I receive an annual cash back amount for using the company credit card, which applies directly against the balance on my credit card statement each November. What is the best way to enter this transaction?
I receive an annual cash back amount for using the company credit card, which applies directly against the balance on my credit card statement each November. What is the best way to enter this transaction?
I usually credit the amount to the expense accounts I used the most on the Visa during the year. You could also credit a general expense account or purchases depending on what purchase accounts the business uses most with the Visa.
Why not declare it as revenue (without sales tax)? That is what it is.
I disagree. It is a credit towards the purchases you made in the year. It is not revenue. It's a discount on your purchases.
If it is a discount on purchases, remember to back out the taxes and then record the balance as a purchase discount. However, for simplicity I would agree with Richard Ridings and just record it as revenue.
I agree, the matching principle comes into play. It should be shown as revenue.
*Community Hub is the new name for Sage City