How does everyone deal with penny rounding in Canada? When accepting cash. How do you record it?

Hi @hair1 ,

I always make the entry as it is supposed to be.  Then I debit or credit the same income/expense with the penny rounding difference, indicating the rounding in the memo field.  i.e.

DR     Cash             10.65

CR     Sales                               9.58

CR     GST                                   .48

CR     PST                                    .57

CR     Sales                                 .02 (Penny rounding) (no tax applied to this)

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                                 10.65      10.65

If you wanted to, you could make a separate miscellaneous account and call it 'Penny Rounding', and post the difference to that instead.  If you chose to do that, I would probably make it an expense account, knowing that it may sometimes have a negative balance.  It's a matter of preference.  Some people would like the 2nd way better because they can see at a glance what's happening with the balance.  For me, it is so insignificant that I choose to put it to the same account as the sale is going to.

The same would be true in reverse if you are purchasing any items with petty cash.  The rounding would go into the same expense account you used for the transaction.