Results 1 to 6 of 6

Thread: Contra Accounts to use with Customer and Supplier Journals

  1. #1
    Full Member
    Join Date
    May 2014
    Location
    South Africa
    Posts
    31
    Thanks
    1
    Thanked 1 Time in 1 Post

    Lightbulb Contra Accounts to use with Customer and Supplier Journals

    Hi,
    I need to do some journals, but I don't know which contra account to use:

    Example;
    Supplier Account
    Ref: 00004004
    Amount: +R761.59

    I don't know which contra account to use to do it. If I choose adjustments, the system says it's a Inventory account. The system won't allow me to use just 0000/000. When I click on settings, it shows 0000/000 however when I click on close it won't let me, so I chose 2100/000 just to let me be able to exit. It won't allow me to use control accounts either.

    Are there accounts to use by rule of thumb or do I have to create my own accounts to use for these kinds of journals ?

  2. #2
    Email problem Rowan Johns's Avatar
    Join Date
    Mar 2017
    Location
    Hillcrest
    Posts
    4
    Thanks
    0
    Thanked 1 Time in 1 Post
    Hi kevvie

    Not to sure why my reply is not going up.

    For supplier account you could use 9000/000 supplier control account as the contra account

    But if you're doing a supplier journal, you would use an expense account for the contra account (such as telephone / postage / stationery, etc. - whatever you spent). If it's a supplier journal for items you're going to re-sell, you would use a cost of sales account (usually an account in the 2000-2999 range)


    Sent from my E6653 using Tapatalk

  3. #3
    Diamond Member Neville Bailey's Avatar
    Join Date
    Nov 2010
    Location
    Westville, Durban
    Posts
    2,636
    Thanks
    41
    Thanked 435 Times in 381 Posts
    The question that needs to be asked is what is the reason for the supplier journal?

    Give me the answer to that question and I can advise you what contra account to use.
    Neville Bailey - Sage Pastel Accounting Consultant
    Phone: 031 521 0080 or 087 095 7895
    neville@accountingsoftwaresupport.co.za
    www.accountingsoftwaresupport.co.za
    IronTree Online Solutions

    "Give every person more in use value than you take from them in cash value."
    WALLACE WATTLES (1860-1911)

  4. #4
    Full Member
    Join Date
    May 2014
    Location
    South Africa
    Posts
    31
    Thanks
    1
    Thanked 1 Time in 1 Post
    Quote Originally Posted by Neville Bailey View Post
    The question that needs to be asked is what is the reason for the supplier journal?

    Give me the answer to that question and I can advise you what contra account to use.
    Hi Neville, always nice to hear from you.

    Let me try to explain.

    I have a supplier which is also my customer. So last year creditors dept decided to do a journal to deduct what we owe them and what they owe us. I now decided to reverse these journals and let the accounts be paid the normal way (they pay us, we pay them, no journals). The reason is that creditors dept now want invoices corresponding to amounts outstanding, long story.
    They did a journal on contra account 2100/000. If I am not mistaken they had to use Sales 1000/000, but what contra account for the suppliers as I don't have a Purchases account. Only a Purchase Variance.

    The amount is small, R1590.00. Credit dept did a journal to both Supplier and Customer account.

    I never know which accounts to use! Save me now

  5. #5
    Diamond Member Neville Bailey's Avatar
    Join Date
    Nov 2010
    Location
    Westville, Durban
    Posts
    2,636
    Thanks
    41
    Thanked 435 Times in 381 Posts
    Based on what you've described, then I would use any suspense account (such as 9990/000), as the net balance will be zero in the suspense account.

    If the supplier account is owed less than the what the customer owes you, then process a supplier journal to debit the supplier account with the full amount owed, and use 9990/000 as the contra account (credit). Then process a customer journal to credit the customer account with the amount you processed earlier, and use the same 9990/000 account as the contra account (debit).
    Neville Bailey - Sage Pastel Accounting Consultant
    Phone: 031 521 0080 or 087 095 7895
    neville@accountingsoftwaresupport.co.za
    www.accountingsoftwaresupport.co.za
    IronTree Online Solutions

    "Give every person more in use value than you take from them in cash value."
    WALLACE WATTLES (1860-1911)

  6. #6
    Full Member
    Join Date
    May 2014
    Location
    South Africa
    Posts
    31
    Thanks
    1
    Thanked 1 Time in 1 Post
    Quote Originally Posted by Neville Bailey View Post
    Based on what you've described, then I would use any suspense account (such as 9990/000), as the net balance will be zero in the suspense account.

    If the supplier account is owed less than the what the customer owes you, then process a supplier journal to debit the supplier account with the full amount owed, and use 9990/000 as the contra account (credit). Then process a customer journal to credit the customer account with the amount you processed earlier, and use the same 9990/000 account as the contra account (debit).
    Thanks very much, Will have a look at it.

Similar Threads

  1. supplier processing (journals)
    By YolandiN in forum Accounting Forum
    Replies: 5
    Last Post: 08-Jun-15, 03:08 PM
  2. contra accounts
    By pegasus in forum Accounting Forum
    Replies: 0
    Last Post: 22-May-15, 08:56 AM
  3. Balancing Suppliers Accounts-Creating Journals
    By Lavine in forum Accounting Forum
    Replies: 0
    Last Post: 01-Apr-15, 04:14 PM
  4. [Question] Customer Journals in Pastel
    By Raene in forum Accounting Forum
    Replies: 1
    Last Post: 23-Apr-13, 09:39 PM
  5. Quick Books - Customer Journals
    By KimH in forum Accounting Forum
    Replies: 17
    Last Post: 09-Jun-11, 05:46 AM

Tags for this Thread

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •