Sales Categories

Sales categories are the lines your daily sales are entered by, such as Grocery, Beer and Wine, Tobacco or Lottery. The Windows app called them departments. Each category says whether its sales are taxable and at what rate, how much of them is income of the business, and which ledger account they go to. Purchase categories group what you buy.

Menu	Books > Sales categories; Books > Sales tax exemptions
Permission	The Sales category and Sales tax exemption content permissions, such as List Sales category content items and Edit Sales category for others
Feature	Sales categories

Can't find it?

What you see depends on your role. If the menu, a button or a setting on this page is missing, ask your administrator to give you the permission listed above or to turn on the feature. Only administrators can turn features on and change site settings.

The category list

Open Books > Sales categories. Each category shows its kind (Retail, Service or Purchase) and badges for what is special about it: Taxable 6%, Subtracted, Revenue 5% when only part of the sales is income, the category it is merged into, System and Inactive.

Every business has the Sales Tax category, for the sales tax collected with the daily sales; it goes to the Sales Tax Payable account. The rest of the list depends on how the business was set up:

• A convenience store starts with Grocery, Food, Beer and wine, Liquor, Tobacco, Lottery (5% revenue share), Lottery payouts, an Inventory purchase category, and the system categories Deposit (container deposits collected) and Bottle Refund (deposits refunded; always subtracted).
• A service business starts with Labor, Parts and materials, and a Materials purchase category.

These are starting points: rename, change, retire or add categories to match your business.

The System categories (Sales Tax, Deposit and Bottle Refund) are special. You can rename a system category, move it, and change its revenue share, its account and whether it is in the financial statements. Its sales tax treatment is fixed, it stays active, and it cannot be deleted: the page says it is a system sales category and cannot be deleted.

Add a sales category

1. Select New Sales category.
2. Enter the Name and choose the Kind:
   • Retail and Service categories are on the sales screens;
   • Purchase categories are only on the purchases screen.
3. Choose the Account its amounts go to: usually Sales or another income account for sales, Purchases or an expense account for purchases.
4. Enter the Revenue share (%): 100 for most categories; for lottery, money orders or other sales you collect for someone else, the commission you keep.
5. Under Sales tax:
   • Check Taxable and enter the Tax rate (%) as a percentage, such as 6 for 6%.
   • For a non-taxable category on the sales tax return, choose why it is Exempt because, such as Food for human consumption or Resale. The return deducts exempt sales by reason. The reasons are listed under Sales tax exemptions.
   • Check Always subtracted for payouts and refunds. Such a category is never taxable.
   • Clear On the sales tax return or In the financial statements for categories that do not belong there, such as gift card sales.
6. For a retail category you also buy goods for, check Also on the purchases screen.
7. Optionally enter a Position: lower numbers come first on entry screens.
8. Select Publish.

Entry screens list the categories by position and name, then Deposit, Bottle Refund, the subtracted categories, and Sales Tax last, as in the Windows app.

Sales tax exemptions

The reasons a non-taxable category can be exempt are a list of their own, under Books > Sales tax exemptions, because they differ from state to state. A business set up for Michigan starts with the deduction lines of the Michigan sales and use tax return (5080 lines 5a to 5k), such as 5g · Food for human consumption.

To add a reason, select New Sales tax exemption, enter its Name and, optionally, the Return line its sales are deducted on, and select Publish. Clear Active to stop offering a reason. Each reason is listed with its return line.

Merge categories for reports

To report several detailed categories under one, such as Beer and Wine under Alcohol, open each detailed category and choose the parent in Merged into. Reports then show their totals under the parent. A category can only be merged into one of the same kind that is not merged itself, and a category others are merged into cannot be merged.

Change or retire a category

Select Edit, change it and select Publish. Clear Active to stop offering a category on entry screens. A category others are merged into cannot be deleted until you unmerge them.

Message	What to do
A taxable category needs a tax rate above 0 and at most 100 percent.	Enter the rate as a percentage, such as 6.
Choose why the sales are exempt; the sales tax return deducts them by reason.	Choose a reason in Exempt because, or clear On the sales tax return.
The revenue share is between 0 and 100 percent.	Enter a share from 0 to 100.
Another sales category already has this name.	Choose another name.

See also Chart of accounts.