Hello all, and thank you for taking the time to try and help me sort this out. I use quickbooks desktop for mac in order to record daily sales from a POS cash register. I don't invoice each sale, but instead use a memorized recurring sales transaction that I then enter the daily totals in. I don't use undeposited funds. I record cash and credit transactions directly to the bank accounts they are associated with and make daily deposits. The credit card processor I normally use deposits the total amount I have collected for each transaction and then takes their cut back at the end of the cycle, I deduct the total they took from the bank account as a fee and it all just works. However, the latest update to my POS broke credit card processing for us and it's not likely to be fixed anytime soon we picked up a square reader to use as a work around and to have on hand should something like this ever happen again. Since Square takes it's cut before the deposit, what do I need to add to my memorized transaction so that I can record the amount Square deposits into my account and keep track of the service fees? My initial thought was to add a "Square Fee" item to the transaction as a (fictional) bank account, record the actual amount Square will deposit into my account in the "Credit" item and then record the fee as a negative amount in the "Square Fee" item. While this would work to balance my daily transaction sheet to zero, I would also end up with a "bank account" that would only ever have negative transactions occurring in it. I'm not sure that would matter much since it's a fictional account but at this point I've been thinking about it to much and have confused myself. Any advice is appreciated.
The Square fee item is an expense and you add the item as that, not as any fictional bank account. So, if you are going to refuse to use undeposited funds for the sales receipts with a single daily deposit (deducting the square fee as a negative expense on the deposit as I do and recommend) then enter the Square fee INCLUDING the 25 cents per transaction on top of the percent to be more accurate. Keep in mind that Square will batch deposit multiple daily transactions in one deposit deducting all the appropriate fees and using Undeposited Funds makes keeping accurate track of this much easier as you can view your deposits in your Square online account
Thank you for taking the time to help out. I’m not necessarily refusing to use undeposited funds it’s just that I’m not currently set up that way and since I’ll eventually be back to normal I was hoping to not have to change to much and still be able to accurately reflect what transpired with the money. I think I have a solution that’s much cleaner than my initial thought. Let me run this by you.
What if I create an item “Square processing fee” linked to a new payment account on my transaction sheet. I can then record the actual square deposit to me into the correct bank account and record the square fee to the new account in order to balance my transaction sheet. Then I make a payment to Square out of the account linked to the “Square processing fee” item to record that the money is no longer in our possession but was paid to square as an expense. That seems to me like it would accurately show the money flow and not change my workflow to much. What do you think? Thank you, Scott