Credit Card Rewards payment

[gccc]

We received a rewards payment from our credit card that was deposited straight into our checking account. I am unsure of how to enter this into PowerChurch. I assume I would do it through fund accounting, enter transactions and debit the checking account, but what expense account to credit? Or am I totally off base?

[NeilZ]

We received a rewards payment from our credit card that was deposited straight into our checking account. I am unsure of how to enter this into PowerChurch. I assume I would do it through fund accounting, enter transactions and debit the checking account, but what expense account to credit? Or am I totally off base?

OK .. this is a cash reward that adds fund to your checking account. This is a simple transaction, and yes it is entered via Funds Accounting.

1. DEBIT the checking account for the amount of the rewards payment.
2. CREDIT a miscellaneous INCOME (normally 4000 series) account if you have one. If not, create one. I usually enter all the pertinent data about where the funds came from in the note section of the transaction window.

You are not getting any sort of REFUND, which would happen if you had returned an item, or the store charged to much, etc, etc. In that case, yes, you would DEBIT checking, and CREDIT the expense account that was charged with the expense. In this case, you are showing that the item was returned and the church did not spend any funds, and neither did the ministry originally expensed.

Cash rewards are income, period. The church got them by using the card, but you are not getting any sort of 'discount' or 'amount off' what you spent. Normally this type of reward program by a credit card company is paid for from the fees the credit card company charges the merchant, all the church does is have to use the card.

Make sense ??

[gccc]

Makes total sense. Thanks so much!

[gccc]

I have a different scenario regarding the rewards redemption since my post in 2017.

This last time I redeemed them, the only option I had available was to have the credit applied to our next statement. When that statement came, we actually wound up with a credit on our Visa account because the reward redemption was more than our monthly charges. Our Visa is set up as a liability account. I usually enter the receipts as manual checks in Accounts Payable, debiting the Visa account and crediting the expense account. With no expense account to credit, I am confused as to how to enter this redemption into PowerChurch. Please help!

[NeilZ]

I have a different scenario regarding the rewards redemption since my post in 2017.

This last time I redeemed them, the only option I had available was to have the credit applied to our next statement. When that statement came, we actually wound up with a credit on our Visa account because the reward redemption was more than our monthly charges. Our Visa is set up as a liability account. I usually enter the receipts as manual checks in Accounts Payable, debiting the Visa account and crediting the expense account. With no expense account to credit, I am confused as to how to enter this redemption into PowerChurch. Please help!

Again, this is INCOME, so I would CREDIT Miscellaneous Income and DEBIT the Liability account. This will be adding a 'negative' number to the liability.

Say the reward was 40.00, the DEBIT would put -40.00 in the liability, and 40.00 in miscellaneous income.
Someone spends 50.00 the liability account will reflect that only $10 of church funds was actually spent.

If you need some support for this. DO a backup of the accounting files, enter the transaction in Funds Accounting and post it. Then run the Balance Sheet, and the Income & Expense report they should reflect that the system is in balance, and that you see $40 in funds the church can spend.

Does this help?

[lauragilbert]

In the world of credit card auto pay things can get confusing.

On the day my card was due a credit came in for a refund for a past Women's Retreat Deposit in the amount of $840
My entire credit card bill was $846. Because this resulted in a credit no money was withdrawn for the month.

We have PC set up as a split checking account. One side is expenses and one side funds.
01-1110-000
02-1110-200
I completely understand debiting the fund side of checking in order to credit back the Women's ministry fund. But what on earth do I do with the rest of the expenses on that credit card that will not show for the month??
There are a lot of recurring subscriptions and postal items that need reflected in their proper accounts.

I have no idea how to set this up in order to make it show in bank rec and reflect properly this month.