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MaryJohn56
August 8, 2020
Question

Record commission paid as worker at store.

  • August 8, 2020
  • 1 reply
  • 0 views

Hope someone can help me figure out how to set this up in the general ledger. My client owns spa equipment and works out of a spa with that equipment as a contractor essentially.  She has her own business which is incorporated.  I am setting up her books in QBO.  She gets paid 70% of what was rung in the cash register at the spa plus 5% GST.

 

I believe somehow the 30% that the spa keeps could/should be recorded as an expense.  Am I correct, or is the 30% just ignored?

 

Should an invoice be generated to equal the cheque she receives?

 

Thanks for your help.

 

1 reply

LeithG
LeithG
August 14, 2020

HI MaryJohn56:

 

If your client receives the cash and the full GST amount from her customers, and remits 30% of the sale as a rental or commission fee, you'd want to record the full amount as revenue so it jives with the GST collection and remittance to the government, and the 30% as an expense against the revenue.

If the business she's paying the 30% to is responsible to pay the GST on their portion of the sale the recording would be slightly different.

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