MoneyWorks uses the reverse sales invoice (negative invoice) method to record a credit note. It converts the sales invoice into a credit note by clicking on the reverse button on the sales invoice transaction.
Upon converting, it changes the quantity into a negative value, multiplying the unit price to derive a credit amount (negative) if you are using products or services (A negative net amount if you are using a ledger account instead). Of course, you can also manually enter a negative quantity instead of clicking the reverse button to create a credit note.
The credit note debits the sales and credit accounts receivable, which later offset the outstanding invoice.
You have an option of offsetting the credit note with an invoice from the Command menu (via a contra method) or when receiving payment from the customer. Both work, but offset during received payment is preferable (The contra feature is not for contra between a creditor and a debtor owing, but the credit note and outstanding invoice of the same debtor).
Credit Note (a.k.a. negative invoice) shared the same running sequent number as the sales invoice. You may manually change the reference number but try keeping the system-generated number to reduce confusion or mistake.
You can use the invoice form to print the Credit Note by amending the formula of the form tile from a simple text field to an if( ) statement:
It prints as a ‘Credit Note’ when the invoice gross is smaller than $0 and ‘Invoice’ when it is $0 or greater. It helps reduce the number of forms you require to manage, ease the operation and reduce mistake made.
MoneyWorks, as a hybrid system, allows sharing of data in the cloud and uses its feature-rich desktop app. Book a demo to find out how to use MoneyWorks to manage your business finance.
The overseas supplier, who are not GST registered trader, will not have the GST charges on the invoice. The Customs (or the forwarder may pay on your half) will impose the GST on the imported goods when goods arrived in Singapore.
The exchange rate used in the supplier invoice could be different from the Customs’ exchange rate. You may have received the supplier invoice before receiving goods and could have entered using your in-house exchange rate. Whereas you paid the GST based on the Customs’ exchange rate, convert upon goods arrived in Singapore.
Assuming you paid $700 GST to the Customs based on $10,000 worth of goods. The payments entry in MoneyWorks:
First detail line: Account: Cost of Goods Sold Net: 10,000 GST Code: IM (import GST code) GST amount: 700 Second detail line: Account: Cost of Goods Sold Net: (10,000) GST Code: OP (or *) GST amount: 0.00
(**Check with your accountant on the GST code use).
The Cost of Goods Sold used in the Payment transaction is a dummy account to facilitate the tax calculation. The taxable amount reversed on the second detail line to give a net (tax amount) of 700, which will then capture in the GST report.
The journal for the payment will be: DR. Cost of Goods Sold DR. GST Input CR. Cost of Goods Sold CR. Bank
MoneyWorks is a hybrid accounting system. You can purchase MoneyWorks Data centre and install the software on to your in-house or cloud server, or subscribe to MoneyWorks Now and host the data on MoneyWorks’ cloud server. Contact us to find out more.
An invoice is an official document from the seller to the buyer. It can be:
Print from a word processor, spreadsheet, or accounting software
Digital copy (e.g. PDF)
HTML format (e.g. QBO’s Online Delivery)
Digital copy is to save the invoice into a digital format (e.g. PDF – Portable Document Format) and email it to the customer. Digital invoice has become common these days when most people are working from home.
The e-invoice, on the other hand, refers to electronic invoicing. It is an electronic document created, exchange and process between businesses. The accounting software generates the invoice, send it to the e-invoice network (e.g. PEPPOL – Pan European Public Procurement On-Line) via the access point, and deliver it electronically to the customer. You may consider subscribing to Link4 (the e-invoice access point provider) if you are currently using QuickBooks Online (QBO).
Online Delivery is a term used by QuickBooks Online to deliver an HTML formatted invoice via email. It tracks the progress from the moment the customer opens up the email to making payment. Although it is HTML formatted, the recipient can print a copy for filing, or you can consider attaching a PDF copy to benefit those who prefer to receive invoices in a traditional invoice format.
How to set up Online Delivery in QBO?
Sign in to your QuickBooks Online account, click on the Gear icon and select Account and Settings from the list. Then, go to the Sales tab and scroll down to the Online Delivery section to turn on the feature.
Send an invoice.
Then, click on the Save and Send button on the invoice will email a copy of the invoice to the customer in HTML format. The invoice activity (e.g. when the customer has opened up the email) tracks at the bottom of the invoice.
QuickBooks Online is a small business accounting software. Sign up for a demo to find out how to leverage cloud-based accounting software.