Tuesday, September 11, 2018

Accounting for Free Gift Certificate.

To process a free gift certificate and at the same time recognize company's expense for the same, perform the following:

  1. Create a Gift Certificate.
    • Navigate to Lists > Accounting > Items > New
    • Click Gift Certificates
    • Enter all necessary information including the Income Account and Liability Account
  2. Create a Discount Item.
    • Navigate to Lists > Accounting > Items > New
    • Click Discount
    • Enter all necessary information including the Expense Account
  3. Enter Cash Sale.
    • Navigate to Transactions > Sales > Enter Cash Sale
    • Enter all necessary information such as the Customer name
    • Select the Gift Certificate created above and enter all the needed fields including the Authentication Code, if manually entered
    • Select the Discount Item in another line
      • Total transaction must be zero. The GL Impact is a debit to Expense Account (from discount item) and credit to Gift Certificate Payable (from gift certificate item)
  4. In the event that the recipient uses the GC above, same may be applied in an invoice or when it gets expired, navigate to List > Accounting > Gift Certificates > Recognize Revenue.

Note: Users may attach their case to Enhancement 168759: Enter a free gift certificate without adding an additional item or transaction to zero out the price.


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