This write up is perhaps the most simple, straightforward way of recording Amazon product sales in QuickBooks Online. There are apps and other methods out there that may be better for you, especially if you deal in larger volumes of transactions.
The issue is that you have to create a separate step between the sales taking place on Amazon and the money being disbursed into your account because Amazon withdraws their fees prior to disbursing, so there is no way to accurately reflect the sales amount, and then really the secondary transaction of the processing expense by just entering the sales receipts into your main bank account. This write up also assumes that you’re using QuickBooks Online to track inventory.
1. Create An Amazon Clearing Account
This is the first step! You will want to create a separate bank account on your chart of accounts that is dedicated to Amazon sales and use it as a clearing account. You’ll see the reasons for this in a second.
2. Great! You’ve Received A Sale On Amazon!
The seller notification email you receive from Amazon has all of the information in it that you need to accurately record this multi step transaction.
So you can see that the actual product sale was $66.29, with $5.49 paid for shipping. And Amazon’s fees are a total of $11.76. They will disburse to me $60.02 for this transaction.
3. Enter The Sales Receipt Into QuickBooks Online
Choosing to deposit this transaction into the Amazon clearing account, it allows me to accurately record the net margin that I made on this particular item so my books stay in order. I’ve also added the shipping as a separate line item. So the total deposit for this transaction is $71.78
4. Now Enter The Amazon Fees As An Expense
Now you will want to enter the Amazon fees as an expense that is being debited from the Amazon clearing account. So in this case, I entered an expense for $11.76.
5. Now Review The Amazon Clearing Account on the COA
So upon reviewing the Amazon clearing account on my COA, I can see the balance in the clearing account is the amount of funds that Amazon states I will receive from this transaction. At this time, I will leave it here for now(My income’s been recorded, the expense fees have been recorded-the P and L is fine). Once Amazon disburses the funds into my bank account, I can then create a banking transfer between the Amazon clearing account and the account the money actually gets money deposited into, or I can create a journal entry.
Since Amazon and most e-commerce platforms disburse funds on a schedule and in batches rather than in individual transactions, by holding off until the money is disbursed into my account, I can add transactions to that future deposit seamlessly by using this method.
Hope that helps!
This post originally appeared at growthbusinessgr.com
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