Struggling with vendor payments
beth at oasis.slimy.com
Thu Aug 4 01:25:04 EDT 2005
On Wed, Aug 03, 2005 at 10:40:41PM +1000, Andrew Greig wrote:
> Maf. King wrote:
> >On Tuesday 26 Jul 2005 12:28, Andrew Greig wrote:
> >>Initially I entered each of my parking receipts as a separate 'invoice",
> >>but I found the process of always having to "search" for the same vendor
> >>was tedious, so now I have lumped them all into one invoice with docket
> >>numbers on the different dates, and I "pay" them at the end of the month
> >>out of petty cash, whereas in fact I put the money in the meter on each
> >>particular day.
> >Following your example of parking charges, I would record those as a
> >direct expense from petty cash. That way, you will get tab-completion in
> >the register window. If your parking charge is the same day-to-day, then
> >you will save loads of typing! GST is done as a split - you will have to
> >calculate that manually, if it not shown on your parking receipt.
> Hi Maf, et al
> I have unposted and deleted all of the expenses which should have been
> entered through petty cash as you suggested. But now I can find no
> reference in the help file regarding use of petty cash. Could you
> explain your process to me please? IANAA either.
Let's assume you need to pay $10.00 for parking.
Example 1: You pay it from your business's Petty Cash account, and
there is no tax involved to keep track of.
Open the Expenses:Auto:Parking account. If you enter the expense
on the day you parked, the date will already be correct, otherwise
you can adjust it. Tab over to description, type "Main Street
Parking Lot" or similar description. Tab to the transfer account
and select Assets:Current Assets:Petty Cash. In the expense column,
(the left one for debits) enter 10.00. Hit enter to record the
Example 2: You pay it from your own personal wallet, and reimburse
yourself once a month. (no taxes involved).
Open the Expenses:Auto:Parking account. After a date and
description, select the transfer account "Equity:Draw"
Once a month, write yourself a check for the total of
the parking receipts in the Equity:Draw account -- the
transfer is between Assets:Checking and Equity:Draw, and
should bring the Equity:Draw account balance back to zero.
According to my accountant (I am not an accountant.) the
Equity:Draw account should be set up as an equity type
account for all transactions that cross the business/personal
money barrier. So if you pay for a business expense out
of personal money, the transfer account is Equity:Draw on
your business side of things. If you use the business
checkbook to buy a birthday present for your spouse, the
money flows the other way in the Equity:Draw account.
Your accountant can help you get the accounts set up if
you have more complex transactions (like paying yourself
Example 3: You pay for it from your business Petty Cash, and
need to track how much was for "Parking" and how much was
the associated taxes -- say 8% tax rate. (I'll call it GST
in this example, but being from the US, I don't actually
know what that means.)
Open the Assets:Petty Cash account. Enter the description.
Skip the transfer account for now. In the Spend column
(also called Credit if you have accounting labels turned on) enter
10.00. Now hit the split button on the toolbar. It should
show Assets:Petty Cash on one line, next to the 10.00 spend (aka
credit). In my setup, which I believe has default colors, it's
sortof a tan color. Click on the tan blank line below it.
If you accidently hit enter, it will ask you how you want
to adjust your split, click cancel.
Enter "parking" in the memo (or leave blank). The account is
Expenses:Auto:Parking. The amount we need to calculate --
either you can read it from your receipt, or you can do
some math in gnucash. We said the total charge was $10.00,
which included 8% tax on top of the real fee. If X is
the base parking fee, 10.00 is 8% more than X, or 10.00 is
1.08 times X. So X = 10.00/1.08. Enter "10.00/1.08" without
the quotes in the receive/debit column (a 10.00 should be
pre-filled there for you.) Gnucash does the math and comes
up with 9.26.
Gnucash also does the subtraction for you and lets you know
that you still have .74 of the transaction un accounted for,
it creates a third line with the .74 pre-filled in the debit/receive
Give this third line a memo of "GST" if desired, enter the
transfer account Expenses:Taxes:GST, accept the default 0.74
(which is also 8% of 9.26) and you are done. (If you wanted
to, you could have cleared the .74 and entered 9.26*.08
instead, or even 10.00 - 9.26)
Whew! Done. It's not as complicated as I make it sound, but
trying to type out an explanation takes much longer than looking
over your shoulder and saying "move here, click there, Type!"
Now what happens the next day, when you have the exact same
transaction? Just go to Assets:Petty Cash, highlight yesterday's
transaction, and click the "duplicate" button in the toolbar.
A dialog comes up asking you for the date of the new transaction.
It's pre-filled to the current date, but you can change it using
the + / - keys, or just type a new date if needed. And that's
it -- if the parking amount is the same every day, you just need
to duplicate the transaction.
I think there may even be ways to schedule the transaction, but
scheduled transactions that would be for another e-mail.
+ Beth Leonard +
+ O say, does that star-spangled banner yet wave +
+ O'er the land of the free and the home of the brave? +
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