Accounting transactions for Gift Certificates?
Tuesday, November 18th, 2008
catfancier asked:
I do my own bookkeeping and wondering how to appropriately debit/credit my accounts for a gift certificate sold for professional services and then how to account for when it is used (partially). I received the payment just before my last fiscal year-end.
I do my own bookkeeping and wondering how to appropriately debit/credit my accounts for a gift certificate sold for professional services and then how to account for when it is used (partially). I received the payment just before my last fiscal year-end.
What are the adjustments I need to make at start of this fiscal year to show that a particular amount is prepaid for the client’s services? (debit/credits)
After I’ve invoiced the client, how do I draw down the amount to reduce the amount of gift certificate/prepayment still available.
For instance, the client starts the year with a credit of $250. Then I invoice for $50, with $200 remaining….
Any advice would be much appeciated!
Ida
