About Denise Delozier Expertise I own a bookkeeping service and work mostly with small to mid-range
businesses using Quickbooks Pro. I am happy to help with all questions
concerning the use of Quickbooks and/or bookkeeping in general. (Sorry, but
no Quicken questions here. Quickbooks only, please). Thanks!"
Question Hi - I'm an experienced corporate quickbooks user - but not at all in a small retail business.
What is the best way to track daily sales and sales tax due (paid quarterly). The store does $400- or so in sales per day. Should I track $100 cash, $100 Visa, $100 AmEX and put into undeposited funds? That way I know if the funds come in that are due to me on the merchant account. Also, it's kind of awkward to track sales tax due - I need to keep a spreadsheet to calculate the non-taxable and taxable sales amounts - and then do my daily sales entry. Seems like it would be easier just to keep a spreadsheet to track the sales tax due?
Thank you so much for your help!!! I am using QB Pro 2004
Julie
Answer Julie,
Quickbooks will automatically handle the sales tax issue for you, but you have to turn the sales tax preference on. To do that, with Quickbooks open, click Edit, then Preferences, scroll down on the left until you see the Sales Tax icon and click it. Click the COMPANY PREFERENCES tab at the top of the window, then click YES for Sales Tax. Fill in the other information that applies to your business. The tax "type" is usually something like TN Sales Tax (for Tennessee), and once you enter that section, it will ask you what your sales tax rate is and who you make your payments to each time.
You have to choose whether you pay the sales tax at the time you invoice the client or at the time you actually receive the payment. In a retail business, it's typically at the time you receive the cash, but you need to check with your state sales tax department to determine what the regulations are for your area.
Once you are finished with the set up, Quickbooks will ask you if you want to make all customers taxable and all items taxable. In your situation, I would answer YES to both of those (leave them checked).
Click OK to save your preferences, and it will temporarily close all of your open windows and make the changes that are necessary to proceed with processing sales tax on future sales.
Since you are in retail, you probably do not actually invoice your clients. Instead, you will want to use the "Sales Receipt" form that is provided in Quickbooks to enter all of your sales for the day. (Click Customers and Enter Sales Receipt"). Using that form, you will want to enter whether the payment was VISA, Mastercard, Amex, Cash or Check, so that will help you with making your deposits correctly. Make sure that each Sales Receipt shows "Group with other Undeposited Funds" at the bottom and NOT Deposit directly to Checking.
If you have specific items that are not taxable on a certain sale, all you have to do is remove the small "T" that appears to the far right of each item on the Sales Receipt. Only items with a "T" present in the Tax column will calculate sales tax at the bottom of the receipt, and the liability you owe will only be figured on the amounts with a T beside them when it's time to pay the tax.
When you are ready to do your quarterly return, I recommend running the two reports that are available for sales tax tracking, printing them out, analyzing the results and keeping them for your records with your returns. To process the payment, you have to go to VENDORS, then SALES TAX, then PAY SALES TAX. You cannot create a regular check or bill for this payment because that will not connect with, and clear out the liability account that Quickbooks is tracking for you.
Once you process the tax payment, you will see an entry in your check register as a check ready "to print." You can follow your regular check printing procedures from there.
As far as merchant fees go, when you are ready to make a deposit, simply go to BANKING, then MAKE DEPOSITS. If you are receiving an AMEX deposit, they usually deduct the merchant fees at the same time they credit your account. To reflect your deposit correctly, select all AMEX payments you received for the day, then click OK. On the deposit screen, go to the first line below the last payment on the list, and click there to enter your merchant fee information. You want to enter this as a NEGATIVE amount on the deposit so that your net deposit amount is correct. This should be coded to a Merchant Fees expense account.
Depending on your situation, you may want to wait for confirmation of the deposit before posting the amount into the books, but if that is inconvenient for keeping track of your cash-flow position because of the time delay, you can calculate the fees (since it's based on a percentage of the deposit) and proceed with the entry. You may have to go back to that deposit make some minor adjustments for rounding, etc. when the merchant statement or bank statement actually comes in, but that's easy enough to do at any point during the reconciliation process.
I hope this helps you and saves you a ton of time. Once you start using it, you will love how it works. It's a simple and convenient way to track your sales and liabilities all at the same time.
Let me know if there is anything else I can do to help, or if you have any questions about these steps! I'm just doing this out of the top of my head so I may need to get you more details on a step or two!
