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Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

No tax on gift cards sold, this is from tax agency-

"No sales tax should be charged on gift certificates at the time the
gift certificate is sold.
Tax should be charged on items purchased
with a gift certificate. If an individual has a gift certificate valued
at $50, and purchases $55 worth of goods, sales tax is owed on the
$55. If the customer uses the $50 gift certificate to purchase $25
worth of goods and receives change, sales tax is owed on the $25
purchase."
Sales of gift certificates are included in gross sales on line one of the
sales tax return and deducted on line 3, Non-Taxable Sales.

i missed the step in step one, the payments on charge accounts i dont know how to enter that on sales receipt, if i need to make a new item for ar payments ? thats what is confusing me, my z tape shows cash plus ar payments and i have never entered ar payments anywhere, honestly my z tape confuses me more than anything when i try to make heads or tales of it... My total sales amount that i have been entering into sales receipts is net sales and does not include AR payments, I will go back and read through your explanations tonight after i close hopefully without distraction so i can concentrate, thank you for taking so much time and having do much patience with me on this i appreciate it more than you can imagine...

 

EDIT----- Light bulb just came on or at least is flickering a little, may have finally understood part of it but need to change and enter more stuff :smileyfrustrated:

I was entering the cash amount from media totals for sales and not the actual cash so it wasnt giving me a negative amount to counter with my positive payments on charge

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Yes, this is Part of the reason you have Funds: "i missed the step in step one, the payments on charge accounts i dont know how to enter that on sales receipt, if i need to make a new item for ar payments ? thats what is confusing me, my z tape shows cash plus ar payments and i have never entered ar payments anywhere,"

 

Example:

 

Only Unpaid Sales happened today. Entries:

Sales positive

"charged on account" = negative

No Payment Items to enter

Nothing over/short

= 0

 

Again, think through the activity Step by Step.

 

Later, you only get Paid for that Charged account amount:

no Sales

Positive entry for "charged account amount payment to us"

Negative for the actual Funds they paid, as cash or check or credit card Type payment

= 0

 

Did you read that Blog?

 

I have a sample, attached.

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

thank you again, yes i did read the blog it does not cover at all the problems i am having, my invoices do come out to zero just as your sample does but when i add the gift cards in and on account stuff then it still zeros out but nothing is going to the right place, i understand the flow of money and what the money does and where it goes physically, i just do not understand what quickbooks does with it if that makes sense..maybe it best if i post a screenshot of a problem invoice and ztape for a final attempt as i think my explanations are misleading you into thinking i dont understand the flow of money and what its doing when its not that at all... I will post screenshots...maybe it will help if not i will take it to the next step and let someone in my computer, im sure it is only one or two things i have either going into the wrong account or the wrong items set up in the item list...

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

1.PNG 1.jpg

Here is 1 example with a gift card sold and one redeemed, I know i do not have something entered right, the +cash sales/AR Payments total is 680.53 im guessing that was a small on account payment but am home now and dont have all the paperwork with me, gift cards sold and redeemed both point toward an other current liability account, as does sales tax. I will post another screenshot with on account charges and payments...

2.PNG

 

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

3.jpg 3.PNG This one has both on account charges and payments, but i dont know how to do the payments so none of daily sales receipts have it entered and until i started reading your posts i didnt have a payments item but both on account charges and payments in the item list point toward the same other current asset account...

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

"my invoices do come out to zero just as your sample does but when i add the gift cards in and on account stuff then it still zeros out but nothing is going to the right place"

 

You control this. Edit every item and see where you told it to flow the data. Open any Sales transaction, use Ctl Y, here are your debits and credits. It does what you Set up. It only does what you set up. There is no mystery. You did it. You can confirm it.

 

You stated it Wrong here, so that will confuse you: "the +cash sales"

 

Stop right there. It is just Sales. Not Cash Sales. Cash is the Payment method. Sales is the What Happened. Stop combining them in your thought process, to get clarity. This is where you go wrong.

 

Sales + AR payments = Cash and/or Checks and/or credit card.

 

Sales are not Cash Sales. They are Just Sales.

 

"This one has both on account charges and payments, but i dont know how to do the payments"

 

On your example, that "On Account Charge" that is Negative, needs to be linked to Other Current Asset. The money is already part of what you counted and see in the POS report: Cash and/or checks and/or credit card. Once again, do not confuse Money with the Why.

 

By the way, when I work with POS clients that allow Charge Accounts, we often find the Checkout person has posted the Payment against House Charges as More Sales. You show a Z out that seems to have only "unpaid sale put to house account as a Charge of $32.83" if I read that correctly. They all read Differently. Make sure you sample your QB Sales Receipt using one date with Paid on Account and one with Charged on Account, and one day with each type of activity. That's how you know you have it working. And the POS report doesn't even come out right, so that is an awful example, of course :) It shows there is a problem with how POS is being Rung Up. That is a huge amount to be over/short. You cannot use a Bad Example to set up QB.

 

"i didnt have a payments item"

 

Don't make one for AR. The Money is already in the Money section. The AR part is positive/negative for the Why = the Other Current Asset. That is Why people didn't pay today or why they paid money without this being part of Sales today. This is Never a payment Item. It is similar to Sales. Not Money.

 

"but both on account charges and payments in the item"

Error.

 

The Money is Already accounted for. Money is Just Money as various Payment Type activities. The "why" should have already been accounted for.

 

"list point toward the same other current asset account..."

 

That's Wrong. You are still confusing the Why and the Money. Go back and reread everything already covered. Get a piece of Paper. Write it out, step by step.

 

Let me try to give an example, making some assumptions:

 

Taxable Sales links to Income for positive

Taxes collected links to Liability for positive

(note 1) New Charge Account amount links to Other Current Asset, enter as negative

(note 1) Charge Account amounts received today; this is going to represent some of the money, but this is the Reason you got that money, and the Money is accounted for later; links to Other Current Asset, enter as Positive

 

Now list all Payment Items, they will be Negative: Cash, Checks, Credit Card

 

Now examine if you are over/short

 

Here is NOTE 1: Notice that these two Other Current Asset items will show the Net Change to House Charge account. They result in the difference between New Amounts Charged and Prior Amounts now Paid. Nothing here is Money. These two entries are the Why.

 

You don't just get Money. You get money Because of the WHY.

 

 

 

Level 2

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Sorry I forgot to mention that short amount on the z tape was from a cashed check, the till was right just shows short because an employee cashed a check and paid her bill, so checks were longvthe amount cash was short

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

"the till was right just shows short because an employee cashed a check and paid her bill, so checks were longvthe amount cash was short"

 

You should have had 0 difference, not Over/Short, though. You describe "making change" essentially. You overlooked something as Gross. Or, the Check being cashed got entered as a Check, but there is No Reason to enter this; it wasn't Sales.

 

If I take a 10 and leave you 2 x 5, that is Making Change.

Level 2

Re: Daily Sales Summary, how to enter on account charges for customers and employees

There is no way to make the pos come to zero with a cashed check, when I till out at night the entered checks are automatically entered and posted on the Z tape from checks throughout the day the only entries you can make when closing the shift are the cash and change count, when someone cashed a check without anything being rang up the amount of cash is short the amount of the check and it shows short on the z tape but the check amount is higher than the checks shown because there is no way to enter the check that was cashed... 

Level 7

Re: Daily Sales Summary, how to enter on account charges for customers and employees

When cashing a check for an employee, don't you just hit the equivalent of "No Sale" on you POS?  The Check line on your Z Tape is for Check SALES for the day, not just because there's a check in the Cash Drawer.  As @qbteachmt pointed out, you're just making change.

 

And even if the employee bought something at the same time, you would still not enter it in as a Check sale, unless the check = the sale and there was no change.  Once they hand over the check they need to get back that amount in cash.  So if at the same time you ring up a bill, they're paying you with that part of the money that's in the cash drawer and the balance from their check is Change.

 

Level 2

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Yes that is correct... 

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

"Sales + AR payments = Cash and/or Checks and/or credit card.

 

Sales are not Cash Sales. They are Just Sales."

 

In my explanation i was describing it exactly as it says on the z-tape (Cash Sales/AR Payments)

I know that it is combined sales but for the sake of trying to ask if thats what i enter on the daily sales receipt i stated it as it shows on the z tape in the picture because on my other daily sales receipts i entered the individual payments from sales which do not add up to the (cash sales/ar payments) on the z tape, I dont seem to know how to explain what I am trying to fix, I was hoping the picture of my daily sales receipt would point it out, anyway i think i have part of it figured out so i wanna thank you again for your time, I will try to get help remotely if i cant get it right this time...

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Thank you QBteachme and PeteMC for all the help and the amount of time you put into this for me, I have everything switched to the way qbteachme explained and everything is good except for 1 thing( I know you dont do it this way but I feel i need to match all money deposited in the physical bank to all money in quickbooks) not just explain it in quickbooks but actually match it to the bank feeds deposit, so all the money from employee charges and gift card purchases in the other current asset account(On Accounts) - entry for chrges + entry for payments and the other current liability account(Gift Cards) + entry for gift card sold, - entry for gift cards redeemed are explained in the accounts but I need to match it.... I had asked in a post a while back about gift cards and was given this explanation using gift card payment but you tell me not to do that so I'm still at a loss there...

 

 

I appreciate you checking in with us. I'm here to make sure your concern is addressed about recording gift cards into daily sales in QuickBooks Desktop.

When you accept a payment for a gift certificate, you accept the liability to redeem the gift certificate. In recording gift certificates, you'll need to create a Current Liability account, an Expense account and two Other Charge items

To create a Current Liability account, please follow these steps:

  1. From the Lists menu, select Chart of Accounts.
  2. In the Chart of Accounts, click on the Account drop down and choose New.
  3. In the Add New Account window, click on the Other Account Types drop down and select Other Current Liability.
  4. Click on Continue.
  5. Enter an account name.
  6. Click on Save & Close

To create an Expense account:

  1. From the Lists menu, select Chart of Accounts.
  2. In the Chart of Accounts, click on the Account drop down and choose New.
  3. In the Add New Account window, click on the Expense radio button to select and click on Continue.
  4. Enter an account name.
  5. Click on Save & Close

To create Other Charge item (this item will be used to record the gift certificates/gift cards sale/redemption): 

  1. From the Lists menu, select Item List.
  2. Click on the Item drop down and select New.
  3. From the Type drop-down, select Other Charge.
  4. Type in the name of the item. 
  5. From the Account drop-down, select the Other Current Liability account you just created.
  6. Leave the Amount or % field $0.00 and clear the Taxable field.
  7. Click on OK.

Then, let's create another item for donating gift certificates. This time, use an Expense account. Here's how:

  1. From the Lists menu, select Item List.
  2. Click on the Item drop down and select New.
  3. From the Type drop-down, select Other Charge.
  4. Type in the name of the item. 
  5. From the Account drop-down, select the Expense account you just created.
  6. Leave the Amount or % field $0.00 and clear the Taxable field.
  7. Click on OK.

Please know that when selling/donating gift certificates, you'll need to enter a sales receipt/invoice with a positive amount. When redeeming, you'll need to enter a sales receipt/invoice with a normal sales item and a subtotal item with a negative amount.

 

When you sell a gift certificate, the sale is recorded as a liability. The income amount will not show in your income account until the gift certificate is redeemed.

To sell: 

  1. Create an invoice.
  2. On the first line, enter the Gift Cert other charge item with the amount for which the gift certificate was purchased. This increases the Gift Certificates other current liability account by the amount of the gift certificate.
  3. On the second line, use the Gift Cert Pmt payment item to show the amount you received in payment for the gift certificate. This increases your bank account when you make your deposit. Accounts receivable is not affected.
  4. Track the gift certificate number in the invoice's Description field. Note: The balance of the invoice should be zero.
  5. Click on Save & Close once you're done.

When the gift certificate is redeemed:

  1. Create an invoice.
  2. Use the appropriate sales items with a positive amount to record what the customer purchased with the gift certificate.
  3. Use the Gift Cert other charge item with a negative amount for the amount of the gift certificate, but not more than the amount of the sale plus any applicable sales tax.

    • If the amount of the sale was more than the amount of the gift certificate
    , the customer may pay the balance.
    • If the amount of the sale was less than the amount of the gift certificate, QuickBooks will continue to reflect the remaining amount in the Gift Certificates liability account. You may want to issue a new gift certificate to the customer outside of QuickBooks to help track the remaining balance.

  4. Click on Save & Close.

That'll do it. From there, this answer will guide you through the steps in recording gift certificates.

As always, you can reach out to me if you have further questions about recording gift certificates in QuickBooks. I'll be around to help. Have a great day.

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

You typed a copy of the reply from an Intuit person regarding gift cards.

 

Only you know if that is Liability when you sell it, or income when you sell it.

 

Here's how to include it in the Sales Summary:

Selling it brings in more Funds (cash or check or credit card charge) so there is Nothing New to do for that Funding side. What you do is List the Gift Card as a Sold item, separately from Food or Beverage or whatever you typically list as Sales Items, and control if that is Taxable or not.

 

So, a Dated Sales Summary might be this:

$400 regular sales

$100 Gift card sold

= $500 taken in today of new Funds

 

The Redemption of the gift card against the sale is the same as a Payment, and we have reviewed that Payments as Funds (or gift card redemption = in lieu of New Funds) are negative entries.

 

So, let's show this next date:

$400 regular sales

negative $100 for Gift Card Redeemed today

= $300 taken in today of new Funds

 

You should be able to use that same Gift Card Item for both activities, but make the Description in the line for Redemption include "Redeemed, use negative" and I like to list the Gift Cards "redemption" down in the Payment Items section. I list the Sale in the top, the Detail your Sales Here, section. Or, make two items that both link to the same account (liability, if that is what it is for you; or Income, if that is what it is for you). Now name one of the them GC Sold and one GC Redeemed.

 

For Liability, the positive on sales Increases your liability and the Negative redemption decreases the liability for open Gift Cards. If you are not allowed to carry this as Liability (which is why you cannot just do what you see on the internet, which is not your specific and personal answer), if this is linked to income, then the sale is income and the redemption looks like a Discount, because effectively, you already got the money as income previously, and the redemption is proof they don't need to pay in full for this sale.

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Yes this is exactly how I am doing it now but it is not doing what i need it to do which is post somewhere such as undeposited funds to match to my bank feed, I stated I have everything set up the way you explained and its working except what i explained above, it is tracking gift cards fine and listing them in income account when redeemed but thats NOT my problem, I am  refering to this section specifically number 3 of the post i copied and pasted from another post:

 

When you sell a gift certificate, the sale is recorded as a liability. The income amount will not show in your income account until the gift certificate is redeemed.

To sell: 

  1. Create an invoice.
  2. On the first line, enter the Gift Cert other charge item with the amount for which the gift certificate was purchased. This increases the Gift Certificates other current liability account by the amount of the gift certificate.
  3. On the second line, use the Gift Cert Pmt payment item to show the amount you received in payment for the gift certificate. This increases your bank account when you make your deposit. Accounts receivable is not affected.
  4. Track the gift certificate number in the invoice's Description field. Note: The balance of the invoice should be zero.
  5. Click on Save & Close once you're done

 

This is how I was told to do it previously and when i do it that way it posts the gift card purchased money to both liaility account and undeposited funds but not income account so i can then match it to my deposit from my bank feed download which is what I want, but you tell me not to use gift card payment so i am trying to figure out if i was told wrong if this is incorrect way to do it ? If it is correct and since it is working will this method also work with employee on account charge payments ?

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

You just confused Money and reasons, again:

"but it is not doing what i need it to do which is post somewhere such as undeposited funds to match to my bank feed"

 

You need to reread everything. let's review a Basic example:

ordinary Sales $400 <== income

Gift Card Sales $100 <== income or liablity

 

Whatever else happens.

 

Then, Payments methods as Cash and Checks and Credit Card Charges. Nothing here is Gift Cards. You already Accounted for how their Activity affects you, and now all you do is Count and manage Funds. Stop confusing Funds with the Reason funds are happening.

 

Example:

$500 sales

$100 Gift Card Sales

$50 Gift Card Redeemed as negative

 

Done with entering The reason or My Business Activities.

Means you should have new Money as $550. Now you account for the Various Types of Money. This is the point that matches to Banking. Not Gift Card activity, just the Money parts.

 

This seems like an error: "and listing them in income account when redeemed"

 

Let's review:

 

Are you able to keep Gift Card sales as Liability, to "be spent later?" If so, then here is the example:

Sales of Hats <== Income.

Apply a Gift Card <== Reduces the Liability and now the customer owes Less

Paid the difference <== Real Money, as Cash or Check or Credit Card Charge

 

GC is Not Income. It is in lieu of Money, when redeemed.

 

Or, you are not allowed to hold GC as liability. Here is the Different example:

 

Sales of Hats <== income

Redemeed GC <== negative to income, looks like a Discount given

Paid the difference <== Real Money, as Cash or Check or Credit Card Charge

 

GC is Not Income. It is in lieu of Money, when redeemed. In this example, you essentially made then Forfeit the card to prove they didn't need to Pay in Full.

 

This doesn't make it Right: "I am  refering to this section specifically number 3 of the post i copied and pasted from another post:"

That topic, here:

https://community.intuit.com/questions/1777950-looking-for-help-on-how-to-enter-gift-cards-into-dail...

 

Is Wrong. Don't confuse the topics that reply to specific questions, and might be giving different answers. IntuitJane has it Wrong, because that topic is not Framed from the perspective of Sales Summary. And you never put a Payment Item on an invoice or sales receipt, when it is part of everyday activity, anyway. You don't Separate out only Payments from Gift Card Sales; that isn't what happened in reality. In reality, All activity results in funds of various types waiting to be in banking as part of Settlement from cash, checks and credit card charges. There should never be the guidance of making the Payment Entry on its own, like that example.

 

"This is how I was told to do it previously and when i do it that way it posts the gift card purchased money to both liaility account and undeposited funds "

 

Your Sales Summary already providing for Funds of various types to UF for Banking settlement. You don't use a Payment Item for GC. You use Payments items for Funds entries.

 

"so i am trying to figure out if i was told wrong"

That IntuitJane Answer is wrong. First, if this is individual Sales receipt, you sell me a gift card and the Sales Receipt flows to UF, already. Or, it is one of many things on my invoice, and I give you payment, which you process as payment. Third, it's wrong for Summarized Sales. It's from a person who does not use QB routinely, and often they have Accounting Concepts wrong and their methodology is weird. And in this case, Wrong for you.

 

"will this method also work with employee on account charge payments ?"

 

 

Once again, break it out like this:

 

Either you want Summary data or By Names. If you want By Names, you use the regular functions, such as individual Invoices.

If you want it as part of Summary, we already covered House Charge Accounts.

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

"This seems like an error: "and listing them in income account when redeemed""

 

sorry i worded this wrong, it doesnt list it in income when redeemed it accounts for it in the total sales when redeemed....

 

 

I will enter more receipts tonight, i understand what you are saying so i will start going back to previous months and changing my entries... I think i still need to change my over/short account to an income account as i was told before to use an expense account, i am a little confused as to how to match that to my deposits as well as deposits are long the over and short the short but i havnt thought about or looked at that part much yet so one step at a time, you may have explained that to i will go back and look as I have a lot going on right now and tons of stress so thinking is almost impossible for me right now... I have lost 6 family members in 5 months on top of getting this bookwork thrown on me from one of the deaths I also have to manage the restaurant and cook full time 7 days a week on top of running a separate part time business(hence the xarget and KAOS user names, sometimes i use the wrong account to post and dont notice) so things are not sinking in like they should be....

Level 3

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Ok disregard the last post from me, I now have everything switched over to the way you explained it and i finally understand it all as everything is coming out and going to the right places, I now have a few days worth of changing information in my sales receipts and 8 months worth of sales tax to amend.... I cant thank you enough qbteachme for having the patience to stick with helping me and correcting me :smileyhappy:

Level 15

Re: Daily Sales Summary, how to enter on account charges for customers and employees

Yay! Glad to help.

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