I am not a qualified accountant but can do basic book keeping. I am new to OBO. I have the following query and I am hoping you can help as I have googled lots!
My partner runs a takeaway and uses Just Eat to fulfil orders. Each week we receive an invoice from Just Eat. I have set up Just Eat as a Customer and in the Chart of Accounts I have set up Just Eat as an Income Account (sub account under Sales), Just Eat Fees as an Expense account
The invoice has the following items: Total Sales, Card Sales, Cash Sales, Commission. Each week the Cash Sales, Commission are deducted from the invoice (as our driver collects the cash) and the remaining is then deposited into my Bank Account. VAT is charged on Commission.
I am struggling as to how to add this into QBO. This is what I did:
1. I set up the following products:
- Card Sales
- Cash Sales
- Commission
2. I then create a Sales Receipt where I add all three products above and I place a -ve amount +VAT for the Commission
I have the following issue, this amount doesn't match the amount that is deposited in the bank (because it includes the Cash Sales).
How do I account for the cash sales that are in the Cash Register. I have created a Cash Register Bank Account, but it seems like the Sales Receipt only lets me direct these products to ONE bank account.
Also we are not VAT registered at the moment (as we are new and below the threshold) so for income should I put "No VAT" or "Zero VAT" and tick 'amounts are exclusive of Tax' on the overal receipt. But then how do I mark the Commissions which do have VAT.
I was hoping I could do this all in one transaction, but it seems like I will have to create separate ones - especially for the cash?
I'm not familiar with QB (just taken on a new client who is using it, so I'm likely to get acquainted soon) but the accounting entries should be as follows.
When doing the JE invoices don't record the cash, just the card sales. Record your daily cash takings into the cash account as you get them. Total commission including VAT can be recorded on the expense, VAT doesn't need a separate entry until you are VAT registered. That should simplify it hopefully, and it should balance.
I would also suggest looking to take on an external accountant at the start of your business, rather than when the accounts are due. It gives you a chance to get to know each other and is on hand for tax advice. Most accountants will let you pay monthly towards the first years fees so it's not a sudden hit at the end.
__________________
John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Hi Reena,
You might find the 'Undeposited Funds' option on QBO useful to record the daily Sales by card and cash.
Then you can use the 'Find Match' when the payment shows up in your bank. The commission fees can then be added at this point.
Hope this helps.
