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Level 2

How to get report for Cost of Good Sold by Client (service business)

Our P&L report for year end 2018 accurately shows the results for the year including the cost of goods sold which is primarily vendor fees we pay for servicing our closed captioning clients (e.g., universities). 

 

However when I customize the "last year" P&L report for a client, the total sales to the client is accurate, but the cost of goods sold (i.e., the total vendor payments paid to support that client), are not displayed -- expenses are left blank.   The product is QB Plus which I believe should allow for this relatively simple calculation.  Thanks in advance ..... TerryGH

Solved
Best answer January 27, 2019

Best Answers
Level 15

How to get report for Cost of Good Sold by Client (service business)

@Kristine Mae

 

Please Learn from the input here. COGS has nothing to do with Customer Balances. It has to do with if what was sold was Tracked as a purchase for that customer name; or if what was Sold was inventory, which carries its own COGS with it from Inventory asset.

 

@TerryGH

 

Let's try this again, because I provided the answer you needed. Your Source data needs to be Job Tracked = assigned that it relates to that customer, or there is no Cost associated for that Customer Name. You should be using QB Online Plus for this, by the way.

 

"but my client's situation is different in that each vendor/contractor/captioner submits their time and costs to the owner, who then has his staff generate an invoice for each client with any any captioner's time and billing for that client for the monthly or whatever time period."

 

The Purchase data needs to be Assigned. You can do that Before or After charging the customer, but it is easiest if you use the functions of this relational database by entering the Cost or Purchase event and Billable status to the customer. If you want to do it out of sequence, you manually make the charges, but you still need to Job Track the purchase for showing this direct expense is related directly to that customer. You would mark them Not Billable in this case, since you did that part manually and previously.

 

"And each captioner's time is coded with one of the CGS type codes that QBO provides"

 

You need to use at the least one Service Item. Using the Accounts manually isn't going to give you that direct Relationship. You want to see, for instance:

Graphic Artist $50 and hour for 5 hours for Smith and Sold to Smith 5 hours of Graphic Artist for $100. And now you see Income of $500 and COGS of $250 and Profit or $250. That's why you use Two Sided Services for this. You can make one and use it somewhate generically, such as Outsourced Services. Or, some clarity for you, such as Landscaping vs Structural Engineer vs Surveyor, for a Property development firm working on your ranch construction project.

 

"so there is no overlap e.g., while a captioner might well work on another client's project"

Yes, I would list it as follows on the Check to pay the Landscaper:

Landscaper Service item $500 Smith project, Billable (or not)

Landscaper Service item $1,000 Jones project, Billable (or not)

= $1,500 I just paid to the Landscaper Provider. And now I have Direct and Actual COGS for these two projects.

 

"his/her time is tracked in the invoice for the applicable client"

 

That's Sales. That's Revenue.

 

Go back to the Purchase entries and Assign them.

 

So what confuses me as an old database guy is why for the company's P&L report it shows the correct CGS totals, why when the P&L report is customized for a specific client it shows the correct sales but the CGS numbers are not shown -- the line for Expenses is just blank."

 

It has to have the cross-reference of Customer Name on it.

 

"Any other thoughts will be appreciated ."

 

It's the same answer I already gave. You can learn how to use it from the sample file, even.

 

I have attached an image for Law Firm retainers, which is a similar concept = Tracked the Customer Details for the split details as the Product/Service, to show I need this to be Assigned to them for reporting.

 

And you can then compare the P&L for one customer to the report that is Customer Income (a Net report).

View solution in original post

8 Comments
Level 15

How to get report for Cost of Good Sold by Client (service business)

For this: "the total vendor payments paid to support that client"

 

One every purchase transaction, did you list your Two Sided Service item, allocate the Split amounts per Client being served? That would also be the point at which you get to mark it Billable. Example:

I pay a hosting provider for hosting 4 (3 are clients') websites. I list this on the Purchase:

Hosting package $100 Smith Billable

Hosting package $100 Jones Billable

Hosting package Unlimited Plan $500 Doe Billable

For Expense, not Item: Hosting Package (my own site) $50 not Job tracked

= $750 each purchase I enter

 

The Service item it for Customers is linked to COGS and to Revenue.

 

Now I invoice you for your billable item.

 

Now I have Customer Profit, Item Profit, and P&L by Customer has the Tracked Cost item flowing to COGS.

Level 2

How to get report for Cost of Good Sold by Client (service business)

-- duplicate reply it seems -- deleted

Level 2

How to get report for Cost of Good Sold by Client (service business)

I just posted a lengthy reply that was lost, so need to keep this short - first and foremost thanks, QBteachmt -- but my client's situation is different in that each vendor/contractor/captioner submits their time and costs to the owner, who then has his staff generate an invoice for each client with any any captioner's time and billing for that client for the monthly or whatever time period.  And each captioner's time is coded with one of the CGS type codes that QBO provides, so there is no overlap e.g., while a captioner might well work on another client's project, his/her time is tracked in the invoice for the applicable client -- hope that makes sense.

    So what confuses me as an old database guy is why for the company's P&L report it shows the correct CGS totals, why when the P&L report is customized for a specific client it shows the correct sales but the CGS numbers are not shown -- the line for Expenses is just blank.   Any other thoughts will be appreciated ...

 

Level 2

How to get report for Cost of Good Sold by Client (service business)

Going to try this again -- a second time the reply was lost ... at least I saved the last one....

 

I just posted a lengthy reply that was lost, so need to keep this short - first and foremost thanks, QBteachmt -- but my client's situation is different in that each vendor/contractor/captioner submits their time and costs to the owner, who then has his staff generate an invoice for each client with any any captioner's time and billing for that client for the monthly or whatever time period.  And each captioner's time is coded with one of the CGS type codes that QBO provides, so there is no overlap e.g., while a captioner might well work on another client's project, his/her time is tracked in the invoice for the applicable client -- hope that makes sense.

    So what confuses me as an old database guy is why for the company's P&L report it shows the correct CGS totals, why when the P&L report is customized for a specific client it shows the correct sales but the CGS numbers are not shown -- the line for Expenses is just blank.   Any other thoughts will be appreciated ...

QuickBooks Team

How to get report for Cost of Good Sold by Client (service business)

Hello there, TerryGH.

 

I've replicated your concern and saw some of the customers has zero amount under Cost of Goods Sold. Some of them have amounts. I've dug further and found out that if it's zero, it means they no longer have balances. You can click on the amount to open the Transaction report

 

You can refer to the screenshots below.

 

 

 

 

Let me know if you have additional questions by leaving a comment below. Have a great day!

 

Level 15

How to get report for Cost of Good Sold by Client (service business)

@Kristine Mae

 

Please Learn from the input here. COGS has nothing to do with Customer Balances. It has to do with if what was sold was Tracked as a purchase for that customer name; or if what was Sold was inventory, which carries its own COGS with it from Inventory asset.

 

@TerryGH

 

Let's try this again, because I provided the answer you needed. Your Source data needs to be Job Tracked = assigned that it relates to that customer, or there is no Cost associated for that Customer Name. You should be using QB Online Plus for this, by the way.

 

"but my client's situation is different in that each vendor/contractor/captioner submits their time and costs to the owner, who then has his staff generate an invoice for each client with any any captioner's time and billing for that client for the monthly or whatever time period."

 

The Purchase data needs to be Assigned. You can do that Before or After charging the customer, but it is easiest if you use the functions of this relational database by entering the Cost or Purchase event and Billable status to the customer. If you want to do it out of sequence, you manually make the charges, but you still need to Job Track the purchase for showing this direct expense is related directly to that customer. You would mark them Not Billable in this case, since you did that part manually and previously.

 

"And each captioner's time is coded with one of the CGS type codes that QBO provides"

 

You need to use at the least one Service Item. Using the Accounts manually isn't going to give you that direct Relationship. You want to see, for instance:

Graphic Artist $50 and hour for 5 hours for Smith and Sold to Smith 5 hours of Graphic Artist for $100. And now you see Income of $500 and COGS of $250 and Profit or $250. That's why you use Two Sided Services for this. You can make one and use it somewhate generically, such as Outsourced Services. Or, some clarity for you, such as Landscaping vs Structural Engineer vs Surveyor, for a Property development firm working on your ranch construction project.

 

"so there is no overlap e.g., while a captioner might well work on another client's project"

Yes, I would list it as follows on the Check to pay the Landscaper:

Landscaper Service item $500 Smith project, Billable (or not)

Landscaper Service item $1,000 Jones project, Billable (or not)

= $1,500 I just paid to the Landscaper Provider. And now I have Direct and Actual COGS for these two projects.

 

"his/her time is tracked in the invoice for the applicable client"

 

That's Sales. That's Revenue.

 

Go back to the Purchase entries and Assign them.

 

So what confuses me as an old database guy is why for the company's P&L report it shows the correct CGS totals, why when the P&L report is customized for a specific client it shows the correct sales but the CGS numbers are not shown -- the line for Expenses is just blank."

 

It has to have the cross-reference of Customer Name on it.

 

"Any other thoughts will be appreciated ."

 

It's the same answer I already gave. You can learn how to use it from the sample file, even.

 

I have attached an image for Law Firm retainers, which is a similar concept = Tracked the Customer Details for the split details as the Product/Service, to show I need this to be Assigned to them for reporting.

 

And you can then compare the P&L for one customer to the report that is Customer Income (a Net report).

View solution in original post

Level 2

How to get report for Cost of Good Sold by Client (service business)

First and foremost thanks to both QBteachmt (QBt) and Kristine Mae for the time they put in to reply, and attempt to help me find answers.

 

At the risk of angering QBt, Kristine's reply basically answered my question as to why the filter on the P&L reports by client did not generate CGS data for the client selected -- I didn't even think to check the  underlying Transaction Data for the company's P&L report, and of course discovered that as it is laid out now, the vendor data is not assigned to specific clients for this report.

 

And my hat tip to QBt for his patience and skill in responding to my initial question and reply -- even though I still have not had time to fully digest his post, I do understand, in conjunction with Kristine's post, why I am unable to generate "easily" the CGS data for the client specific reports. 

 

I think (and that is a big guess at this point) -- but I think I follow what QBt is suggesting as the way to do what I was trying to do, but will have to digest this a bit more, and determine if the time to make this happen is worthwhile since this is the first time in using QB Online Plus in 4+ years that it even came up as something we wanted to do. So I am going to market QBt's last reply as a "Solution" and will return with more intelligent questions if we take the next step.  Thanks again to you both  .... TGH

Level 15

How to get report for Cost of Good Sold by Client (service business)

You see the field for assigning that a Purchase is directly related to the customer, on the check expense, bill and credit card charge entry, which is called Job Tracking = you just assigned that cost. That's how P&L by Custome, P&l for one Customer Filter, and Customer Income summary reporting all get their Direct Cost  data = you need to assign it on the entry when that purchase is made that is Direct. Example: I enter that I just bought doors and windows for your garage. Even if I charge you a Fixed Contract Fee as my revenue, I also Track those purchases as related to your project. Now I have COGS data for You.

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