If you don't have an account to track the discounts, then I would set one up in the revenue section and link it under Early Payment Sales Discount.

Because the bank account is already being affected by using a discount (reducing or crediting the amount of money received) and because the discount will post a debit to the linked account, if you use the bank, then you will increase the amount of money received by the same amount...I think, I've never tried it.  You are really trying to reduce your sales amount by giving the discount.

You are right, there is already a lesser amount going into the system than stated on the original invoice............so on that tack I would probably link it to Accounts Receivable (Account Code 1200) because then it will reduce the sales amount?  

You are right, there is already a lesser amount going into the system than stated on the original invoice............so on that tack I would probably link it to Accounts Receivable (Account Code 1200) because then it will reduce the sales amount?  

I've never considered linking it to A/R so I don't know what would happen.  I assume you can't even link it there.  I would still do as I suggested.  It's what I do and that works for me.

When you go into the linked accounts for AR do you not see a section there that says 'Early Payment Sales Discount' along with 'Principal Bank Account' and 'Accounts Receivable'? If not then let us know as that would suggest you are using a different software edition or something is wrong. If you do see that section then as per Richard that is where you should enter the G/L code for this. If you don't have a G/L 4000 code for this then create it and use that number to link to Early pmt sales discount.

Yes I do see both of those.   So basically I create a 4000 code named Early Payment Sales Discount and then go into the linked account screen and alongside "Early Payment Sales Discount" put in the account code I have created?   I actually thought to do it this way, but was unsure in case I had to put in the bank or a/r code.

yes, that is correct, the G/L code should be in the 4000 range. Once you have entered that then when you go into the receipt module you will be able to enter the difference in the discount taken column. This will Debit your bank, Debit your Early Pmt account, and Credit your A/R.

Thanks to everyone for their input............I should just have gone with my gut instinct in the first place but I didn't want to make a mistake.   At my old company the CFO always did these entries and set ups so this is all new to me.

I was fine with all this until I went to enter it and it asked me for a GIFI code.............where would I get that from?

You would get them from the CRA website

www.cra-arc.gc.ca/.../menu-eng.html

While technically Bruce's answer is correct, if you don't do your own income tax returns, you don't need it.  GIFI codes have been in the system most of this century or longer and I have yet to put one in a file for the use of it's intended purpose.