Rustler’s Quickbooks Tips

Suppose you sell and your terms are 2/10/ net 30, that means 2% off if you pay within 10 days otherwise the full amount is due in 30 days.

When you make the sale you have no way of knowing if you will receive the full amount, or the discounted amount, so you make the sale and the sales account reflects the full price.  Let’s say you sold something for $100, if they pay within 10 days you will only receive $98, then what?

Set up an income account called Sales Discounts, and in the memo block make note that this is a “contra account” and the balance will normally be  a credit (a minus).

Set up an other charge item called Sales Discounts, set the rate to -2%, and point it to the Sales Discount account.

When you receive the discounted amount, Use receive payments, in the receive payments screen double click on the invoice to bring it up, and on the next line on the invoice enter the Sales Discount item. QB will calculate the discount, then click save, answer yes to your changing the invoice and do you want to save it.  That puts you back in the receive payments window and the invoice has the new balance, put a check mark by it and receive the money.

Undeposited funds reflects what you actually received, sales indicates the full amount of the sale, and the contra account Sales Discounts shows the amount that you discounted the sale as a negative.  When it is all added up to get total sales it balances out.