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Accounting & Bookkeeping & Small Business Forum
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Guest
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| Posted: Sun Jul 11, 2004 5:03 am Post subject: Recording sale and redemption of gift certificates |
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| How to record, on the cash register, the initial sale of a gift certificate and then the redemption against a purchase. |
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Guest
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| Posted: Sun Jul 11, 2004 9:00 pm Post subject: RE: Recording sale and redemption of gift certificates |
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There's two ways -- both require that you identify the sale as a "gift certificate" by mapping that category to the button on the cash register.
1) Recognize it as a sale at the time the gift certificate is purchased and crediting the account when it is redeemed:
When gift certificate is sold
DR Cash
CR Gift Certificate Sales
When gift certificate is redeemed
DR Gift Certificate Sales
CR Sales of Product/Services
2) Recognize the gift certificate sell as a liability. This is most accurate but requires that you stay on top of the outstanding gift certificates:
When gift certificate is sold
DR Cash
CR Gift Certificates Payable
When gift certificate is redeemed
DR Gift Certificates Payable
CR Sales of Product/Services
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Guest
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| Posted: Thu Oct 07, 2004 6:01 pm Post subject: RE: Recording sale and redemption of gift certificates |
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| We sale gift certificates in our restrurant. We use a standard cash register to record the sale of a gift certificate. We do not colllect state sales tax at point of sale of the gift certificate. When the gift certificate is redempted we figure the sales tax on the amount of the item sold. But when we apply the redemption of the gift certificate against the item sold it zeros out the sales tax. How do you account for and collect the sales tax? |
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