Discounts adding to income in Profit & Loss

This thread is now closed to new comments.
Some of the links provided in this thread may no longer be available or relevant.
If you have a question please start a new post.
Highlighted
Contributing Cover User womich
8 Posts
Contributing Cover User
womich
Contributing Cover User

8Posts

0Kudos

0Solutions

Solved: Go to Solution

Discounts adding to income in Profit & Loss

Hi
I'm using MYOB Essentials and have added Discount line items as dollar amounts to my invoices.
The invoices include Service items with positive amounts and discounts as Stock items with negative amounts.
I have used Discounts Given as the account for the discounts in the invoices.
 
When I run a P&L it includes the discounts as postive amounts, increasing the total income.
e.g. $600 service item and -$300 discount shows $300 on the invoice but $600 on the P&L.
 
The payments have all come through the bank account, and linked to the correct invoices.
 
What have I done wrong?
 
thanks so much for any assistance
mich
7 REPLIES 7
Contributing Cover User womich
8 Posts
Contributing Cover User
womich
Contributing Cover User

8Posts

0Kudos

0Solutions

Discounts adding to income in Profit & Loss

Hi

I'm using MYOB Essentials and have added Discount line items as dollar amounts to my invoices.

The invoices include Service items with positive amounts and discounts as Stock items with negative amounts.

I have used Discounts Given as the account for the discounts in the invoices.

 

When I run a P&L it includes the discounts as postive amounts, increasing the total income.

e.g. $600 service item and -$300 discount shows $300 on the invoice but $600 on the P&L.

 

The payments have all come through the bank account, and linked to the correct invoices.

 

What have I done wrong?

 

thanks so much for any assistance

mich

 

 

 

Jamalregan
4 Posts
User
Australia
Jamalregan

4Posts

0Kudos

0Solutions

Re: Discounts adding to income in Profit & Loss

Try the automated software for doing all these things.

Contributing Cover User womich
8 Posts
Contributing Cover User
womich
Contributing Cover User

8Posts

0Kudos

0Solutions

Re: Discounts adding to income in Profit & Loss

Hi Jamalregan

Thanks for your reply.

Not sure what other automated software you mean? Everything is in MYOB Essentials, and linked automatically.

I see I have posted this in the wrong forum section, sorry about that. I’ll copy this to the correct forum.
MYOB Moderator Steven_M
2,000 Posts
MYOB Moderator
New Zealand
Steven_M
MYOB Moderator

31525Posts

4118Kudos

4597Solutions

Accepted Solution Solved

Re: Discounts adding to income in Profit & Loss

Hi @womich

 

It sounds like the process is working as I would expect.

 

The Profit and Loss report will look at the accounts involved in the transaction. So for your example, you have the following accounts involved in your transaction.

Income account $600

Discount Given $300

 

Discount given being an expense account

 

When you display the Profit and Loss you will have the income of $600 (as that is what has gone to the account) and an expense value of $300 (as that is what has gone to the account). If you looked at your overall profit and loss for that transaction it would $300  ($600 - $300). 

When you look at it in real life, you have sold $600 worth of goods, however, $300 off it has been discounted, which is an expense to you and thus the Profit you received was only $300.

 

Attachment2.PNG

Attachment2.PNG

 

Kind regards,
Steven

MYOB Community Support

Online Help| Forum Search| my.MYOB| Download Page

Did my answer help?

Mark it as a SolutionHelpful? Leave a to tell others

Contributing Cover User womich
8 Posts
Contributing Cover User
womich
Contributing Cover User

8Posts

0Kudos

0Solutions

Re: Discounts adding to income in Profit & Loss

Thank you for explaining Steven. I accept this for the profit & loss.

Can you explain why the GST calculation adds the Discount Given to the Sales income and therefore shows GST owing on the $600 total rather than on the $300 that I received from the client? Thanks!
MYOB Moderator Steven_M
2,000 Posts
MYOB Moderator
New Zealand
Steven_M
MYOB Moderator

31525Posts

4118Kudos

4597Solutions

Re: Discounts adding to income in Profit & Loss

Hi @womich

 

What you should see in that example is something similar to the following:

 

Attachment2.PNG

 

As GST is calculated on a per line basis, it will take the value of the first line and calculate GST on that, goes to the second line to calculate the GST. Due the second line (discount) is going to an expense account you will have a value in the Purchase and Expense section, what this will do is reduce the overall GST. For example, you have $54.55 sales and income with $27.27 purchase and expense cancelling off a portion of that to give you $27.27 which is the overall GST amount of that invoice.

Kind regards,
Steven

MYOB Community Support

Online Help| Forum Search| my.MYOB| Download Page

Did my answer help?

Mark it as a SolutionHelpful? Leave a to tell others

Contributing Cover User womich
8 Posts
Contributing Cover User
womich
Contributing Cover User

8Posts

0Kudos

0Solutions

Re: Discounts adding to income in Profit & Loss

Thank you Steven!
I did not know this.
This shows correctly.
Thanks again!
Didn't find your answer here?
Try using advanced search to find a post more easily Advanced Search
or
Get the conversation started and make a new post Start a Post