I have a new client - Public House, so there is daily cash takings to enter. Do I post these to the bank account as cash sales. and also how do i handle the vat, are they able to claim the vat back from the cash sales??
Very important for a pub that you balance the cash. I would guess not all sales are paid into the bank. You would only post the actual bankings to the bank account.
Re VAT - from memory, think it's all standard rated, so the output VAT would be 1/6th of sales.
NB you put "are they able to claim the VAT back from the cash sales" - not sure what you mean by this.
Thanks , So only post what is actually on the paying in slip. So does the rest go to the Petty cash account ?
Sorry i have confused myself there!! For the sales say for instant their weekly takings are £8170.55 all cash from drinks do i deduct 20% of that amount for the VAT ?
The VAT included in the sales figure is £8,170.55 x 1/6 = £1,361.76, not 20% of that amount, as the sales are inclusive of VAT.
If they only banked, say, £4,000, then they must have £4,170.55 left in cash, used to pay suppliers, wages, drawings, etc... So yes it would go to the cash account. As I mentioned before, it is important that the cash is balanced and reconciled regularly.
What I would do is the total from the tills (less the float) should go to the cash account as Sales and have the VAT extracted. The difference between what was paid into the bank should be accounted for by receipts for items paid out (could be wages, could be stamps, could be various purchases for resale) which would be posted to the relevant nominal codes and the difference should be the float.
