Paypal and Cash Base accounting

What entry should I make for Paypal sales receipts when transfering money to bank account?

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I have cash basis accounting system and I'm not VAT registered.

Some of my clients pay by Paypal. How to deal with the following scenario:

- one client pays on Monday 21st

- two other pay on Wednesday 23rd

- another two pay on Sunday 27th

- I will transfer money to bank account on Monday 28th

Will it be OK if I enter to my spreadsheet a total transferred on 28th as a sale/income dated 27th or I need to post each single Paypal transaction separately?

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Danny Kent
By Viciuno
21st Jun 2021 22:10

Paypal is just another bank account. Enter individual transactions. If you use your method the income will not only be out of sync but it will artificially suppress your turnover as well (as these payments will be net of fees/ whatever else you buy from paypal).

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By SXGuy
22nd Jun 2021 06:34

You record the full sale amount regardless of when you transfer your money. Transfers have nothing to do with it.

You then record the PayPal fees as an expense.

What your left with is your gross profit.

It shouldn't be hard to know what you've sold and for how much. Before fees. If it is I'd suggest changing the way you record income.

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Replying to SXGuy:
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By Roca
22nd Jun 2021 22:08

It is not hard to find details as everything is included in Paypal reports. I was just thinking about saving time on recording transactions in my P&L spreadsheet.

Will it be OK to enter daily totals of sale receipts as income and then relating Paypal fees as expense?

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