ack33
Jul 31, 2013, 08:57 PM
I have a website which allows users to pay in advance for credits ($1 = 1 credit). They can then use these credits to purchase digital items on the website at a later date, almost like a gift card.
My payment processor, who handles the transactions related to the purchase of credits, deducts a 15% fee from every credit purchased. Then they send me a check at a later date minus the 15% fee.
Currently I record this as follows:
-----When credits are purchased:
Accounts Receivable - Payment Processor $17 (dr.)
Payment Processor Commission Expense $3 (dr.)
Unearned Revenue $20 (cr.)
-----When credits are redeemed
Unearned Revenue $20 (dr.)
Sales $20 (cr.)
-----When I receive a check from the payment processor
Cash $17 (dr.)
Accounts Receivable - Payment Processor $17 (cr.)
So my question is regarding Payment Processor Commission Expense. Should this be expensed where I have it or when the actual sale happens? The actual sale (redemption of credits) could occur months after the credits have been purchased and months after I've already received a check from the payment processor.
My payment processor, who handles the transactions related to the purchase of credits, deducts a 15% fee from every credit purchased. Then they send me a check at a later date minus the 15% fee.
Currently I record this as follows:
-----When credits are purchased:
Accounts Receivable - Payment Processor $17 (dr.)
Payment Processor Commission Expense $3 (dr.)
Unearned Revenue $20 (cr.)
-----When credits are redeemed
Unearned Revenue $20 (dr.)
Sales $20 (cr.)
-----When I receive a check from the payment processor
Cash $17 (dr.)
Accounts Receivable - Payment Processor $17 (cr.)
So my question is regarding Payment Processor Commission Expense. Should this be expensed where I have it or when the actual sale happens? The actual sale (redemption of credits) could occur months after the credits have been purchased and months after I've already received a check from the payment processor.