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Here is what I am trying to achieve: Our organization collects fees from consumers on certain products that they purchase. Retailers actually collect the fee from the consumer, and then remit it to us.
On a portion of these fees, the retailer is paid an agent fee for their administrative expenses involved with the collection and remitting of the fees.
To date our staff have been tracking all of this manually. I would like to migrate the transactions into Great Plains. My goal is to make the entries as simple as possible, and had dreamt up a solution with only one entry. However, when I tested my idea in GP it does not work, as I get an error message.
Example: Agent collects $100 in fees, deducts $20 in agent fees, submits $80 to us. My idea: Post an A/R with a value of $80. In the accounting distribution, enter the detail:
DR Accounts Receivable $80
DR Agent Fee Expense $20
CR Revenue $100
GP gives me the error that the distribution does not match the A/R amount.
I want to avoid having to post an AR entry, then an AP entry for the fees as this is cumbersome. The retailers always deducts their agent fees from what they submit, so we never have to issue any payments to the retailers. Any ideas?
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Thank you! I've tested out the suggestion and it seems to work like a charm.
Lee
Lee,
I think what Ian is suggesting is the best approach - I would use a trade discount for this as well. Some more detail on setting this up:
GP will automatically calculate the amount due on the invoice as $80 and all your distributions will be as you specified in your post.
How much do you enter the AR invoice for? 100 or 80?
You could set up the Invoice for 100 and enter a trade discount of 20 - and post the 20 to the Agent Fee Expense account.
Do you collect the 100 or the 80 - ie do you need to create an AP Invoice for the 20, and then pay a check to the agent....or do they collect the 100 and deduct their fee and then pay you the difference?You could consider setting the agent up as a sales person with an Accounts Payable account.
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