This comment was split from the discussion: Supporting U.S. Tax
Can easy books support both cash basis accounting and accrual basis accounting? I didn't see any thing. Which format does it use?
Also, as a feature of the Mac version, could it serve as a
server for multiple devices to sync to? Thanks for all of the hard
work.
Erik Bjur
#1 Posted by Admin Support staff on 06 Apr, 2011 03:10 PM
The accounting method depends on whether you create customer accounts or not. If you want to use cash based accounting, but you still want to use customer accounts then there is a little more work to do at the year end. The app is based on the accrual method, so any sales you make incur tax on the date of the sale. At the moment the app does not adjust the overall P&L for cash based accounting, but it does for VAT/GST.
If you use customer accounts, and you raise sales invoices then the app is using accrual accounting. This is for the purposes of VAT (or GST in your case!). For profit and loss, you would need to adjust the overall profit figure by the outstanding balances of your customer and supplier accounts. Just take the total amount owed by your customers on the year end and reduce your profit by that figure. Likewise, increase your profit figure by the amount owed to your suppliers. These balances are shown if you tap on "Customers" or "Suppliers".
I will add the option to file the P&L using cash based accounting soon!
Mathew
Admin closed this discussion on 06 Apr, 2011 03:10 PM.
Erik Bjur re-opened this discussion on 06 Apr, 2011 03:22 PM
#2 Posted by Erik Bjur on 06 Apr, 2011 03:22 PM
Thanks. Thats awesome.
Erik
Admin closed this discussion on 06 Apr, 2011 05:20 PM.