Accounting Entries for POS Transactions

Accounting Entries for POS Transactions

Introduction

Every POS transaction in iVendNext automatically generates accounting entries, ensuring accurate financial records. This guide explains the double-entry bookkeeping behind sales, returns, and tax handling—critical for compliance and reporting.



1. How POS Transactions Affect Your Books

Standard Sales Invoice Entry

When a $120 sale (including $20 tax) is made via cash:


Account

Debit ($)

Credit ($)

Purpose

Cash Account

120

–

Amount received

Sales Income

–

100

Net revenue

Tax Payable

–

20

Liability to government


NotesNote: Entries auto-post based on your Chart of Accounts setup.




2. Accessing Transaction Ledgers

  1. Open the Sales Invoice from:

    • POS Recent Orders

    • Home > Accounting > Sales Invoices

  2. Click View Ledger to see details.



3. Special Scenarios & Adjustments

A. Returns/Credit Notes

A $50 return (original $40 item + $10 tax):


Account

Debit ($)

Credit ($)

Sales Returns

40

–

Tax Payable

10

–

Customer Account

–

50

B. Discounts Applied

A 10% discount on a $100 item:


Account

Debit ($)

Credit ($)

Cash

90

–

Sales Income

–

90


C. Change Given to Customer

If $10 change is returned from a cash payment:


Account

Debit ($)

Credit ($)

Change Account

–

10



4. Tax Handling

iVendNext auto-calculates taxes based on:


  • Item tax templates (e.g., 5% GST, 10% VAT)

  • Customer tax exemptions (if configured)


IdeaAudit Tip: Reconcile Tax Payable accounts monthly with filings.



5. Bank/Card Payment Entries

For card payments, the Bank Account is debited instead of Cash:


Account

Debit ($)

Credit ($)

Bank Account

120

–

Sales Income

–

100

Tax Payable

–

20



6. Troubleshooting Discrepancies

Issue

Check

Missing ledger entries

Verify POS Profile > Accounting links

Incorrect tax amounts

Review item Tax Templates

Change not reflecting

Confirm Change Account is set in POS Profile



7. Best Practices

✔ Daily reconciliation: Match POS Z-report totals with ledger balances.
✔ Customize accounts: Assign specific income accounts for product categories.
✔ Export entries: Sync with external accounting software (e.g., QuickBooks).



8. Advanced: Multi-Location Accounting

For chains, iVendNext can:


  • Track sales per location via Cost Centers

  • Consolidate entries at HQ while maintaining store-level reports



Conclusion

Understanding POS accounting entries ensures financial accuracy and simplifies audits. iVendNext automates the process, but staff should verify critical workflows.



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