Sales tax and Change given to customer

[David T.]

Hi. I think I disagree with Eric on this. 

Bear in mind, I am NOT an Accountant. 

But, I am pretty sure that if you take in 50 for a product and 2.50 in tax, you do NOT want that all entered as income, since it isn't. I am pretty certain that you will run into some tax authority who will slap your wrists on it. The 50 goes to Income; the 2.50 needs to go into a liability account and/or an expense account. 


Someone else will have more to say on the topic.

David



________________________________
 From: Eric Ladner <eric.ladner at gmail.com>
To: error404llc <error404llc at gmail.com> 
Cc: gnucash-user at gnucash.org 
Sent: Thursday, September 6, 2012 1:42 PM
Subject: Re: Sales tax and Change given to customer
 
On Thu, Sep 6, 2012 at 3:23 PM, error404llc <error404llc at gmail.com> wrote:
> How do I record Change I give to a customer, for instance if I sell something
> 52.50 and a customer gives me 53.00.  Where does that 50 cents I give back
> to the customer go?

You only ring up the sale for 52.50 - there's no need to account for
making change.  In the end, their bill is 52.50 and they gave you
52.50.

> How should I set up sales tax, for example when I sell something I just
> include tax in the price.  Is this ok, Just record total income, and then
> just figure out when I owe on tax in a liabilities account transfered to a
> sales tax currentasset account?

That would probably be easier than trying to split tax out of every
single transaction.  All your sales transactions go to a single
account?  Then you could transfer whatever percentage (say its 10%) to
the tax account.  Then your quarterly or whatever tax payments would
just be that value of that tax account and the payment would reduce
it's balance to zero.

-- 
Eric Ladner
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