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Level 1

Questions about reconciling money deposited for client equipment

Hi Everyone,

 

I own a small IT consulting business. I had a client pay me on an invoice for both :

 

a) the equipment to get the job done (computers, switches, etc.) from Amazon

b) the cost of labor for myself and my contractors

 

He paid me everything up front and I paid myself and my contractors (via checks) and paid for the equipment with my business debit card which is traceable in Quickbooks.

 

My question here is, do I mark that lump sum paid to me as Sales? Or do I categorize the sales paid for services and the equipment separately?

 

Thank you for your time!

 

 

 

 

Solved
Best answer 02-26-2018

Accepted Solutions
Highlighted
Level 7

Re: Questions reconciling money deposited for client equipment

Hi Corbinhobbswi,

 

I would have two income accounts set up - one for the service provided (i.e. consulting) and one for materials. This way this means that when you run a Profit and Loss at the end of the financial year this will allow you to show a clear breakdown and percentage of where your revenue streams are the strongest. It may also help you make comparisons period by period and be able to make executive decisions in regards to improving a certiain revenue stream that maybe isnt doing as well as another. 

 

In this scenario you can use the split button to apportion part of the income to the service and part of the income to the materials.

 

I always say to my clients that QuickBooks reports are only as good as the information you enter into them. This may take a little longer for each transaction but the data you can extract at the end is priceless in decision making scenarios in the future!

 

I hope this helps.

 

If you have any questions please do not hesitate to private message me.

 

Kind Regards,

 

Emily Mockett

View solution in original post

3 Comments
ProAdvisor

Re: Questions reconciling money deposited for client equipment

Did you quote the customer and they paid you?   You could use the quote and make it into an invoice.  If you didn’t bill it out that way, you can just create an item and call it sales.  If the materials are taxable, then you need to consider that in the invoice.  

 

Here is a good detailed answer from qbteachmt which is old but also applies.  You use bundles in qbo instead of grouped items.  

Highlighted
Level 7

Re: Questions reconciling money deposited for client equipment

Hi Corbinhobbswi,

 

I would have two income accounts set up - one for the service provided (i.e. consulting) and one for materials. This way this means that when you run a Profit and Loss at the end of the financial year this will allow you to show a clear breakdown and percentage of where your revenue streams are the strongest. It may also help you make comparisons period by period and be able to make executive decisions in regards to improving a certiain revenue stream that maybe isnt doing as well as another. 

 

In this scenario you can use the split button to apportion part of the income to the service and part of the income to the materials.

 

I always say to my clients that QuickBooks reports are only as good as the information you enter into them. This may take a little longer for each transaction but the data you can extract at the end is priceless in decision making scenarios in the future!

 

I hope this helps.

 

If you have any questions please do not hesitate to private message me.

 

Kind Regards,

 

Emily Mockett

View solution in original post

Level 7

Re: Questions reconciling money deposited for client equipment

Hi @corbinhobbswi - welcome to QB Community! LOL, how much do we love getting paid in full and on time? 

 

Did you find @lynda's and @EmilyMockett's suggestions helpful?

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