What are the differences in the accounting types in Firefly Reservations?
Last Updated: October 8, 2024
Link to Feature: https://app.fireflyreservations.com/Accounting/Settings (or click here)
Cash Accounting: revenue/taxes are recognized on payment date based on what was paid regardless of when the customer's reservation is for.
- For example, if a customer makes a reservation on December 1st to stay from July 1st - 4th and pays $50, that $50 is recognized as revenue/tax on December 1st.
Hybrid Accounting: revenue/taxes are recognized on reservation arrival date based on what has been paid. Payments made before the arrival date are held in a Deposits account (as a liability). Any payments made on the arrival date are recognized in full that day, and any payments made after the arrival date are recognized on the day they are paid.
- For example, if a customer makes a reservation on December 1st to stay from July 1st - 4th and pays $50, that $50 is held as a deposit until July 1st on which date the full $50 is recognized as revenue/tax. If they still owe $100, and pay that a day late on July 2nd, that $100 is recognized as revenue/tax on July 2nd.
Accrual Accounting: revenue/tax are recognized at a daily pro-rated amount for the duration of the stay regardless of whether payment has been made against the charge. Revenue is recognized during their stay and is held until then in the Deferred Revenue account. Making a payment towards a charge offsets the Accounts Receivable account (which shows how much money the park is owed).
- For example, if a customer makes a reservation on December 1st to stay from July 1st – 4th which costs a total of $150 and pays $50 as a deposit, the Accounts Receivable will hold the $100 that is still owing. Revenue/tax will be recognized as follows:
- July 1st: $50 to revenue/tax
- July 2nd: $50 to revenue/tax
- July 3rd: $50 to revenue/tax
If they make a payment of $100 upon arrival, the Accounts Receivable will be cleared of that $100 (as they no longer owe it), but revenue will still be recognized on a pro-rated daily basis.
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