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Community Contributor *

Question about COGS or Expense


Our company is doing a job.  We hire an outside payroll company to do the payroll for the Teamsters.  This company sends us an invoice for payment (this is the payroll for the employee and their processing fee).  We then invoice our client for the job.  Our invoice includes how much we paid the outside payroll company.  In quickbooks do I consider this invoice from the payroll company as a COGS to the job or an expense to the job.



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Re: Question about COGS or Expense

COGS is related to inventory cost when it is sold


the payment is an expense, you can if you wish create a COGS type account called COS, cost of sales and use that.


COGS is an expense account it is just treated special because of the inventory aspect and tax reporting