How do i treat this transaction of buying an ideas from company say A to my company
Do you mean to classify these “ideas” as an Intangible Asset? In accounting, all of company wealth that are intangible should be treated as Intangible Assets, such as Copyrights, Patents, etc. If so, you should record them in the Intangible Assets account. If you haven’t activated the module yet, please do so through the Customize option located below the Settings menu.
Select the options Intangible Assets and Amortization Entries to enable them. For further details, you may refer to the guides here:
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Ooh thanks, it work
And why do i see some transaction in Retaining Earning like some salaries invetory items
Most of your transactions will appear in the Retained Earnings account - this is normal
but they are not retained earning, because. Retained earnings are the accumulated profits of a company that are kept and not distributed to shareholders as dividends. so how come i see salaries and other transaction in retained earning account, i this i did something wrong
You can click on all the numerical figures in the Chart of Account of the Summary section to view each transaction. Review every transaction to see which account you have entered it into. If the transaction is recorded in an income or expense account, it will certainly affect the Retained Earnings account.
When you record employee salary transactions, they are inevitably entered into the Salary Expense account, which will also affect the Retained Earnings account. This is because increases in Expense accounts will reduce Net Profit. Retained Earnings do not solely consist of profits not yet distributed to shareholders as dividends, but encompass the entire Net Profit for the current period and previous period. When you distribute a portion of the Net Profit to shareholders, you took it from the Retained Earnings account. And you certainly won’t distribute all of it, right? Some earnings are retained for the company’s operational needs. Therefore, every Net Profit earned is first recorded in the Retained Earnings account, whether before or after distribution to shareholders. Consequently, the Retained Earnings account is part of Equity, signifying the rights of the Business Owners or Shareholders.
so what am i suppose to do
Could you share your current situation when recording transactions in the manager? For instance, one of the transaction examples you mentioned earlier regarding salary. Let’s examine whether the steps you’ve taken are appropriate within the context of recording in this Manager app.
Is this transaction derived from the sale of goods?
It appears there is nothing wrong with the transaction you conducted. You sold goods, for instance, take BROKEN CASHEW NUTS as an example. If you sell it for 120,000 as indicated in the sales transaction. That amount of 120,000 will be recorded as sales revenue, and the the purchase price of goods when you acquire them as inventory items from the supplier will be recorded in the Expense account as Cost of Goods Sold (the amount corresponds to the purchase price you set in the inventory). The margin between the revenue and the cost of goods sold will naturally result in profit, and this profit will certainly affect Retained Earnings account as part of Equity.
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