Recording all purchases under a vendor???

[Maf. King]

On Wed 25 March 15 02:56:00 nssimpson wrote:
> Hi Maf
> 
> Thanks for offering advice. We are in the UK and account for VAT on the date
> shown on the invoice (accrual).
> 
> Kind regards
> 
> Nick
> 
> 
> On Wed 25 March 15 09:58:17 Maf. King wrote:
> On Wed 25 March 15 02:26:32 nssimpson wrote:
> > Hi

> > Around half of my vendors require immediate payment before shipping any
> > goods so I either pay them on card or bank transfer. Now when I get their
> > invoice should I be recording it as a vendor bill and posting it so it
> > appears in accounts payable and then immediately setting it to paid? I've
> > been reading help documentation and watching YouTube tutorials and some
> > people simply enter them straight into an expenses sub-account rather than
> > doing this so I'm a bit confused.

Right.  To be honest, it doesn't matter, as long as you are consistent.  Since 
you are on accrual basis, the doc. date is what counts.  

IMHO, using A/P is more work for "immediate pay" transactions (and in 
particular, one-off purchases)  than entering directly to an expense account 
and manually splitting the VAT to the asset account.  It is what I do.  most 
purchases go through A/P, but there is the odd thing that I pay for by up-
front bank transfer that never touches AP.  

If you enter a bill into A/P, and pay it more or less immediately, you are 
making more work for yourself, just because of the extra typing/clicking with 
the "new bill" dialogues & setting up vendors. 

 Of Course just to muddy the waters... if a vendor decides that you are 
trustworthy after a few orders, and gives you 30 days, then you are all set 
and ready to go with the A/P, just change the terms and off you go.

> 
> > I also have the same question about customers that pay upfront but I'm
> > guessing the best way of recording those is to record under customer
> > invoice, posting it and recording it as paid.
> > 

Yep, I'd do that.  especially if you are creating invoices in the same number 
sequence for the up-front & credit terms customers...

> > Then when it comes to office purchases, do I record the invoices I get
> > from
> > say Amazon as a vendor bill or do I simply enter them into an expenses
> > sub-account?

I would treat office supplies vendors no differently than widget vendors.  A/P 
if there are terms, Direct to Expenses:Foo if it is a one-off purchase.


> > 
> > I have read that reports differ depending on how things are logged but I'm
> > just a bit lost at the minute. I don't understand when I should enter
> > transactions directly within a sub-account.

The payables report will only show what is owing, but the expense / 
transaction / balance sheet reports should all be fine with mixed entry.  The 
bills in A/P will affect Expenses:whatever, so your total expenses will always 
be what you have bought, regardless of when you paid. 

HTH,
Maf.