Transaction reports are preferred by accounting departments over Sales Reports
as the true per-month/time period income and expenditure are reported.
For example, lets say that in December you sold $100,000 of orders. Then in January you processed $5000 worth of returns.
|Product Profit and Sales Reports
|| Transaction Reports
| Applies returns of (5000) to the orders, and recalculates P&L of December to sales of $95,000
|| Retains the $100,000 of for calculating P&L of December, and adds ($5000) to the month of January
Transactions are identified by 2 types:
||Increases an asset or expense account, or decreases a liability or equity account
|| Increases a liability or equity account, or decreases an asset or expense account
|| Payment, Fees, Item Cost
||Sales Refund, Fee Refund
Important: Debits and credits can have both positive and negative values depending on the type of account they are impacting:
- Positive Debit - Customer payment to you debits, or increases, your bank account.
- Negative Debit - Your payment to a channel debits, or increases, your accounts payable account.
- Positive Credit - Refunding a customer credits, or decreases, your bank account.
- Negative Credit - Getting a refund from the channel credits, or decreases, your accounts payable account.