Accounts Receivable

cmehl · ‎October 08, 2024

I am thinking of switching to Quickbooks Online. I do a large volume of invoice billing through Accounts Receivable. Due to a quirky set up in the company profit and loss statement, I would need to post some of the line items on the AR invoice to a cost of goods general ledger code rather than an income general ledger code. Will the AR let me do this, split my invoice credit side entries between income and some cogs accounts?

RoseJillB · ‎October 08, 2024

Thank you for considering QuickBooks Online (QBO) to assist with your business needs, @cmehl. I will explain how the application interacts with your sales transactions and the affected accounts.

When creating an invoice, there are two factors to consider regarding where the amounts or entries will be posted. This type of transaction affects accounts receivable and the income account. However, it also depends on the accounts used in the products and services set up.

To post some of the line items to the Cost of Goods Sold (COGS) ledger, we can create a service item and designate COGS as the income account. This will record transactions involving these items in their respective ledgers. However, I still recommend consulting with your accountant for alternative methods of handling this.

After that, you can follow the steps below to edit your invoice right after switching to QBO:

Go to the Sales menu and select the Invoices tab.
Locate the transaction you want to split the credit side entry.
Add the service item for COGS entry.
Review the other details, then, click Save and Close.

Additionally, you can use this resource to record payments from your clients once they have settled their balances in QBO: Record invoice payments in QuickBooks Online.

I remain open to any further questions you may have about managing sales transactions or any QuickBooks-related concerns. Have a great day ahead!

Rainflurry · ‎October 09, 2024

@cmehl

Sure, you can post line items on an invoice to COGS. Presumably, you're aware that line items entered as a positive amount on an invoice will reduce COGS. Line items entered as a negative amount will increase COGS.

PBJ10 · ‎October 09, 2024

@cmehl although what you're looking to do is probably technically possible in Quickbooks right now, I would strongly recommend looking into literally any other software besides Quickbooks for accounts receivables needs.

If you spend just a few minutes looking through this forum, you will see countless posts from longtime customers complaining that the changes that Quickbooks has been rolling out for invoicing and reporting has made the product nearly unusable. My team has been encouraging all employers we work with to migrate away from Quickbooks as soon as possible as Quickbooks continues to remove essential features on a nearly weekly basis. So beware, even if it looks like Quickbooks supports your needs now, there's no guarantee it will next month.

Rainflurry · ‎October 09, 2024

@PBJ10

"My team has been encouraging all employers we work with to migrate away from Quickbooks as soon as possible as Quickbooks continues to remove essential features on a nearly weekly basis."

Out of curiosity, where are suggesting they go? Xero has issues with A/R too.

PBJ10 · ‎October 09, 2024

@Rainflurry Sure, it's all going to depend on the customer's needs. Xero, in my opinion, is still more robust and accounting oriented while being less bloated than Quickbooks.

I've seen good feedback about Wave too.

For simple bookkeeping needs, Freshbooks has been a good option. I've also heard about Taxdome, but have not experimented with it much myself. Same for Zoho.

Then of course there's also Netsuite as the most comprehensive option, but it's going to be pricier too.

That's just off the top of my head, but I know there are so many better options out there at much better price points for what Quickbooks is offering these days.

Topics

Training

Community

Resources

Accounts Receivable