Taxable Purchases

[Derek Atkins]

Donna Pfeifer <donna32132 at yahoo.com> writes:

> Is this the proper way to enter a taxable purchase? It results in a
> negative amount in the account "Sales Tax Owed" which doesn't seem
> right.

I believe that yes, it is the proper way to enter it, although I'm not
sure that this is really Sales Tax that is "Owed" -- it's Sales Tax that
you already paid out, so making the Liability negative makes sense.
It's not "money you owe to somebody else" (which is generally how I like
to think about liabilities).

When you make sales and collect sales taxes and split that into this
liability, that should increase the liability...  That is money you do
owe (to the government).

> Will it cause an issue with end of June reconciliation since I won't
> pay the sales tax until July?

It shouldn't -- just don't reconcile the transaction when you reconcile
the account.

> Thanks in advance.

> Please remember to CC this list on all your replies.
> You can do this by using Reply-To-List or Reply-All.

-derek

-- 
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
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