re: Clarification - recording services donated...


@Oak1 wrote:

When I drill down in the Charitable/Donations COA, II see the original invoice that I created of $250 and the credit memo to the customer for the same value of $250 in the Charitable/Donations COA - this creating the zero balance.  

How can I tweak this process to make sure the donation value shows on the P&L report?

Thank you.

 


It is showing on the P&L, but because you posted both the income and the write off to the same account it results in a zero balance as it should.  You can not show donation income on the P&L without also showing donation write off.

 

@Regina_Lend_A_Hand_Accounting


I use your method too, and I like it better than the CM method. but in your explanation you forgot to tell the OP that the discount item you use, "Donated Services Discount" must be entered on the invoice as a negative number, or the qty for that item must be set to negative one.

All items used on an invoice or sales receipt, regardless of the type of account they post to, post a credit if the total value for that item is positive.

 

Established Community Backer ***

Re: Clarification - recording services donated...

I specified debit and credit, then later referenced negative and positive, I believe that was sufficient.

Established Community Backer ***

Re: Clarification - recording services donated...

If this is a charitable organization, and in the US, you get a donation of a professional service, this is Donation In Kind. You need to See income value. But the donation is the same as "I got the money and used it to buy this service or item." This is a Barter function.

 

Example:

 

Make a bank account and name it barter. A vet donates $250 of time to the animal shelter to do general pet checkups. This is the Animal Shelter's Donation not of funds but of Professional Services to be reported as Donation In Kind Income. Put this on a donation form (sales receipt) and Deposit to Barter Bank. Now Spend the money from that bank to pay for Vet's Service as your professional expense category.

 

Or, you donated the service = you send them the invoice and you also write it off, because only a C Corp gets to take a donation expense (Excluding the giving of food).

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Re: Clarification - recording services donated... I have a similar situation - why would I want to record income for the donated services? I really just want to reflect the expense - which maybe should be offset in the equity account?

 

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