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patcoppi
Level 2

How do I set up account to track employee's commissions-build up /reduce when paid. Cost must be charged to project to reduce profit. JE to increase/decrease?

 
4 Comments 4
patcoppi
Level 2

How do I set up account to track employee's commissions-build up /reduce when paid. Cost must be charged to project to reduce profit. JE to increase/decrease?

Commissions are paid from gross $ on project.  Would I do a JE - service item "commissions" to debit customer, and same to credit commissions account?  QB online "help" is so tedious to try to get an answer from, and not much help!  I know there's a way to do it because a previous employer was able to.  

MaryGraceS
Moderator

How do I set up account to track employee's commissions-build up /reduce when paid. Cost must be charged to project to reduce profit. JE to increase/decrease?

Hello there, @patcoppi.

 

Thank you for reaching out to the Community. Allow me to help share some insights about creating journal entries (JE). 

 

When you create a journal entry, you need to select in each distribution line an account from the Chart of Accounts. You can't use a service item for this transaction. 

 

You can create a check to pay the employee's commission and link it to the project. Let me show you how:

  1. At the top right, select the Plus icon.
  2. Select Check.
  3. From the Payee field, select the employee's name.
  4. Under Category details, select the account for the commission in the Category column. 
  5. Put a check in the BILLABLE column.
  6. In the CUSTOMER/PROJECT column, select the project.
  7. Enter other check details.
  8. Click Save and close.

I've attached some articles about Projects and journal entry for additional reference: 

That should get you back on track. Drop me a comment below if you have any other questions about Projects or JE. I'll be happy to help you out. Have a great day ahead. 

patcoppi
Level 2

How do I set up account to track employee's commissions-build up /reduce when paid. Cost must be charged to project to reduce profit. JE to increase/decrease?

Will this show as income for the employee at the end of the year?  It needs to go through payroll.

RaymondJayO
Moderator

How do I set up account to track employee's commissions-build up /reduce when paid. Cost must be charged to project to reduce profit. JE to increase/decrease?

Thanks for getting back to us, @patcoppi

 

I'll help add some information with tracking your employee's commissions and project costs. 

 

If you've already performed the steps provided by my colleague above and created paychecks, these will show as income on your employee's W-2. If these are regular checks, these will not appear on the form. 

 

Tracking your project labor costs is a two-part process. First, you'll need to calculate the hourly cost rate for each worker. Then, you’ll be able to add project timesheets using your hourly cost rates. Here's how to track your hourly time costs: 

 

  1. Go to Plus (+) at the upper right. 
  2. Select Weekly Timesheet.
  3. Select your worker and the week you’re entering time for from the drop-down menus.
  4. Select the project from the Choose a customer or project drop-down menu. This will tag the timesheet to the project.
  5. Fill out the timesheet
  6. You can check the Billable (/hr) and edit the billable rate (the price you’re charging your customers) if you plan to invoice your customer for specific project hours.

If you’re using TSheets, you can approve time in QuickBooks and import your timesheets directly into projects.

 

When you're ready, go to Workers and Select Employees tab. Then, you can run payroll for them. 

 

The steps above will help you track project costs and profits. You can check out this article for your useful reference: Track Income, Costs, and Profitability by Project

 

Keep in touch with me how it goes, @patcoppi. Rest assured, the Community will always have your back. Stay positive always!

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