Sale of gift card accrues a liability (credits this account), during redemption the liability is reduced (debited) and the correct Sales Account is credited. See example below.
This example uses screen shots from AccountMate, other host accounting systems post identically.
Sale of gift card in Acme…
… results in invoice in AM shown below. -Revenue Code is GIFTCARD, the 10 dollars credits the Gift Card Liability Account. Instead of the sales account.
Like all Acme transactions, the payment goes through ACMECASH to the Payment Clearing Account:
Redemption of part of the GC in Acme…
… results in sale in AM:
Like all Acme transactions, the payment goes through ACMECASH to the Payment Clearing Account:
Here is what AM would transfer to GL for the sale of the GC and redemption:
Cash Tray Reconciliation in Acme…
… Posts this to AM GL:
The end result looks like this: (blue is from sale of gift card, green is from redemption)
Account |
Debit |
Credit |
Change in Balance (neg = credit) |
Payment Clearing |
10.00 Sale of the Gift Card |
||
7.25 redemption of GC |
|||
17.25 Cash Tray Reconciliation (10.00 from sale and 7.25 from Cash Tray Reconciliation) |
0.00 |
||
Accounts Receivable |
0.00 |
0.00 |
|
Inventory |
41.36 redemption of GC |
-41.36 |
|
Gift Certificate Liability |
7.25 Cash Tray Reconciliation |
||
10.00 Sale of the Gift Card |
-2.75 |
||
Customer Deposits |
0 |
0 |
|
Sales |
7.25 redemption of GC |
-7.25 |
|
Cost of Goods Sold |
41.36 redemption of GC |
41.36 |
|
Bank Account |
10.00 Cash Tray Reconciliation |
10.00 |
