How to record Shopify sales in QuickBooks Online - step by step
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- Опубликовано: 4 авг 2024
- This video has been updated - watch the updated video here • (Updated) How to recor...
Here's the latest step-by-step tutorial here • Record Shopify sales a...
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A really helpful tutorial trainer shows a good understanding of both accounting as well as Shopify. I will keep the channel subscribed for more videos.
Yes, check out all my videos and stay tuned for new videos coming soon.
This was SO helpful! Thank you!
Glad it was helpful!
Hello Veronica! your videos are my turn to whenever I am doubtful! Thank you and please never get tired of uploading informative and easy to digest bookkeeping videos. :)
btw, how do we categorize the discrepancy between sales and payouts shown in The Finances Report in shopify? Im talking about discrepancy of CZ 105,000 in for month for April 2021. huge amount and long overdue.
client never had a bookkeeper and asking me as well which method of bookkeeping fits shopify bookkeeping. Please enlighten me.
Hi Maude. I'm so glad that my content is helping you. I plan to continue making videos - no worries!
The drawback of using the manual method for recording Shopify sales is that there are timing differences between the sales on the Finance Report and the Payouts. You can only account for them using a clearing account.
I prefer to use A2X to integrate Shopify and QuickBooks Online.
Very helpful for bookkeepers wanting to niche in e-commerce.
Thank you Tyler!
Thanks this video saved me so much stress !!!
Glad you found it!
very helpful, thank you.
You're welcome!
hi, absolutely amazing video!! thank you so much for the amazing content. would you record shopify sales everyday, or could you also do it weekly? is it more beneficial to do it everyday? thanks!
You should start doing it daily. Once you have a process that works, then you could doing it weekly. But I recommend using A2X to streamline the whole process.
Love your videos! So helpful and easy to understand. You are good at this! I have a question regarding manual journal entries to record sales...Can I do this on a quarterly or monthly basis? If so, what date do I use for the journal entry? We are a very small store with minimal sales. Thanks in advance for your help!
I would recommend doing it on a weekly or monthly basis.
@@5MinuteBookkeeping Thanks! One more question if you don't mind, I use the Shopify Payments service to process payment for our orders rather than PayPal (per your example, I'm referring to journal entry #6 from Finances report). Would that clearing account be the same as "Shopify Payments Clearing" mentioned in your video (journal entry #8 from Payout report)? Tysm
Hi Veronica, thank you for this brilliant idea, very helpful!
May I ask a question please?
When you integrate A2X-Shopify-Xero(or other software) is still needed to do this journal?
Or it is enough to setup the accounts?
If you use A2X, you would not use the journal entry I showed in this video.
Thanks very much.
You're welcome!
Hi! Thank you for a very informative video. since the recording of sales transaction are done manually under Journal Entry Tab, does it mean that it's the only way to record sales transaction when it comes to e-commerce businesses? no shortcut?
You can integrate QBO and Shopify using my app of choice, A2X.
Thank you for this clear and concise video! Question: are the clearing accounts essentially like undeposited funds? Couldn't the account type be classified as undeposited funds instead of other current assets?
Hi. Yes, they are like Undeposited Funds but you would not want to use the UF account type. Each payment processor must use a separate clearing account.
Hi there,
Thank you for this helpful tutorial. Would you be able to do a similar tutorial with Amazon reporting to show how we can do Amazon clearing account?
Hi Sara. Great suggestion. I'll add it to my list.
Hi Veronica, do you have these 2 part videos written in pdf format or on a website where I can read it and study it? if so please send link. Thanks!
PS: Thanks for all your hard work, it's really appreciated.
Hi Gi, I do not.
Hi this is great can you use a sales receipt instead of a journal?
Yes you can.
Your video is gold!
how do I account for? :
My shopify store sells in USD. Finance summary is all in USD.
Bank account is in CAD. Conversion happens at the time of payout. My QBO is in CAD
Thank you. I don't work with multicurrency, so I can't offer much help.
Veronica, thank you for this video! One question: how do we deal with the PayPal fees?
You're welcome, Benni.
You have to record PayPal fees either when the PayPal funds are deposited (if you're using the Connect to PayPal app) or you have to pick them up manually from Paypal once a month and record them using a journal entry.
Good video! Can I just tally up all the income/expenses for the end of the year and input it in Quickbooks instead of doing it day to day?
You could but it would be very hard to reconcile all of it to the amounts you received in your bank account.
Hi Veronica, thanks for this video. I have questions, what if the currency used in selling is different from the payouts (e.g. Shopify store currency is in GB but the payouts are in USD). In this case, the finances summary report will show the amounts in GBP, but the payouts will show in USD. How will I record this in QB? Is it safe to use a conversion rate by dividing the payout values over the shopify payments values in finances summary report?
Hi Vivian. I don't work with multi-currency. However, if there is a currency conversion, I believe your suggestion may work - dividing the payout values over the shopify payments values in finances summary report.
Thanks for this helpful video! Why is "sales of product income" the detail type for "Shopify returns?" Could "discounts/refunds given" also be used for the detail type?
You can use Discounts/Refunds given as the detail type and that would probably be more accurate. The Detail type does not show up on any QBO reports.
Hello Veronica. I just watched your video again to understand how A2X works at transferring sales. I have an issue where my daily finance summary does not match my payouts. From what I can tell, although my shopify account is on PST -GMT 800, the payout is in a different time zone. Have you had this problem before and is there a way to work around it? I have not started using A2X yet but I would really like to.
Hi. Yes, this is an issue and it is due to timing differences. You could use a clearing account to handle the timing differences. But, I really recommend using an app like A2X to streamline the whole process. I think you'll find yourself spending a lot of time trying to do it manually.
Hello, so depending on what you are selling, you are supposed to pay sales tax on those items correct? Wouldn't that mean that you create a sales tax account with your state (TX) and pay that monthly? Also, wouldn't you typically charge the customer sales tax and essentially it would be what you collected from them that you would have to pay to the state, more or less? Please advise
You could choose to track sales taxes in QBO - that's more advanced and I chose to keep my tutorial simple.
Whenever you collect sales tax from a customer, that is recorded as a liability and you remit the sales taxes to the corresponding state agencies.
Very Helpful video Veronica!
Quick question, as per the Shopify Sales Report 1-5, that accounts for Gross Sales, discounts, Shipping, etc..is it fair to say that PayPal transactions on the PayPal monthly statement (when it comes to reconcile) are not considered sales as they already have been accounted as sales on the Shopify Sale Report? Also, Shipping/Returns/Discounts are already accounted by recording the Shopify Sales entries? Thank you!!!
PayPal transactions on the monthly statements are not sales. You are already recording the sales, shipping, discounts, fees from Shopify.
@@5MinuteBookkeeping Thank you so much for your reply Veronica. I can't thank you enough. Now I can finish my reports.
Around the 08:22 mark.... Did you say as a shopify seller we "should" or "shouldn't be" using QuickBooks sales tax center? I couldn't quite make out which it was. Thank you
Hi. I believe I said as a Shopify seller you should not be using the QBO sales tax center.
@@5MinuteBookkeeping thank you. That was my assumption as well. But I sell a lot of other places and channels besides shopify (including in person retail) so I have sales tax center still setup. Do you suggest not using it at all? Or just for the shopify sales? Thank you
Very helpful videos! I do have a discrepancy that I can't seem to find. My Shopify Payments amount on the Finances summary page does not match my Payouts for the month so my Journal entry is out of whack. Any idea why? My Total Sales does match the the Total Payments so I assume it is not a timing issue. Thank you!
Have you watched the updated video I did? take a look at it here ruclips.net/video/8klzPqyF_Ek/видео.html
Please do a similar video on Stripe and QBO. Thank you!
Great suggestion!
@@5MinuteBookkeeping looking forward to it!
Thank you for this video, amazing! I do have a question... Which is better to use, COGS or expense? Which will benefit the seller more?
Thank you Lani! I prefer to use COGS because it gives sellers a clearer picture of their profits.
@@5MinuteBookkeeping thank you! I'm just getting started as bookkeeper and want to niche on e-commerce.. do you have a specific course for anything and everything e-commerce?
@@lanibeahan3548 Take a look at Catching Clouds Academy. They have two e-commerce courses.
@@5MinuteBookkeeping thank you!
Hi Veronica great video can't thank you enough. Quick question can this method be used to record sales monthly?
I don't recommend it because of the timing differences with payment processors and because it may be difficult to reconcile the payment processor clearing accounts.
@@5MinuteBookkeeping Hi! Thanks for the tuto. But what if It's the case? All store don't have a big volume of transaction to make a journal entry everyday. What to do if you select a monthly or bimonthly payment from shopify?
@@resoluweb5400 You could record transactions on a weekly basis. I wouldn't do it monthly because it may be hard to reconcile transactions and find any errors.
Hi Veronica, the Clearing account how will get 0 at the end? with which accounts clearing will be credited?
You should record payment processor fees as a Debit to the expense account and as a credit to the clearing account. That will reduce the clearing account balance. You should also record all deposits received from payment processors to their corresponding clearing accounts.
Keep in mind also that clearing account balances will rarely be 0 because of timing differences.
Hi Veronica! Thanks for this video it helps a lot. How do we record a gift card payment?
For gift cads, you should set up a liability account and an item in the products and services list that is mapped to that liability account (You can call it "Gift card").
When a gift card is sold - enter a positive amount to the gift card item in the sales receipt.
When a gift card is redeemed - enter a negative amount to the gift card item in the sales receipt.
@@5MinuteBookkeeping thanks for replying Veronika, follow up question, this means a customer paid an item using Gift Card, is a liability?
@@princesstolentino4015 It is a reduction of the gift card liability.
@@5MinuteBookkeeping big thanks Veronica 🙏
hI vERonica, do you have video on how to record shopify billing? the billing includes the shippping, apps etc
Hi Diosdado, I don't but I will add that to my list.
We get the monthly billing statement from Shopify and record the expenses based on the billing statement.
@@5MinuteBookkeeping : The shopify fees that we enter, is this the same as the expenses we are billed (example subscription) or are these different entries?
@@CourtneyDancer222 There are Shopify payment processing fees. Those are different from the charges that you pay every month to Shopify (for the software, apps and other fees like shipping).
I dont need to record a sales receipt on quickbooks in this case? I can simply put the manual journal entry? and then for auditing I can simply share my receipts that I generated to customers?
Yes, that is correct.
I have a newbie question. I added the journal entry like you mentioned and can not match my bank deposits to the journal entry. What do I need to do?
Hi Craig. I'm sorry for not replying sooner. I thought I had already replied to your question. The journal entry will not match to the bank deposit from Shopify. I have published an updated video here that you may want to look at ruclips.net/video/8klzPqyF_Ek/видео.html
Do you have any videos about how to download transactions from BigCommerce into QuickBooks, then apply payments?
No, I don't work with BigCommerce.
I don't quite understand whether this is all that's needed, or whether one must also record each individual transaction to QBO that happens in Shopify?
You should never record each individual transaction in QBO - that would be very inefficient and you don't need to add so many transactions to QBO. You can use the method that I show in this video or you can use an app like A2X to integrate Shopify and QBO.
Hi, I have a client and he records shopify sales via Bank feeds and just create a Journal entry for Shopify Shipping Income as credit and debit to shopify sales. No record for Discounts, returns and others mentioned on your video. Do you have any recommendation on what to do? Thank you and looking forward to your response
I recommend using A2X to integrate Shopify and QBO. I don't recommend using the method that your client is using, unless they have a small amount of sales.
Hi Veronica, another questions,
1 )i was trying to add chart of accounts you recommended for sales tax liability, there is no "other current liabilities" detail type for sales tax liability, i can only see current liabilities.
2) i linked my business chequing account and transactions from shopify receipt payment from dec - feb are missing. how can i import those?
It sounds like you're in Canada. The detail types are different in your version of QBO. You can choose "current liabilities".
If you linked your bank account to QBO and you need to import transactions beyond the 90 days that it normally imports, you would need to go to your online banking and see if you can download the transactions in CSV format so that you can import them in the Banking Transactions window.
I just realized that my Shopify is showing all in USD as I'm selling in the international market, but my QB is recorded in CAD. Do you have any way for the currency to convert so it's matched up?
You may need to turn on multi-currency in QBO from the Settings menu.
We don't have much activity yet in this productBUT It would be so helpful to be able to export the daily activity to import into our accounting software. Any ideas on how that can be done
Yes, you can use an app called A2X to sync Shopify transactions to QBO.
Would we still do all of this through a journal entry if individual products exist in QBO and if each sale is automatically imported?
No, you would do a journal entry if transactions are not already added to your QBO. If each sale is automatically imported to QBO (although I don't recommend doing this), then you would not need to do the journal entry.
@@5MinuteBookkeeping thank you. I also don't track my products in qbo. I have a separate inventory management system and do periodic summary JEs. I was just curious and thought maybe I was missing out on a better way. :)
Hi, how about Paypal fees that appears only in Paypal website? Or it’s same fees shown in the view payout report. Thanks
Hi. I cover that in Part 2 of this tutorial. You can find it here ruclips.net/video/wrvwwAGA8nw/видео.html
@@5MinuteBookkeeping Thanks I found it later in the other video :)
Hi Veronica, How do you handle Amazon sales and payments through Shopify? We both sell on Amazon and accept Amazon payments on Shopify. I notice that Gross sales on Shopify already includes Amazon sales and payment are received here also. In amazon summary report, sales via shopify platform also reflected under product sale (non FBA) - How do I reconcile this that I will not be double entry on sale and at the same time getting a correct balance on both amazon and Shopify platform. Thanks
I would only record the sales through Shopify and would record the payments received from Amazon using a clearing account. You should really look into using A2X - it will simplify everything.
Hi madan.
I wached your vedio.but i want to create as e.commerce store company in quickbook to record transaction/ customer record.
Can you help me.please.
Hi. I work with US based Shopify sellers. You can learn more at vmwasek.com.
Hi Veronica! I think I’m confused about sales tax. Why doesn’t the report in shopify show that you charged the customer any sales tax?
Hi Danielle. I don't know what you are looking at exactly. First, sales tax needs to be set up in Shopify. There may also be reports in Shopify that list the sales tax collected.
What if you are simply doing Bank Reconciliation & the only Transaction you have access to, is the "CCD Shopify Deposit" appearing in the Bank Statement? How do you Categorize it, for a Client using the Cash basis Accounting system?
Hi Daniel, the amount received from Shopify may include income, refunds, deductions, gift cards, and sales taxes. You have to find the amounts in the Shopify Finances report to be able to determine the breakdown of the deposit received as I showed in the video.
@@5MinuteBookkeeping Thanks, I get it.
We have all of our sales go into a Shopify Clearing account and the numbers do not always match when I try to reconcile, sometimes 100's of sales in a day. Is there a better way to do this?
The most streamlined way to record Shopify income is to use A2X. Otherwise, you would have to record the income as I showed in the video by recording summarized transactions. It sounds like you may be recording each sale into QBO, in which case it makes it extremely difficult to reconcile.
What do you do when the Total Sales & Total Payments don't match up on the Finances Summary Page? Where do you find the differences so the Journal Entries will match up?
I just released a new video with an updated method for recording Shopify sales.
Our payouts do not provide a summary of the same invoices as the finances report. For example, our payout included payment from our first sale on May 22nd, but did not include money from our second sale on May 22nd. Therefore when I set the filter on the finances report, the information is not the same. Should I gather the information (gross sales, discounts, shipping, etc) invoice by invoice?
While my tutorial works in some situations, if you have a more complex needs - I highly recommend using A2X to automate the process.
@@5MinuteBookkeeping Hello Veronica and thank you for your response. I purchased A2X to automate the process. It's a great application! I'm having trouble matching the journal entries from A2X with the payouts from Shopify that show up in my Transactions>Banking menu in QBO. The payout amounts in Shopify do not match the payout amounts in A2X, therefore, I can not match the transactions in QBO. Do you have additional resources to help me understand and rectify this issue?
When to expect next video please?
I just published Part 2. You can find it here ruclips.net/video/wrvwwAGA8nw/видео.html
In your entry, inventory is not affected. How do I enter in my Shopify sales data so that it also reflects in inventory?
Those are two different types of entries. Check out these video where I explain how to update the inventory balances in Shopify. ruclips.net/video/Jf0JfDaaLpE/видео.html and ruclips.net/video/EPzzL0MusY8/видео.html
Can we have a video like this about Amazon?
Hi. I highly recommend using an app like A2X to record sales from Amazon into QBO. Amazon has many different types of deductions and fees and it makes it very cumbersome to make manual entries in QBO.
Hi Veronica. My "Shopify Payments" amounts under the finances summary is not matching any of the "Charges" amounts from the Payouts? I clicked January 1st as the date which brought up a Shopify payment of 40.82. However, no where under charges from the payout screen do I see that amount in January or Feburary. Please help.
This is an older video. Take a look at updated content here:
ruclips.net/video/v8vS1DOibvU/видео.htmlsi=T2sHaUFOfMVbMdHt and ruclips.net/video/yLTDTFiWhzM/видео.htmlsi=5T6N9VlX8VUzSKYZ
Hi, do I need to record daily? Can I record an entry for one quarter figure?
If you want to save time, you might want to record transactions weekly at first and then switch to monthly. It can be more challenging to reconcile payment processor clearing accounts if you make more summarized entries.
@@5MinuteBookkeepingthanks for replying! I plan to extract Data for one month from Shopify and post one entry as a summary for one month
@@jun_bungay You could try it out and see if you're able to reconcile the payment processor clearing accounts without problems.
A2X sounds great but it says on their website for the Shopify app it reconciles "Shopify Payments". Does that mean ONLY Shopify Payments or ALL payments from all payment providers like PayPal, Apple Pay, etc that were used on my Shopify site?
A2X brings over all sales, including sales processed by other payment processors. However, A2X does not record the fees from other payment processors and you also have to record all amounts received from payment processors to a clearing account.
@@5MinuteBookkeeping Hmmm...seems like A2X is a little misleading making it seem like it's a breeze using it with Shopify but since PayPal will be the vast majority of transactions and with the popularity of Apple Pay growing fast, what would really be the benefit? I'd have to do a lot of work for all the other payment methods! Any way you can do a video using A2X and what needs to be done with PayPay transactions? Thanks.
@@gijeet5374 All software makers want us to think that using their software or app is easy. But, at the end of the day, e-commerce accounting is not easy to do. I still recommend using A2X over a manual process. I will be releasing a course later this year on e-commerce accounting & A2X.
@@5MinuteBookkeeping Can't Wait! thanks!
hi I cant understand the concept you are debiting the shopify returns and discount and in charts of accounts you are treating it as an income account
Discounts and refunds and considered "contra income" accounts. That means that they are negative accounts that are recorded in the Income section of the P&L. They will show up in the Income section of the P&L with negative balances.
My Client only has Shopify Transactions appearing in their Bank Statement! How do I access the Shopify App, so as to view Finance Reports & Payouts Reports? Even the Bank Account isn't Linked to QuickBooks, hence Bank Feeds don't auto-update. I have to Import Banking Transactions!
You would have to ask your client to set you up as a user. Or, you can sign up as a Shopify Partner and then ask your client to give you access as a Shopify Partner.
@@5MinuteBookkeeping Thanks for the heads up. I'll do that.
I have a HUGE problem. I was able to use this method for my first payout of my new Shopify store and tried it with my second payout. I noticed that my second payout does not show all my transactions for X date and time. I did some research and this is because the Shopify payout cut off is 0:00 UTC time. Any orders after that is scheduled for the next day's payout, even if the sale was recorded on the day before. This is a huge problem because I live in Houston and our time zone is central, which is 6 hours behind UTC, which means any orders that I get after 6PM will show on the next day's payout not the current day's. This throws off my math when I am looking at the finance summary for days based on the transaction dates of the payout. What should I do?
Hi. This is the challenge with attempting to do the entry manually since it doesn't take timing differences into consideration. I'll be doing another video in the future to talk about timing differences and how you can change the journal entry. In the meantime, have you looked at A2X to sync QBO and Shopify? It sends summarized transactions to QBO and streamlines the whole process for you.
@@5MinuteBookkeeping Thank you. I ended up paying for A2X as the timing issue was to time consuming to fix. I used your promo code so thanks!
@@newnagasaki Glad you went with A2X. It makes things much easier.
How to setup Manual Paid? or Cash received from customer by using POS module
Thanks for the feedback. I'll see if I can cover that in a future video.
@@5MinuteBookkeeping Hi Veronica, did you cover this in one of your videos? I have some Gift Card Payouts and Manual Enter Payout but not sure how to account for this. My Shopify Holding account has an Overage...I believe is due to these payouts that I need to post to the Shopify Holding Account. Would you please explain if you're able? Thank you
@@mzn20101 Hi. I don't have a video specifically about these topics. But, for gift cards, you should record purchases and redemptions to a Gift Card Liability account (other current liability type account). For manual payouts, you should record those to a separate clearing account. You would have to determine the type of manual payouts you have and record the amounts received against the manual payouts clearing accounts.
@@5MinuteBookkeeping I'm doing monthly entries. The Liabilities section, I've been entering entries here as increase/decrease to the the liability. However, on the PAYMENTS section, I have "Gift Card" and "Manual"...do these need to be credited to the HOLDING account? I'm carrying a balance on the shopify holding acct. My Payouts (PayPal and Shopify Matched). I'm willing to pay for your services...I will probably need only 15/30 minutes of your time.
How could I reconcile that with my Bank account?
Hi. I have an updated video in which I go over my updated method for recording Shopify sales in QBO. I believe you saw it since you commented on it.