How to manage a cash box for farmers markets?
CottageOven
Member Posts: 21
Hello,
I sell my products at farmers markets and use a basic "cash box" (actually, a fanny pack) for handling cash sales during the market. I always start with a certain amount in the box, sell at two markets during the week, place the day's cash income into a bank-deposit envelope, leaving the original amount in the box. Then, once a week, when I go into town to shop for ingredients and supplies I take the envelope with me an deposit it into the bank.
For proper accounting, should I be entering any of this into wave? If so, how should I keep track of the cash on hand, even when some of it is kept separate in an envelope until deposited and is not maintained as the "cash on hand" that's in the box for use at the markets?
So far, I just haven't worried about it and the only part of it that would get entered into Wave is when I make the cash deposit at the bank. The amount kept as the starting amount in the box is never actually written or recorded anywhere.
Thanks.
Comments
I am no accounting expert but in my experience for a few of my businesses that require cash on hand I usually have a simple excel or printed chart such as the following.
100x
50x
20x
10x
5x
2x
1x
.25x
.10x
.5x
I do not deposit the amount daily but some people would advise doing so. I usually do it weekly unless I have a big amount.
But for using wave.
https://support.waveapps.com/hc/en-us/articles/360032641211-Keeping-Track-of-Petty-Cash
Best Regards,
Stanley Fu
Hi @CottageOven! Thanks for reaching out! @starburstnow has provided some great insight here. We recommend using the Wave guide linked above to Keep track of Petty Cash. It should have all the steps you need to follow
Thanks, everyone. The link you provided was just right and very helpful.
Since I handle all of my transactions via Square on my tablet, I have already written my own Android app to enter the count of each denomination, credit-card total, payouts (market fees), etc. to reconcile the "drawer" at the end of the day. Once I reset the "drawer" to the starting amount, the remaining cash gets added to the bank-deposit envelope until I take it to the bank once a week.
With the instructions at that link, I'll be able to account for the "drawer" starting amount and not just have a bunch of cash sitting around unlabeled.
Thanks again.
The guide was helpful, but still leaves a couple of questions unanswered.
1) Wave already provides a "Cash on Hand" account. May I use that for the Petty Cash, or is that something special that should be left alone (and, therefore, I should make a separate Petty Cash account)?
2) Since I reset the cash box to a certain amount at the end of the business day and put the cash from sales into a bank envelope for deposit once a week, what should I do, in Wave, to account for that cash when it hasn't been deposited yet, but is no longer in the cash box?
Thanks.
@CottageOven
1) It's ok to use Cash On Hand.
2) Normally, if you were a staff member doing to the banking, for security you have to sign out physical money on a manual document, and once you have the deposit slip from the bank match it up with the signed out document, to show you made the deposit physically and did not steal from your boss.
Since it's just you handling the cash, you don't need to do that - although it might be a good idea to have a notebook and jot it down. i.e. date, amount taken, date banked. Just in case you need to refer it.
In Wave, all you have to do is remove the amount you took from Cash on Hand and Add it to Bank, once you have the bank deposit slip. The balance left in Wave should be what you have left in your box.
Does that help?
Example:
Cash box starts at $150.
After Thursday's market, it has $450, so $300 is taken out and placed into a bank-deposit envelope.
After Sunday's market, it has $400, so $250 is taken out and added to the envelope, bringing the deposit to $550.
The deposit is taken to the bank on Monday.
Within Wave, shouldn't I be accounting for each of the steps? Otherwise, there's cash that belongs to the business that is just sitting in an envelope until it is deposited. Should I maybe create a "Hold for Deposit" account, transfer a day's receipts into that and then transfer that to the bank when the deposit is actually made? If so, do I somehow match that transfer to the transaction that gets imported from the bank connection so that I don't end up with double the amount of the deposit?
Thanks.
As I was looking through the Chart of Account, I noticed and area for "Money-in-Transit" accounts. Would that be something I should use to account for the cash that is in the bank-deposit envelop until it actually gets to the bank?
@CottageOven A Money in Transit account is typically used for funds that are expected to be deposited into or withdrawn from a Bank account at a future date. For example: credit card sales that have been processed but have not yet been deposited into your bank, or checks (written or received) that have not been deposited into or withdrawn from your bank account.
This article goes over an example of how this account can be used here: https://support.waveapps.com/hc/en-us/articles/360000389783-Bookkeeping-undeposited-checks
I would recommend speaking to an accounting professional regarding how you can implement this in your account for your needs and purposes. Let know if you have any other questions!
Actually, that sounds exactly like what I need. When the till is reset back to its starting amount at the end of the Thursday and Sunday markets, the day's cash receipts are placed into a bank-deposit envelope until it is taken to the bank and deposited on Monday. Thus, it is, as you say, "funds that are expected to be deposited into a Bank account at a future date."
@CottageOven Once the check or cash officially lands in your account statement, you can create a transfer from the money in transit account to your actual bank account zeroing out the transit account as there should never been a long term balance on this type of account!
Thanks. That's about how I pictured it.