Source for "bonus" money on gift card

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Source for "bonus" money on gift card

Jason Ahrens
In the area here, we had a department store doing a gift-card "bonus" of
10%.

What happened is, you buy a gift card (say, $300) they add an extra 10%
to it ($30) giving you a total gift card balace of $330. You can then
use the card to buy anything in the store.

The interesting part now comes in how to record where this 'extra' $30
comes from, accounting wise? I'm half tempted to mark it as 'gift'
income from the store, but am not sure that is right. If I were to do
that, I'd put $300 on my payment vehicle, and $30 from my "income: gift"
account.

IS this the 'right' thing to do? Sticker price for everything stays the
same so all the receipts just show a payment with a gift card with $330
on it.

Thanks

Jason
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Re: Source for "bonus" money on gift card

Phil Longstaff
Jason wrote:

> In the area here, we had a department store doing a gift-card "bonus" of
> 10%.
>
> What happened is, you buy a gift card (say, $300) they add an extra 10%
> to it ($30) giving you a total gift card balace of $330. You can then
> use the card to buy anything in the store.
>
> The interesting part now comes in how to record where this 'extra' $30
> comes from, accounting wise? I'm half tempted to mark it as 'gift'
> income from the store, but am not sure that is right. If I were to do
> that, I'd put $300 on my payment vehicle, and $30 from my "income: gift"
> account.
>
> IS this the 'right' thing to do? Sticker price for everything stays the
> same so all the receipts just show a payment with a gift card with $330
> on it.
>
> Thanks

I would use income:gift.

Phil

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Re: Source for "bonus" money on gift card

Paul Schwartz
In reply to this post by Jason Ahrens
----- Original Message ----

> From: Phil Longstaff <[hidden email]>
> To: Jason <[hidden email]>
> Cc: [hidden email]
> Sent: Saturday, June 14, 2008 10:41:35 AM
> Subject: Re: Source for "bonus" money on gift card
>
> Jason wrote:
> > In the area here, we had a department store doing a gift-card "bonus" of
> > 10%.
> >
> > What happened is, you buy a gift card (say, $300) they add an extra 10%
> > to it ($30) giving you a total gift card balace of $330. You can then
> > use the card to buy anything in the store.
> >
> > The interesting part now comes in how to record where this 'extra' $30
> > comes from, accounting wise? I'm half tempted to mark it as 'gift'
> > income from the store, but am not sure that is right. If I were to do
> > that, I'd put $300 on my payment vehicle, and $30 from my "income: gift"
> > account.
> >
> > IS this the 'right' thing to do? Sticker price for everything stays the
> > same so all the receipts just show a payment with a gift card with $330
> > on it.
> >
> > Thanks
>
> I would use income:gift.
>
> Phil

I would credit against expenses as a rebate. Why mess up the income picture?

JMNSHO

Paul



     
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Re: Source for "bonus" money on gift card

sunfish62
If I were to receive a gift of $30 from my grandmother, I'd enter it as Income:Gift since that is what it is. I don't see why a gift from a retailer would be different.

If you really want to get technical, that $30 is a gift of value that the tax folks would want to know about.


--- On Sat, 6/14/08, Paul Schwartz <[hidden email]> wrote:

> From: Paul Schwartz <[hidden email]>
> Subject: Re: Source for "bonus" money on gift card
> To: "Phil Longstaff" <[hidden email]>, "Jason" <[hidden email]>
> Cc: [hidden email]
> Date: Saturday, June 14, 2008, 10:52 AM
> ----- Original Message ----
> > From: Phil Longstaff <[hidden email]>
> > To: Jason <[hidden email]>
> > Cc: [hidden email]
> > Sent: Saturday, June 14, 2008 10:41:35 AM
> > Subject: Re: Source for "bonus" money on
> gift card
> >
> > Jason wrote:
> > > In the area here, we had a department store doing
> a gift-card "bonus" of
> > > 10%.
> > >
> > > What happened is, you buy a gift card (say, $300)
> they add an extra 10%
> > > to it ($30) giving you a total gift card balace
> of $330. You can then
> > > use the card to buy anything in the store.
> > >
> > > The interesting part now comes in how to record
> where this 'extra' $30
> > > comes from, accounting wise? I'm half tempted
> to mark it as 'gift'
> > > income from the store, but am not sure that is
> right. If I were to do
> > > that, I'd put $300 on my payment vehicle, and
> $30 from my "income: gift"
> > > account.
> > >
> > > IS this the 'right' thing to do? Sticker
> price for everything stays the
> > > same so all the receipts just show a payment with
> a gift card with $330
> > > on it.
> > >
> > > Thanks
> >
> > I would use income:gift.
> >
> > Phil
>
> I would credit against expenses as a rebate. Why mess up
> the income picture?
>
> JMNSHO
>
> Paul
>
>
>
>      
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Re: Source for "bonus" money on gift card

Beth Leonard
In reply to this post by Jason Ahrens
On Sat, Jun 14, 2008 at 08:22:00AM -0700, Jason wrote:
> What happened is, you buy a gift card (say, $300) they add an extra 10%
> to it ($30) giving you a total gift card balace of $330. You can then
> use the card to buy anything in the store.

Personally I'd do a split transaction -- you paid $300 for a $330 asset.
As mentioned by another poster, the extra $30 is essentially a rebate
against things you'd buy in the store.  It's not "income" because
you can't use it anywhere else.

Expenses:Shopping rebate $30
Assets:Gift Card increase $330
Assets:Checking Account decrease $300

--Beth
Beth Leonard
http://www.LeonardFamilyVideos.com
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Re: Source for "bonus" money on gift card

Jason Ahrens
Beth Leonard wrote:
> Personally I'd do a split transaction -- you paid $300 for a $330 asset.
> As mentioned by another poster, the extra $30 is essentially a rebate
> against things you'd buy in the store.  It's not "income" because
> you can't use it anywhere else.
>  

Yeah. That's the other option. Unfortunately the store sells everything
from groceriest to electronice to furniture, etc... which makes tracking
each purchase as a "rebate" with a 10% split somewhat more tedious. I
was hoping for an easy way out :)

Jason
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