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How to Record Amazon Settlement Data in QuickBooks and Prepare for Reconciliation
How to Record Amazon Settlement Data in QuickBooks and Prepare for Reconciliation

Learn how to prepare QuickBooks for Amazon orders and fees.

Webgility Help Center avatar
Written by Webgility Help Center
Updated over a week ago

Create a temporary Clearing account in QuickBooks. The purpose of a clearing account is to facilitate the reconciliation of your bank account with your bank statement. Directly depositing daily revenue into your bank account could complicate reconciliation, as matching sales within that time interval against the lump sum becomes challenging. Therefore, we recommend creating a temporary clearing account to post transactions and subsequently making a transfer entry to your bank account.

Preparing QuickBooks for Amazon Orders & Fees

Create the following in QuickBooks:

  • A Bank Account: Account Name Amazon Clearing. This clearing account, also known as a holding account, functions as a virtual bank account designed to hold Amazon revenue until the funds are disbursed to your actual bank account.

  • An Expense Account: Name the Account Amazon Expense and Fess We need an expense account to accurately track Amazon expenses and fees in QuickBooks.

  • Create a new Vendor in QuickBooks: Name it Amazon Vendor

Configure Webgility for downloading and posting orders and settlements in QuickBooks

Daily downloading and posting orders into QuickBooks

Refer to the following article for instructions on downloading orders in Webgility. How to Download Orders in Webgility Desktop

Refer to the following article for guidance on posting orders in your accounting software. How to Post Orders to Your Accounting

Posting Amazon expenses and fees into QuickBooks

Every two weeks, Amazon issues a settlement report containing various financial transactions, including product sales, fees, and other charges. Following the deduction of fees and expenses, Amazon transfers the remaining funds to the seller's account. Below is the screenshot of the Settlement report from Amazon.

Refer to the help article for instructions on downloading and posting expenses and fees in QuickBooks Download and Post Amazon Settlement Reports with Webgility Desktop

Transferring funds from Amazon clearing account to bank account

After posting the settlement report in QuickBooks, Webgility will record the payment transactions in the Amazon Clearing account

When Amazon expenses and fees are posted to QuickBooks:

  • Debit the expense account (increase).

  • Credit the clearing/hold account for the value that Amazon has charged for the expenses and fees (decrease).

When Amazon deposits the transfer amount into your bank account, you should create a transfer funds transaction in QuickBooks by navigating to Banking > Transfer Funds. The date of transfer should be the Deposit date.

Note: The date and transfer amount should match the transfer amount (closing balance), in the Amazon settlement report.

Clearing account wrap-up

Master equation: Total revenue - $ deposited by Amazon - expenses and fees charged by Amazon = $0

This is why this is called a clearing account.

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