We are a software reseller (on Quickbooks desktop Pro 2018 on Accrual) and I'm trying to find out how to reconcile vendor bills when our customers pay the vendor directly instead of us.
When we make sales to our customers we place an order on the customer's behalf with our vendor and the vendor provides the software directly to our customer. We get a bill from our vendor, and we issue an invoice for the gross sale total to our customer. Our customers are instructed to submit their payment directly to our vendor. When our vendor receives our customer's payment, our vendor sends a payment directly to us for our proceeds on the sale. So the only amount that ever hits our account is the difference between our invoice total to the customer and the bill total from our vendor.
This is causing problems because our company receives the bill even though we are not expected to be the ones submitting the payment to the vendor. And, we have an invoice for the full sales amount recorded in QB to the customer even though we will not be receiving that full amount. We need to keep the invoice total as the full total for tax reasons.
Another bookkeeper told me that I just record the bill's as usual and the customer invoices as usual, but then when we receive payment from the vendor to add a second line on the deposit that credits back those COGS (amount vendor billed) so that the deposit amount matches the proceeds we received. However when I do this, on the P&L it ends up duplicating the COGS because the Bill is listed for the COGs and then the deposit discount shows up for those same COGS.
What do I do!? *Pulling my hair out*
It's a pleasure to have you join us here in the Community. I'm here with some insight to provide that can help get you on the right track
Based on the situation you've mentioned, you could either record a barter or consignment sales transaction to apply your customer's payment to the vendor's bill. Not only will this let you keep the invoice total for tax reasons, but it'll also reflect the difference between the invoice and bill totals.
Overall, when you check a report, such as Profit & Loss, you should be able to see the correct details. However, while it does this, it'll still show that you received the payment, minus the amount that you paid to your vendor.
That being said, please be sure to reach out to an accounting consultant to ensure this method is the best suit for your business. With Intuit's Find-A-ProAdvisor site, you can search for certified professionals in proximity to your ZIP code that can discuss options more personal to your business's needs.
Please let me know if there's anything else I can do to help you succeed with QuickBooks. Thanks for reaching out, wishing you all the best.