How do I allocate a portion of salary costs to a project and the balance as an office expense? Entire salary cost appears in project when using weekly time sheet.

Hi @MCCM ,

Projects are simply a way of classifying information for reporting purposes.  If you want to see some reporting that allocates a portion to Projects and another portion to Office Expenses, you would have to enter the time that way in your weekly timesheet.  For example, if John Doe is working 8 hours a day, but you only want 60% to be allocated to Projects, and 40% to be allocated to Office Expenses, you would have to create another project called Office Expenses.  You would create one line on the weekly timesheet with the Project name, and only 4.8 hours each day (assuming 8 hour days).  You would create a second line indicating the Office Expense project, and allocate the remaining 3.2 hours to that project.

You can then pull a report on both projects.  But to be clear, this does not affect your G/L reporting.  The amount you have allocated to a project called 'Office Expenses' will not go to the account called 'Office Expenses' on your G/L, but rather it will be posted to 'Salaries' as it should be.

Hope that helps.

Hi there,

Making sure you're recording your transactions the right way is a good exercise for preventing errors in your books. 

I recommend contacting an accounting professional to get more info on this. If you're not in contact with one, I encourage you to search for one on our website using this link here. Doing this will help prevent any future discrepancies. Let me know if you have other questions. I'm here to help.

In the meantime, check out this helpful article related to Projects in QuickBooks: Track income, costs, and profitability by project.

Thank you for your detailed response. What we are having concern with is that the entire pay cheque amount is showing up as an expense on the project even though only a portion of the expense is allocated to the project in the weekly time sheet. If for instance, no costs are allocated to a project in any given pay period, then the entire salary pay cost is transferred as an expense to the company. Why is the balance of the salary cost not transferred as an expense to the company when only a portion of the salary cost is allocated to a project. The labour costs represented in the project module are not accurate which is why we believe we are entering the weekly time sheets incorrectly. The only Labour Type option for entering time for a salaried employee is through 'Salary' on the drop down menu but the entire pay amount is being allocated to the project. Also, going back into the weekly time sheets and editing the time entries for a project does not change the labour costs for  a project on the summary project page.

Any help is appreciated.

You are having this issue likely because you are entering the time activity after running payroll. If this is the case, to get the proper results, enter the time activity first, then run payroll. The payroll expense is split based on timesheet, which is entered in hours per day with no regard to salaried or hourly pay item.

How do you balance the total cost of payroll compared to the rate and hours worked? When you have a fixed paycheque net, in my case for the owner but they want to see hours worked and a particular rate

Hi there Tim,

Thank you for reaching out here. It's important that you are able to balance the cost of payroll and hours worked so that your employees are paid correctly. QuickBooks Online Payroll is a great tool to use, it helps get your employees paid on time for the hours they've worked. I can provide some information about comparing the hours worked, rates and payroll cost.

If your employees are on a fixed salary for either the week, the month or the year, there won't be any hourly wage associated with the payroll. If you'd like to see an hourly rate for the employees that are set up with a salary, I recommend leaving feedback by navigating to Gear icon and selecting the Feedback option. These comments are considered by our engineers when they develop new features for QuickBooks.

If you have any other questions, feel free to reach out here.