Double Transaction Method
If you are using the Double Transaction method, your cash transactions will be recorded in the Nominal Ledger in Transactions created both from Invoices and Purchase Invoices and from the
Cash In and Cash Out records created from these Invoices. Records that you enter directly to the Cash In and Cash Out registers with no related Invoice will also generate
Nominal Ledger Transactions. This system might be suitable where invoicing and cash handling are carried out in a different offices or departments.
To set up a Double Transaction system, follow these steps:
- In the Sub Systems setting in the Nominal Ledger, ensure the Invoice, Purchase Invoice, Cash In and Cash Out options are switched on.
- In the Cash Book module, switch on the Cash Collection option in the Cash Book Settings setting, and switch off the Payment Mode Control option.
- Again in the Cash Book module, enter one Payment Mode. Set the Type to "Cash" on flip B. In the N/L column on flip C, choose "GenTrans". The Account should be the Cash Account.
- Enter one Payment Term record in which the Type is "Cash" and with a temporary holding Account specified in the Cash Account field. You can do this using the setting in the Sales or Purchase Ledgers.
- Enter one Corresponding Mode in which the Account is the temporary holding Account specified in the Payment Term record. You should do this using the setting in the Cash Book module.
- If you have more than one Cash Account, repeat steps 3, 4 and 5 for each one.
- When entering a Cash Invoice or Purchase Invoice, enter the appropriate "Cash" Type Payment Term. When you approve and save the Invoice, it will be treated as paid. There will not be a posting to a Debtor or Creditor Account, but instead there will be one to the temporary holding Account from the Payment Term.
- Once you have approved the Invoice, you can create a Cash In or Cash Out record from it by selecting 'Create Cash In' or 'Create Cash Out' from the Operations menu. If you have several Invoices, you can create a single Cash In or Cash Out record from them using the 'Create Collection Cash In' or 'Create Collection Cash Out' Maintenance functions.
Enter the appropriate Payment and Corresponding Modes to these Cash In and Cash Out records and approve them. Nominal Ledger Transactions will be generated, moving the amounts out of the temporary holding Account and in to the Cash Account specified for the Payment Mode. If you only have one Payment and Corresponding Mode, you can have them offered as defaults using the Cash Book Settings setting.
- If you need to enter a cash transaction that has no stock implications, you can enter it directly to the Cash In or Cash Out registers. You will probably need a separate Corresponding Mode for this purpose. When you approve the record, a Nominal Ledger Transaction will be generated.
