Hi all!! Our business operates on 90% of its sales via credit card transactions. However, there is a delay of 1-2 business days before we receive funds from our credit card payment processor (eg. Moneris) and into our bank account. This is our current process so far 1. Record Sale at time of transaction (DR. AR, CR. Revenue) 2. We receive monthly report from Moneris showing sales activity (DR Undeposited Funds, CR AR) 3. When funds hit the bank account (DR Bank, CR Undeposited Funds) Does anyone agree with our current process, or should we be drawing down the Accounts receivable when the funds physically hit the bank account?? Any input would be helpful, and yes we use Quickbooks Pro
Posting Credit Card Payments Journal Entries _ Best Accounting Treatment
Answers
Not sure of the value of step 2. Seems like this can be an offline rec if needed. Is there an issue you have in received the funds? What is the value of tracking this or this step?
AR, Revenue and cash seem like the key components you care about.
Winston
Do customers pay via credit card at time of sale? OR, do you sell on account then they pay the invoice afterwards. One is a "cash sale," the other is a "credit sale" so recording sales would be different.
If option 1 - the payment is at time of sale:
1. Credit Sales, credit sales tax liability, debit Credit Card Due/Undeposited CC deposits
On receipt of funds from Moneris
1. Credit Credit Card Due/Undeposited CC deposits, debit Bank
You may have to post card fees and bounce-backs at this time.
You should be getting Moneris reports daily. Waiting till after month end means:
1. Poor financial controls-a bounce-back could take 30 days for you to discover it
2. Slow closing process-you have to reconcile 30 days of settlements. If you did this daily you would close much faster.
Anon is right- you may do the specific charge by charge recon offline-again how can Moneris send you detail to speed this up?
Regards
Filed Under:
Accounting