Can you please advise, we have an external company who is dealing with our daily cash ( collecting cash of daily sales ) + does payroll on daily basis.
Once a week they issue remittance advice as follow:
So, I have to create a sales invoice of 3000.00 ( however we wont see the real sales i.e. 5000.00 ), purchase invoice of 1000.00( commission ) and have to post cost of Payroll ..
I'm not too sure how i should allocate payment of the purchase invoice & payroll as it has been deducted already by them...?
Can someonehelp please?
Thanks
Anna
Ps. I have attached the RA.
-- Edited by Anna12 on Sunday 5th of June 2011 12:52:58 PM
Is your client vat registered (looks like it should be)
The payroll figure that you quoted, I assume is the net pay to employees. Are you being supplied with the rest of the payroll info you'll need?
One thing I would point out, is your sales turnover certainly isn't £3,000 and your instinct that it should be £5,000 is more like it (depending on your answer to the vat question).
I've not read the RA, but in principal, you'll need to record:
Total Sales
Less Total expenses / deductions (as appropriate).
This will then equal cash received, which in itself isn't sales income.
-- Edited by ADAS on Sunday 5th of June 2011 02:01:21 PM
__________________
Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
Thats right, I have to post the total sails. I have attached pdf file if you could have a look on it? You will see there:
Total gross sale ( will issue an sale invoice net + vat for our records ) Their Commission ( enter purchase invoice net +Vat ) Bank charges will post directly to bank account in sage Payroll I think will post it directly to nominal account Other charges- will post also directly to nominal account
The thing Im not too sure is: if the total sales is e.g. 5000.00 all deduction e.g. 2000.00 so, there still will be shown balance of 2000.00 which I have posted directly to nominal accounts as stated above. Should I issue a credit note or there is other method in sage to bring the balance to 0.00??
I wonder also of the bank rec because there will be stated the total amount after all deductions?
All your missing is a control account. Personally, I would open a "dummy" bank account for this supplier and that'll solve your bank rec concern. Once you've posted all the income and costs correctly, the balance you're left with I would transfer from the dummy bank account to the actual current account. This will equal the physical cash you receive.
You can then reconcile the dummy account each period back to nil.
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Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
Yes, the 3000.00 I have received from my client and posted into their account, however the total sales was 5000.00. So, as you have mentioned above the balance of 2000.00 will transfer for the dummy b/a. I have to do the same with Payroll, purchase invoice ( their commission ) and other charges on the very and balance of the dummy b/a will be e.g. 4500.00 and I have bring it to 0.00 end of each month. Do you think if that is correct? Thanks anna
There is actually one thing Im wondering at, after these all transaction you have stated above Im still going to have a balance on sale invoice of the 2000.00 as it was posted into purchase invoice and payroll ( deductions ). What should I do with it? Anna
The 5k what they collected from you is your sales, isn't it? So when you process your sales process it to your dummy a/c- now you have the 5k there. From there you pay the above and the left over goes to your bank. The company is collecting your daily cash sales but it is still your money! - your income from sales. It is not a new sales invoice...
As Attila replied about you post a receipt of £5000 from the dummy bank account. Technically the company collecting has paid you £5000, they've just taken the £2000 owed to them at the same time.
Maybe think of it this way. Your friend owes you £20 but you over her £15, so she just gives you the £5 difference.
Hi Attila, Anna mentioned raising the invoice in her first post, so I though it better to stick with the method she was used.
-- Edited by ADAS on Tuesday 7th of June 2011 09:29:51 PM
__________________
Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
The total sales ise.g. 5000.00 ( including VAT ) - I have to create weekly sales invoice for our records
Commission e.g. 800.00 + 200Vat - Will issue purchase invoice
Payroll 1000.00 will transfer directly to Nominal Account from the dummy b/a
Will transfer in the Dummy b/a 5000.00
Pay the purchase invoice 800.00 +200.00
Pay the Payroll 1000.00
Total paid2000.00 and 3000.00 of balance left
Now I have to pay the sale invoice of 5000.00 however only 3000.00 left in the dummy b/account so, there will be 2000.00 to be paid yet. Im not too sure how can I bring it to 0.00 balance.
Anna. The £3,000 balance left in then transferred to current Account,
HI Anna
The £5000 must be done as a Sales Ledger Receipt, I think this is where you've been getting confused. You're correct above but the last stage is to transfer the £3000 to the business current account.
This should be the same as the remittance the collecting company sends you and will match what the physically paid into the account
-- Edited by ADAS on Wednesday 8th of June 2011 08:40:58 PM
__________________
Tony
Responses are intended as outline only. Formal advice should be sort from your Institutes Technical Department or a suitably qualified Accountant.
Uff, finally I know how to do it ))) Tomorrow will try to do the sales ledger receipt in Sage and rest of the transactions... Thank you very much for your help!!! Regards, Anna
