Journal entry for cash sales used to pay tips
When daily cash is immediately spent on waiter tips or business expenses, those manual transactions will not show up in your bank feed. This creates confusion around how to appropriately increase or decrease undeposited cash, leaving you stuck trying to clear unmatched payments.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
Found another way around this?
Share your steps and trade-offs so fellow engineers don't have to reinvent the wheel. No account required.
Journal entry for cash sales used to pay tips
- 1Debiting undeposited cash and crediting a tips clearing account on the daily journal entryDid this help you?
- 2Looking back at how previous bookkeepers categorized and entered the transactions to mimic their processDid this help you?
- 3Keeping tips as a separate payable/clearing account, crediting cash when paid out, and moving the rest to cash on handDid this help you?
- 4Create a dedicated cash account in the software, post the cash payments as deposited there, and then book the expenses to that cash account.Did this help you?
- 5Record the cash transaction as a positive line item and the expense as a negative line item.Did this help you?
In their words
Unedited, grouped by where they were said, most upvoted first within each place, each linked to the thread it came from.
“The issues I’m having now is when it comes to Cash , I’m getting confused on how to do the JE . The cash made for the day gets paid to the waiters for tips .”source ↗
“What’s the best way to clean up the cash account . When I do a journal entry how should I increase or decrease undeposited cash , tips paid and then actually cash on hand”source ↗
“I have 2 payments, one for $45 and one for $40 that were paid in cash. I used this cash for expenses.”source ↗
“I manually entered these 2 expenses in quickbooks online. But the expenses i manually made won’t show up under bank transactions.”source ↗
“My question is, how do I clear the 2 unmatched payments of $40 and $45?”source ↗
Where this came up
People with this problem also raised
- 5Running out of cash to pay daily credit card tips
- 4Why do I have to pay a fee to get my earnings?
- 6Tracking business and personal finances without full accounting software
- 17How to handle expense reports without being good at math
- 2What to write in a wedding thank you card for money
- 2Why does the bank hold checks for so long?