Is the deposit taxable or not?

  • If the deposit is non-refundable,
    • a taxable transaction must be made with a sales GL account,
  • If the deposit is refundable,
    • a non-taxable transaction must be made with a passive GL account.

In this case if, as it is a loan to a customer, you might decide to exclude it from the sales report

 

What is the cost of filing on a tire bill?

The cost should be $ 0 since it is only a deposit and this in the 2 cases of figures above.

 

How to handle the costing on a deposit where there would be work and parts and the order is canceled?

  • A) If the deposit has not been treated as a (repayable) transaction,
    • a product invoice must be made with a "-1" DEP (non-taxable) and a new taxable NRD (Non-Refundable Deposit),
    • Go to C)

After 12 months, unused deposits should be converted into transactions.

  • B) If the deposit was treated as a transaction,
    • go to C)
  • C) Stock and labor management:
    • The active WO is transferred with the work of the client to the non-taxable "Internal Garage" client,
    • The invoice is closed with a "Cost Deposit" Payment Method with a GL in the same series as (cost of merchandise sold.)

It is strongly recommended to involve your accountant before proceeding.