[GNC] Commission sales

[Adrien Monteleone]

The usual "I am not an accountant and this is not accounting advice" 
applies here. The following is simply how *I* would approach this:


Some questions would need to be answered first.

Are you taking possession of the goods from your neighbor, or is this 
just a consignment type operation? (meaning, do you have any financial 
or legal interest in the goods, can you walk away with them, or can they 
take them back with no issue?) I understand this might be quite an 
informal arrangement, but unless you are buying the goods from the 
neighbor, I wouldn't think there is an occasion for entering a bill for 
them.

I would think a holding/suspense liability account for the funds 
collected on behalf of the neighbor would work, named something like 
'Sales-Payable'. (similar concept to sales tax collection) The full 
amount collected from the end customer drops here first from their 
invoice. (posted against AR, which itself is reduced as the end customer 
pays you.)

Result: Dr. AR, Cr. Liabilities:Sales-Payable

Note, if transactions take place on the spot, and they don't need some 
other 'invoice' than their credit card receipt, you can do this with 
manual transactions and avoid the Business Features and AR. The Autofill 
& Duplicate Transaction function can help cut down on data entry.

Do a manual transaction periodically or each time, reducing the holding 
account balanced against an income account. (Dr. Sales-Payable, Cr. 
Income:Commission)

If you didn't issue invoices in the first place, but used manual 
transactions, you can use a single transaction for this at each sale, 
but you'll have to employ some math. (GnuCash can do math in the amount 
fields)

Dr. Bank/Cash/etc. (however you immediately received funds)
Cr. Income:Commission (entered as the sale amount * commission %)
Cr. Sales-Payable (amount collected, minus the commission split, if you 
enter splits in this order, this amount will already be filled in.)

Then periodically or as needed, issue a bill 'from' the neighbor (as a 
vendor) for the amount you collected for them minus the commission, 
which should be the balance of the Sales-Payable account. (Dr. 
Sales-Payable, Cr. AP)

Then pay them the balance of funds. (Dr. AP, Cr. Bank/Cash, etc.)


Regards,
Adrien

On 1/13/21 12:09 PM, R. Victor Klassen wrote:
> Since early in the pandemic we’ve been selling some of our neighbour’s stuff, charging a few percent commission, mostly to cover credit card fees.
> 
> Our income here is really just the commission since the end customer knows it isn’t ours and we aren’t providing any value add othe than facilitating the order and delivery process.
> 
> The only way I have figured out to account using the business features is to enter an invoice to the end customer and a bill for the full amount from the neighbour.  Then I have to hack around in the income and expense accounts to make the difference between the two show up as commission.
> 
> This is because I can’t put an income account in a bill.
> 
> Is there a more elegant way of handling this?