Receiving and making cash purchases

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NewlandPC
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Receiving and making cash purchases

New to MYOB and bookkeeping, in general.

Which asset account should I be recording customer cash (physical) payments to: Business Bank Account or Petty Cash/Cash in Hand? At that, if I make a cash purchase, would I consider that a Petty Cash/Cash in Hand payment or a Business Bank Account payment, despite it not being a transfer payment? 

For example, fuel. If I pay for the fuel with cash that a customer payed me, would I record that in Spend Money as a payment from Petty Cash/Cash in Hand?

 

If I'm doing this all wrong, please give pointers.

Thanks heaps.

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MYOB Moderator Steven_M
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Re: Receiving and making cash purchases

@NewlandPC 

 

Generally, when you are dealing with cash you would have a bank account in AccountRight that is used to denote the cash on hand. This account can be set up via Accounts>>Accounts Lists>>Assets>>New and set the account type to be Bank. Note: if you do have a cash on hand/petty cash account you could look at using that account.

When it comes to recording transactions:

  • If you are getting money out of the main bank account i.e. getting cash out, you would do a Banking>>Spend Money account with the Pay From Account being the main bank account and the allocation account (account selected in the grid underneath the yellow section) you would select that newly created bank account i.e. the cash account.

  • If you have been paid in cash by a supplier and you are not doing a bank deposit i.e. actually using that cash, you would do a Purchases>>Pay Bills and select the Pay From account being that newly created bank account.

  • When you are using that cash, I would be recording a Banking>>Spend Money transaction with the Pay From Account being that newly created bank account and the desired allocation account i.e. fuel, postage...

Kind regards,
Steven

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NewlandPC
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Re: Receiving and making cash purchases

@Steven_M 

Thank you for your help!

With creating a new banking account though, does that mean I should have another account with my actual bank, which only deals with cash? How would I link it to my bank feeds otherwise?

 

 

MYOB Moderator Steven_M
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Re: Receiving and making cash purchases

Hi @NewlandPC 

 

That cash at bank account doesn't need to be an actual bank account at your bank. It's solely a bank account in AccountRight to reflect the amount of cash the company has.

 

As that account isn't reflective of an account held at a bank you wouldn't be able to apply for bank feeds on that account, however, you can reconcile and record transactions for that account similar to other bank accounts.

Kind regards,
Steven

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