Best way to do e bay/paypal accounting

[finest123]

Im using Vt transactions to keep my books - which I love.

Just wondering how everyone goes about doing the books for e bay/paypal. My way is very confusing and there must be an easier way out there.

Look forward to your replies

 

[finest123]

We are VAT registered as well

 

[Pish_Pash]

I've no idea of the 'best' way, but here's how I do it.

Ebay -> Linnworks->MS Access->Transaction Pro Importer & then finally -> Quickbooks

and not an accountant in sigh in that chaint!

it looks long winded, bit it's not...one days worth of sales gets piped into Quickbooks at the end of the day (takes about 2 minutes to do about 60 transactions)....I've coded MS Access to allocate the VAT code for the transaction (based on shipping county)....then once the transaction arrives in Quickbooks, it calculates the VAT (no human intervention required). I can then instantly see in real time how much gross profit I've made that day, week, month, financial year etc.

I don't 'handle' paypal on a transaction basis ...basically the proceeds from all ebay transactions goes into a 'bank' (a holding bucket) that I've called paypal gbp within Quickbooks. I've also added paypal as a supplier....once a month I add their fees into Quickbooks as a bill & then pay the bill from the paypal gbp 'bank'

Like wise Ebay fees....add them as a supplier & pay them from the same 'paypal gbp' bank in Quickbooks.

Granted, it wasn't the easiest to set up, but it's one of those win things...spend a BIT of time to save a LOT of time....what used to be my biggest headache & time sump is now pleasurable!

if you think Ebay is a headache wait until you use Amazon FBA....you'll spontaneously combust at the mere thought of having to wrap your head around the way they do things!

(BTW pointless asking accountants how to handle things like Ebay & Paypal...this is a process thing vs. a pure accountancy thing - best asking on an ecommerce forum)

 

[Energise Accounting]

accounting software is available which will handle all you pay pal and eBay transactions automatically however, it will not work with VT cash book.

 

[finest123]

Thank you for all your replies.

I had previously used freeagent before, who downloaded all transactions ect However, each transaction had to be explained which took hours.

The accountant suggested VT transactions and it has saved so much time and I love it. So dont really want to change, just seeing if anyone had a better way than mine. Which is to simply, download three months worth of transactions, separate sales for EU and non EU, expensive ect

I actually find Amazon payment system and FBA very very easier, if e bay was like that. I personally would not have any problems at all.

Would be great to hear from anyone who does paypal transactions manually without software

thanks

 

[David Griffiths]

You can set Paypal up as a separate bank account. Any money that comes into your current account from Paypal is put down as an inter account transfer. Then at the end of the month download the monthly summary and enter all sales as one total figure (net of returns) and enter fees as a single figure. Much less work than importing transactions and having to account for every single one.

 

[finest123]

I had found the monthly summary last night, did not even know paypal had it. The only thing extra I have to do is find non EU sales and refunds. I will start doing as you recommend, doing it monthly. Thank you for your reply David.

 

[MyAccountantOnline]

I often suggest the way David has mentioned too.

I'm a great fan of software that imports data, but sometimes with PayPal it can actually be quicker to summarise the monthly transactions and enter monthly totals rather than import a huge number of transactions.

 

[Pish_Pash]

I had found the monthly summary last night, did not even know paypal had it. The only thing extra I have to do is find non EU sales and refunds. I will start doing as you recommend, doing it monthly.

Which is exactly what I said a couple of posts prior

 

[littlelottie20]

Hi all
have just found this post and it's answered my question. The only query I have is what date do you use in VT for the monthly totals eg 1st of month, last of month etc ?

 

[Scalloway]

I would use the last day of the month the transactions took place.

 

[littlelottie20]

can anyone advise how to change the value of my stocks (inventory) as vt has calculated it by taking opening stock then adding purchased stock then minus sales but obviously my stock value has decreased due to obsolete products and write offs and I need to adjust it manually but cant work out how to do it

 

[Scalloway]

Unfortunately VT Cash Book only allows you to enter values as bank payments and receipts. I've got around this by setting up a dummy bank account so you need to do 2 entries from the dummy account.

1. Enter stock in cost of sales as a receipt
2. Enter stock in the balance sheet as a payment

The dummy account will be zero after these 2 entries.

 

[littlelottie20]

Hi Scalloway and many thanks for your reply
I don't think I explained myself properly. What I mean is I need to have my inventory value on my balance sheet showing what it is after allowing for depreciation as at the moment it just shows the full original cost after taking off sales. I read this extract in another post but not sure how to do it.

"At the end of any accounting period you have to adjust for the stock you've purchased which isn't sold. Not all businesses do this when they maintain accounting records often the accountant will do this when they prepare the year end accounts and tax return but you can do it. Its easiest done using a journal entry - debit stock on the balance sheet and credit closing stock which in VT is called 'Decrease/(increase) in stocks'."

 

[Scalloway]

You can't do Journal Entries if you only have VT Cash Book, you need to pay for VT Transaction. That is why I suggested the workaround I gave above.

 

[littlelottie20]

oh sorry i do have vt transaction but have attempted to do it but not sure how

 

[Scalloway]

The guide on doing journals is at the bottom of page 10 here.

http://www.vtsoftware.co.uk/support/VT Transaction user guide.pdf

If stock is already on the balance Sheet and you want to reduce the value then credit stock and debit cost of sales.

There is a facility to delete the journal if it is not correct so you can do it again.