Overseas online sales
Hugo
Member Posts: 1
Hi, I am a sole proprietor running a online and offline business in Malaysia. I do offline marketing collateral service and also selling digital goods such as ebooks, templates, and etc.
I need to set up the account using WAVE. I have no problem on my local business but I am lost in setting up the online business part.
My online flow is as below:
Sell my Ebooks on 'Sellfy' -> sold to worldwide online buyers -> pay to my PAYPAL in USD -> transfer to Malaysia RHB Bank in local currency RM.
'Sellfy' is a platform to sell downloadable items. They charge 5% transaction fee and monthly fee of USD9. Paypal also charge 3% each transaction. When convert the money from Paypal back to Malaysia RHB Bank there is another service charge and also exchange rate difference.
1) How do I record the transaction like this?
2) The exchange rate changes everyday and how do I record this?
3) Do I have to record everyday? There may be exchange gain or loss if I don't record every day..
4) If I have 100 sales everyday, how to record the sales? Do I have to record each and every single sales or just a lump sum?
5) How do I set the account chart?
I believe there are more questions to come but at the moment I need to know the solution for the above.
I hope you guys can give me a guidance or share your information. Please help.
Thanks.
Comments
Hi @Hugo.
Let's start with your first quest: How to account for merchant fees.
We're at work on a streamlined way to handle merchant account fees from third-party payments processors, but for the time being, you should be able to account for the fees using the steps below:
Create a special holding account to record full invoice payments. Head over to the "Chart of Accounts" in the Accounting tab. Click "Add an Account" and choose "Money in Transit" as the account type under the "Asset" header.
When a product is sold, add an income transaction to this account for the full amount of the payment before fees.
Add an expense transaction to the holding account for the amount of the merchant fees, categorized to "Merchant Account Fees." If this isn't precise enough for your needs, you might want to have separate accounts for different merchant fees.
When the deposit is pulled in from a bank connection (this should be the product's price less the merchant fees) categorize this transaction as a "Transfer from.." and select the holding account.
Your subscription cost
That fee of $9 a month would just be logged as a bill. You can enter bills as any currency.
On Exchange Rates
Wave calculates exchange rates automatically based on the mid-market rates from xe.com. As long as your transactions are dated accurately, the numbers should match up.
On recording sales in bulk
That really comes down to your preference. If you sell so many products in a day and enter your transactions manually, bulking them by day might be much easier. In the end, it's up to you.
On the Chart of Accounts
To add new accounts, you have to click on Chart of Accounts, under Accounting, in the menu on the left. You can customize it there to best suit the needs of your business.