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Post Info TOPIC: How to post goods sold for someone else
crlrsheff


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How to post goods sold for someone else
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I have a client who is going to sell goods for someone else, on a commission basis.  He will invoice the buyer and when he receives payment he will send payment to the seller less his commission.

Could someone advice me on which nominals accounts would be needed for these transactions.

-- Edited by crlrsheff on Wednesday 24th of November 2010 01:25:40 PM

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C Rickett
moxby


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The nominal codes are your choice. Important points are:-

1. The stock is not his in no way at all. Therefore do not recognise this stock in any way.
2. The full sale is not his income - only the commission receivable. Therefore you have:-

a. Cr Sales - Commission
b. Dr Debtors - Invoice Value
c. Cr Creditors with the net value - this money belongs to the other person

3. When the cash comes in:
a. Dr Bank - full amount
b. Cr Debtors - full amount

4. When the payment is made
b. Dr Creditor & Cr Bank

Hope this is okay - this is my gut feeling.

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Martin Oxby ACA
Nene Business Services Limited
Peterborough Bookkeepers|VAT Consultancy
crlrsheff


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Thank you for your reply Martin, that is very helpful

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C Rickett
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