Two Double Entry Accounting Questions..

[FireFly]

--- On Thu, 1/27/11, Mark Phillips <mark at phillipsmarketing.biz> wrote:

> 1. I have to keep track of how much each parent donates -
> if more than
> $1,000 then I have to send them a 1099 at the end of the
> year. Less than
> $1,000 and their canceled checks are proof of donation. To
> take in a
> donation, I deposit the money in the checking account and
> offset that
> deposit to an income account for that person. At the end of
> the year, I look
> at everyone's income account and can see who needs a 1099.
> Sound good?

Item 1, sounds fine to me

> 
> 2. This one is trickier. We have a batting coach who comes
> once a week and
> charges a flat fee/team - $150. Teams average in size with
> 10-12 players.
> So, I charge each player $15 for 2 hours of batting
> instruction or about 100
> cuts/girl. Not all players show up every time - the average
> is 10. I want to
> set up an account for each team to keep track of how much
> extra they have
> paid in for batting, and if less than 10 players show up
> one time, deduct
> the $15/missing player from that account. If the account
> ever reaches $150,
> then they get a free night of batting. How do I enter the
> transaction? Based
> on # 1 above, I deposit $15 in the checking account and
> offset that with $15
> to the income account for that person. Any money I collect
> is a donation.
> Say I do that 11 times for a total deposit of $165. I then
> write a check for
> $150, and offset that against ....what...Batting expenses
> for the team? and
> what about the extra $15 that was paid in this week, and
> the missing $15
> next week because only 9 could make the practice?

To my mind, the best way to do this is going to be (remember, I'm not an accountant, nor have I ever suggested I'm an accountant)

Setup sub-accounts for each team in the checking account (assuming that's where these payments goto and come from). Each payment for batting practice goes into this sub-account, and all expense payments come out of that sub-account (nominally $150 per time). This way you have a sub-account that has the teams running "balance" for batting practice.

The only complexity comes if people pay for say that plus a donation at the same time, if that happens it may be tricker to reconcile (depending on your transaction volume and how you're doing reconciliation).

- James Duerr

E-mail: FireFlys_98 at yahoo.com
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