Entering orders and payments

feaco11's Avatar

feaco11

13 Feb, 2017 07:20 PM

I am just beginning to enter orders in Easy Books . I am using the latest version o Easy Books for the Mac.

I have created a customer and I have entered the order number, the customer name, the order amount and the price into the sales journal. the transaction type as order and the account 2 as Sale of Goods. Is this correct.

Now I have received payment for the order. As an example let's say the order was $100.00 There is a 2.00 credit card processing fee deducted from the order. The order was taxable so I received a net of $103.00. I do not know how or where to put the deduction of $2.00 and where to put the $5.00 sales tax. It needs to be in a sales tax account until I send it to the state> I have not seen an example of this type transaction.

Can you give me some guidance.

  1. Support Staff 1 Posted by Mathew on 14 Feb, 2017 09:29 AM

    Mathew's Avatar

    Let's start with the original sale. You should add the tax at this point. To make sure you can, first check in the Business Settings to make sure you've turned on GST. You can also set the default percentage rates there too. And if you need to create more tax accounts, you can do that by adding a new account in that category (Tax rate on sale and Tax rate on purchase).

    With that done, you should enter the sale as you are doing, but choose the appropriate tax account as well.

    Your example would then be:
    Sale $100 + tax $3 = $103 (to pay)

    When you receive payment, you're not getting the whole amount because of a $2 deduction from your payment company PayPal. This $2 is an expense which I would argue is a cost of gaining that particular sale, so it goes in your "Cost of Sales" expense account. This is a "direct" expense - look into "Indirect" expenses yourself to find out the difference. Essentially the indirect expenses are there whatever happens - lighting, heating etc. Direct expenses are incurred when you make a sale - PayPal fees, delivery costs etc.

    To enter the payment, find the original sale. I'll tell you how to handle it for the Mac app, you can probably figure out the iOS app yourself, it's the same process.

    1. Right-click on the sale and add a payment using Payments > Receive Payment.
    2. Set the date you received the payment.
    3. Choose your PayPal account for Account 2 (which should be already set up as a Bank Account).
    4. Add a split.
    5. In Split 2, change the account to "Cost of sales". Then for the amount, set the value $2. As you do, you should notice the amount in Split 1 decreases from $103 to $101. If it doesn't, or if you receive just a partial payment, you can set these amounts separately.

    Split 1 represents the money you receive into your bank account. Split 2 accounts for the expense amount.

    I hope that helps,

    Mathew

  2. 2 Posted by feaco11 on 15 Feb, 2017 02:02 AM

    feaco11's Avatar

    Thank you. It works just right and I now have a better understanding of what I am doing.

  3. Support Staff 3 Posted by Mathew on 19 Feb, 2017 01:39 PM

    Mathew's Avatar

    Would you mind if I opened this discussion up to being viewed by the public? This would probably help other people too and I can't see any personal information that would cause an issue.

    Mathew

  4. 4 Posted by feaco11 on 19 Feb, 2017 01:49 PM

    feaco11's Avatar

    That would be fine with me. Being a business owner and not an accountant, your answer was tremendously helpful. Go for it!

    Thanks again

    Frank

    Sent from my iPad

  5. Mathew closed this discussion on 19 Feb, 2017 07:27 PM.

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