FAQ: What is the difference between a sale and a transaction?

You may notice discrepancies between the number of sales recorded in the All Sales Report and the number of transactions recorded in the All Transactions Summary Report. This occurs because a transaction is only recorded as a sale if it is considered to be revenue. Whether a transaction is considered revenue or not is dependent on the accounting method filter used when viewing the All Sales Report. The default filter is the accrual method. Using this method, transactions are considered as sales when the money is earned by your business.

For example:

If a client adds $100 to their account balance, this will be recorded as a transaction and displayed in the All Transactions Summary Report, but it will not be recorded as a sale until the client uses their account balance to purchase goods or services. If the client spends a part of the $100 they added to their account balance to pay for a $20 appointment, that $20 will then be recorded as both a sale and a transaction and will be displayed in the All Sales Report and the All Transactions Summary Report.

Similarly, if a client purchases a $20 gift card, the purchase will be recorded as a transaction, but until the gift card is used to purchase goods or services, the $20 will not be considered revenue and will not be recorded as a sale.

If you want to view these types of transactions as sales when money is received by your business rather than when it is earned (i.e., when a client adds money to their account balance or purchases a gift card rather than when they use their account balance or gift card to purchase goods or services) then you can choose to filter the All Sales Report by the cash account method. For more information, see FAQ: What is the difference between accrual and cash-based accounting?

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