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PARKSG
Level 2

How I split/record income for our invoice and for the 3rd party

Dear all, I am a new user of Quick Book. (In the demo version), I uploaded the bank CSV file and doing editing, let's say I've received 26,034.21USD from my client btw I should pay for 2,657.11USD to another supplier which is working with my company. My client deposited all together. The 23,397.10USD is for an invoice issued by us and I've done matched with the created invoice and the 2,657.11USD is payable to the 3rd party. It's often a situation for me btw after changing the software to QB, I have no idea indeed. What I need to choose the [ACCOUNT] at the 'Bank Deposit' filed for the payable amount of 2,657.11USD even we received. And what will be indicated in the balance sheet? It's not our profit at all. A Kind of bypass btw the 3rd party will issue the invoice to receive it from us too. Please see my sample screen-captured attached. I will really appreciate your advice!  

Solved
Best answer July 13, 2021

Accepted Solutions
jamespaul
QuickBooks Team

How I split/record income for our invoice and for the 3rd party

Hello, PARKSG. 

 

Thanks for keeping in touch with the update. I'll ensure you're able to record those transactions properly. 

 

The reason why you cannot choose Undeposited Funds as your option is that the Bank deposit function is already affecting it.

 

The purpose of the function is move funds from the Undeposited Funds account to your bank, and it's also used to deposit the money to your bank account in QuickBooks. 

 

Now, let's go back to your original post and work out your invoices and payment to the third party company. 

 

Regarding the invoice, I take it that you haven't received a payment for it yet. In this case, create a payment transaction then deposit it to your Undeposited Funds account. Here's how: 

 

  1. Click the + New icon, then select Receive payment
  2. Under Customer, add the client's profile.
  3. Set the Payment date and method.
  4. Under Deposit to, select the Undeposited Funds account. 
  5. Check the invoice, then click Save and close to apply the payment. 

 

UDF1.PNG

 

Then, process the transactions through the Bank deposit feature: 

 

  1. Click the + New icon again, then select Bank deposit.
  2. Under Account, select the bank account where you want to deposit the money. 
  3. Go to the Select the payments included in this deposit section, then check the invoice payment.
  4. Under Add funds to this deposit, add the client's profile again on the Received From column.
  5. Select an account where you want to track the additional sales (it can be an income account). 
  6. Add the bank charge (like the one in your screenshot). 
  7. Click Save and close

 

UDF2.PNG

 

Now, you mentioned that you are being invoiced by the third-party. In this case, create a bill for their share. Click the + New icon, then select Bill. Process the bill payment afterwards when you're ready to pay them. 

 

The account you'll be using depends on how you would want to categorise the transaction. You can select an expense account, but I'd recommend consulting an account first so you'll be guided on what appropriate account to select. 

 

Finally, the Balance Sheet will show the correct transaction flow. You received a total of $26,034.21 to your bank, less the $2,657.11 that you paid to the third-party company: 

 

Balancesheet1.PNG

 

Another option to record your transactions is to use the Billable expense feature to manage the transactions easily. Turn it on from the Account and settings page: 

 

  1. Click the Gear icon, then select Account and settings.
  2. Go to the Expenses tab.
  3. Expand the Bills and expenses section.
  4. Toggle the Make expenses and items billable option to On.
  5. Click Save, then Done.

 

Before you do anything else, delete the previous invoice to record the transaction flow properly. Simply open it, click the More button then select Delete

 

deleteinv1.PNG

 

Next, create a bill for the third-party to record their share. Make sure to check the Billable box and map the client's profile to it: 

 

billableexp1.PNG

 

Second, create the invoice and add the amount of $23,397.10. You'll also be prompted to add the billable expense to the invoice:

 

billableexp2.PNG

 

Then, process an invoice payment for the entire amount, and deposit it to your Undeposited Funds account. 

 

Finally, create a Bank deposit transaction to add the bank charge fee altogether: 

 

billableexp3.PNG

 

When you're ready, record a bill payment to pay the third-party company for their share. 

 

After taking care of the transactions, I would recommend browsing our tutorials to help you learn the ropes in the program. Also if you need help with your reconciliation, feel free to use this article as a guide: Reconcile an account in QuickBooks Online.

 

Need to work on other areas in QuickBooks Online or do you need to take care of other transactions? Please let me know and I'll be with you in every step. 

View solution in original post

5 REPLIES 5
John C
QuickBooks Team

How I split/record income for our invoice and for the 3rd party

Hi PARKSG You'd have to receive payment on the invoice for the full amount and allocate it to the undeposited funds account, not your bank account > create a bank deposit > tick the box for the relevant invoice > ensure that the correct bank account and date of the amount your customer sent you the amount is entered > in the account column of the 'add finds to this deposit' section enter the fee/expense account relating to the 3rd paty > enter the amount as a minus figure > this should then give you the net amount that you received into your bank and you should be able to match the treansaction ( youwill have to initially undo the banking match before you do the above).

PARKSG
Level 2

How I split/record income for our invoice and for the 3rd party

@John C Hi John, thanks for your reply. Btw I am still cannot do it. I cannot choose the option as undeposited Funds at the Bank Deposit section. Don't know the reason... Please find my attached and could you give some more tips for the transaction? Thanks indeed! 

jamespaul
QuickBooks Team

How I split/record income for our invoice and for the 3rd party

Hello, PARKSG. 

 

Thanks for keeping in touch with the update. I'll ensure you're able to record those transactions properly. 

 

The reason why you cannot choose Undeposited Funds as your option is that the Bank deposit function is already affecting it.

 

The purpose of the function is move funds from the Undeposited Funds account to your bank, and it's also used to deposit the money to your bank account in QuickBooks. 

 

Now, let's go back to your original post and work out your invoices and payment to the third party company. 

 

Regarding the invoice, I take it that you haven't received a payment for it yet. In this case, create a payment transaction then deposit it to your Undeposited Funds account. Here's how: 

 

  1. Click the + New icon, then select Receive payment
  2. Under Customer, add the client's profile.
  3. Set the Payment date and method.
  4. Under Deposit to, select the Undeposited Funds account. 
  5. Check the invoice, then click Save and close to apply the payment. 

 

UDF1.PNG

 

Then, process the transactions through the Bank deposit feature: 

 

  1. Click the + New icon again, then select Bank deposit.
  2. Under Account, select the bank account where you want to deposit the money. 
  3. Go to the Select the payments included in this deposit section, then check the invoice payment.
  4. Under Add funds to this deposit, add the client's profile again on the Received From column.
  5. Select an account where you want to track the additional sales (it can be an income account). 
  6. Add the bank charge (like the one in your screenshot). 
  7. Click Save and close

 

UDF2.PNG

 

Now, you mentioned that you are being invoiced by the third-party. In this case, create a bill for their share. Click the + New icon, then select Bill. Process the bill payment afterwards when you're ready to pay them. 

 

The account you'll be using depends on how you would want to categorise the transaction. You can select an expense account, but I'd recommend consulting an account first so you'll be guided on what appropriate account to select. 

 

Finally, the Balance Sheet will show the correct transaction flow. You received a total of $26,034.21 to your bank, less the $2,657.11 that you paid to the third-party company: 

 

Balancesheet1.PNG

 

Another option to record your transactions is to use the Billable expense feature to manage the transactions easily. Turn it on from the Account and settings page: 

 

  1. Click the Gear icon, then select Account and settings.
  2. Go to the Expenses tab.
  3. Expand the Bills and expenses section.
  4. Toggle the Make expenses and items billable option to On.
  5. Click Save, then Done.

 

Before you do anything else, delete the previous invoice to record the transaction flow properly. Simply open it, click the More button then select Delete

 

deleteinv1.PNG

 

Next, create a bill for the third-party to record their share. Make sure to check the Billable box and map the client's profile to it: 

 

billableexp1.PNG

 

Second, create the invoice and add the amount of $23,397.10. You'll also be prompted to add the billable expense to the invoice:

 

billableexp2.PNG

 

Then, process an invoice payment for the entire amount, and deposit it to your Undeposited Funds account. 

 

Finally, create a Bank deposit transaction to add the bank charge fee altogether: 

 

billableexp3.PNG

 

When you're ready, record a bill payment to pay the third-party company for their share. 

 

After taking care of the transactions, I would recommend browsing our tutorials to help you learn the ropes in the program. Also if you need help with your reconciliation, feel free to use this article as a guide: Reconcile an account in QuickBooks Online.

 

Need to work on other areas in QuickBooks Online or do you need to take care of other transactions? Please let me know and I'll be with you in every step. 

View solution in original post

PARKSG
Level 2

How I split/record income for our invoice and for the 3rd party

Crystal Clear, thanks indeed!

jamespaul
QuickBooks Team

How I split/record income for our invoice and for the 3rd party

You're welcome, PARKSG!

 

Let me know if you have any other questions. I'm here to help.

 

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