Revenue recognition in Quickbooks Advanced

Hello there, sean-idrivegloba.

I recognize how vital for your company to properly track your client's contract. I'm here to guide you on how to handle your concerns.

QuickBooks Online (QBO) calculates your revenue based on the accounting method set in your account. For cash basis, you'll not see the $120,000 (set up annually) amount because income is realized when the invoice is paid. If you use the accrual method, your report includes income and expenses regardless of whether the invoice or bill was paid or not.

To set up the 3-year contract, you may want to divide $120,000.00 to 36 months. Next, create a recurring invoice with the monthly amount. 

However, I still suggest consulting an accountant for further guidance. They can provide advice on how to handle the situation and ensure revenue is recognized properly in the online program.

If you wish to get a list of all your recurring transactions and the accounts they're linked to in QBO, check this reference for detailed instructions: Review your recurring transactions.

On the other hand, you may want to utilize progress invoicing to track the transaction. It's a useful tool that enables you to bill customers incrementally as a project or job progresses. Thus, you may receive partial payments during the course of the task.

I've attached some links that tackle revenue recognition and other sales-related activities:

• Set up a revenue recognition schedule
• Invoices and payments
• Topics about your company's income and customers

Reach out to me again if you have clarifications about recurring invoices and additional questions about revenue recognition. I'll get back and make sure to respond to them. 

Hello Rasa and thank you for the input.

You state:  To set up the 3-year contract, you may want to divide $120,000.00 to 36 months. This way, your books are in order.

Is this different than 3 year?  How does it help and why would really help me.

What I am struggling with is the Annually.  In accounting (I am a CPA) 3 years annually means the term of the contract is 3 years and the billing happens once a year each year.  Therefore 3 Invoices will go out.  Will QBO Automatically defer the first year when billed and then set up a recurring bill for the other two ?  Otherwise annually should be removed as an option as it is just confusing.  I can only guess that I will need to set up a one year or 12 month recurring invoice it and let the system remind me.  It would be really great if you could actually do annually or am I missing something?  

Thanks.

Hey there, @sean-idrivegloba. 

Thanks for coming back on this thread. 

With the details you gave, I recommend contacting our Customer Support Team to assist you further. Here's how: 

1. Go to the Help icon in the top right-hand corner. 
2. Press the Contact Us button. 
3. Enter your question and hit Let's talk. 
4. Scroll down and choose to Get a callback. 

It's that easy! 

Keep us updated on how it goes. We're always here to lend a helping hand. Take care! 

So just to be clear.  There is no solution for this?  Can it be added as a future consideration as it is the only way for SaaS companies to properly spread the income.  Thanks.

I appreciate your insight, @sean-idrivegloba. I'll be glad to help you forward them to the appropriate individuals to address your concern about revenue recognition in QuickBooks Online (QBO).

Currently, revenue can only be recognized monthly in QBO. I understand how the ability to set up annual revenue recognition is necessary for your bookkeeping. For now, I'll help you relay your suggestion to our product engineers so they can consider incorporating this feature in our future product updates. 

To do that:

1. Go to the Gear icon.
2. Select Feedback under Profile.
3. Enter your suggestion and click Next.

Additionally, feel free to check out this article if you want to have an overview of the different areas of your business, including sales and expenses: Run reports in QuickBooks Online.

Fill me in if you have additional questions about revenue recognition in QBO. We're always available to assist you further. Keep safe!