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Holly31
Level 3

Customer Terms

My client is a contractor and works on large construction contracts as a sub.  The owner or general contractor only pay invoices on a prescribed contractual date each month like the 20th or the 25th or whatever is in the contract.  

 

So the "terms" functionality doesn't work for us.  Unless there is some trick that I don't know.  They often send bills out early because of the time it takes to invoice (AIA) and volume.  So I cannot use 30d or any other fixed days.  How do we make this work?

Solved
Best answer August 27, 2020

Best Answers
MarsStephanieL
QuickBooks Team

Customer Terms

Hi there, @Holly31.

 

In QuickBooks, we use Estimates and Progress Invoicing to complete this task. This way, you can create and break down the cost of an estimate into many invoices needed for partial payments on the work done. I'd be glad to show you how to do that. 

 

You can begin with turning on the Progress Invoicing feature, here's how:

 

  1. Go to the File menu and select Switch to Single-user mode.
  2. Navigate to the Edit menu and select Preferences.
  3. From the left menu, select Jobs and Estimates.
  4. Click on the Company Preferences tab.
  5. Tick the Yes option on both sections on the DO YOU CREATE ESTIMATES? and DO YOU DO PROGRESS INVOICING?
  6. Select OK.

Once done, you can now create an Estimate and create progress invoicing to link the Job cost per contract. Please refer to this article to know the detailed steps: Set up and send progress invoices in QuickBooks Desktop. You'll also learn how to track the transactions linked by running a report mentioned at the bottom part of the article.

 

You'll want to customize the report to see the progress of the Job cost being rendered. Here's an article that fits: Customize customer, job, and sales reports in QuickBooks Desktop.

 

Please don't hesitate to tag my name below if you need further assistance or questions. I'd be happy to back you up. Have a wonderful day ahead.

View solution in original post

8 Comments
MarsStephanieL
QuickBooks Team

Customer Terms

Hi there, @Holly31.

 

In QuickBooks, we use Estimates and Progress Invoicing to complete this task. This way, you can create and break down the cost of an estimate into many invoices needed for partial payments on the work done. I'd be glad to show you how to do that. 

 

You can begin with turning on the Progress Invoicing feature, here's how:

 

  1. Go to the File menu and select Switch to Single-user mode.
  2. Navigate to the Edit menu and select Preferences.
  3. From the left menu, select Jobs and Estimates.
  4. Click on the Company Preferences tab.
  5. Tick the Yes option on both sections on the DO YOU CREATE ESTIMATES? and DO YOU DO PROGRESS INVOICING?
  6. Select OK.

Once done, you can now create an Estimate and create progress invoicing to link the Job cost per contract. Please refer to this article to know the detailed steps: Set up and send progress invoices in QuickBooks Desktop. You'll also learn how to track the transactions linked by running a report mentioned at the bottom part of the article.

 

You'll want to customize the report to see the progress of the Job cost being rendered. Here's an article that fits: Customize customer, job, and sales reports in QuickBooks Desktop.

 

Please don't hesitate to tag my name below if you need further assistance or questions. I'd be happy to back you up. Have a wonderful day ahead.

View solution in original post

Holly31
Level 3

Customer Terms

Thank you!  They use an unrelated estimating software and have not been diligent about entering revenue/cost estimate (also causing fits with WIP reporting).  They already have preference set as you recommended.

 

I'm going to read the links you provided.  I'll let you know if I have any questions (pretty sure that I will).  Will it matter that they are doing CO's as separate estimates?  What's the preferred way to add cost/revenue related to a change order?

GraceC
QuickBooks Team

Customer Terms

I'm glad to see you getting back to us here in the Community, @Holly31.

 

You'll have the option to edit or change the information on your estimate that you send to your customer. Let me walk you through editing an estimate in QuickBooks Desktop (QBDT).

  1. Go to Customers menu and select Customer Center.
  2. Select the customer on the estimate you want to edit.
  3. On the right side portion of the screen, click the Transaction tab.
  4. In the Show drop-down, select Estimates.
  5. Look for the estimate you want to edit and double-click to open it.
  6. Update the details on the transaction.
  7. Hit Save & Close.

Capture estimate1.PNG

Capture estimate2.PNG

Capture estimate3.PNG

Furthermore, here's an article you read that provides basic information in creating an estimate in QBDT: Create an estimate.

 

I've added this article in case you need help with the Accounts Receivable workflows in QuickBooks Desktop.

 

You can always share your concerns with us, as we're here to get your QuickBooks matters sorted out.

Holly31
Level 3

Customer Terms

While you provided very valuable information, I'm still at a loss for how to make payment terms a particular day of the month.  Please help us to understand how this works.

Rubielyn_J
QuickBooks Team

Customer Terms

I'd be glad to guide you on how to make payment terms in QuickBooks Desktop, @Holly31.

 

Payment terms signify when you expect to receive a payment from a customer or when you pay bills to your vendor. 

 

To add a payment term, here's what you'll need to do: 

  1. Go to the Lists menu.
  2. Select Customer & Vendor Profile Lists and then choose Terms List.
    b1.PNG
  3. From the Terms drop-down at the bottom, choose New.
  4. Enter the name of your payment term.
  5. Choose your preferred payment term:
  • Select Standard if you want to have a payment due within a specific number of days from the invoice date. For instance, you have invoices that are due within 30 days of receipt, and you give a 2% discount if the customer pays  you within 15 days
    b2.PNG
  • Select Date Driven if you want to enter the day of the month that a payment is required within the due date. For example, your invoices are due on the 30th day of the month and you give your customers a 1% discount if they pay before the 15th of the month. 
    b3.PNG

     6. Click OK to save it.

 

You'll want to save time managing your payments. Feel free to review this article for the details: Recurring Payments.

 

Please leave a comment below if you need further assistance with setting up customer terms in QuickBooks Desktop. I'm here to always help.  

Holly31
Level 3

Customer Terms

Thank you for jumping in to help.  Neither standard solution works for us.  Here are our requirments.

 

1. We must prepare and submit invoices before a fixed contract date each month. 

2.  The invoice is not due until the following month on the fixed contract date.

 

ex.  Customer has fixed date of the 25th.  Due to volume, we begin to prepare and send invoices days before the 25th but it's not standard when they are sent.  The customer is expected to pay by the 25th of the following month.

 

We can get close using standard functionality but not good enough for cash flow projections or collection work.  Still need a solution.

MariaSoledadG
QuickBooks Team

Customer Terms

Thanks for getting back to us, Holly31.

 

For now, those options mentioned by @Rubielyn_J are the only possible solutions that you can do if you want to set up payment terms in QuickBooks Desktop. 

 

If this functionality doesn't work for cash flow projections, I recommend reaching out to your accountant for other ways on how to do it. 

 

You can also stay current on all QuickBooks latest news and updates by visiting QuickBooks Blog.

 

For future reference, you can read this article in case you'll enter customer payment: Record An Invoice Payment.

 

As always, let us know if you need more help. We're always here to assist you anytime.

Holly31
Level 3

Customer Terms

No solution.  Sad.  This billing method is normal for contractors.  Perhaps someone else in the construction industry give me their method of creating terms consistent with contract.

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