Need help entering sales/income/track AR - taxes are cash basis

Hello there, @jpsgirlsf.

Thanks for reaching out to us here in the Community space. I can share some insights on how reports are accumulated in QuickBooks Online (QBO).

You will have to enter invoice transactions so you can run an accrual basis report for your franchiser. You won't be able to pull up an accrual report if you're only entering net sales, income deposits, and insurance payments (which are cash basis).

For additional reference, you can check this link: Choose between cash and accrual accounting methods in reports.

If there's anything else you need help with, just let me know by leaving a comment below. I'll be around to offer more help.

I really appreciate your help with this.  So when you say "You will have to enter invoice transactions so you can run an accrual basis report for your franchiser", could you explain how to do it this way in a little more detail, cause it sounds like I could at least do that on a weekly basis, or even monthly basis.  I keep an Excel spreadsheet for the daily/weekly numbers.

I'm wondering if I could do it this way so that I have an accrual report, because I must be able to report accrual to my franchisor:  Can I enter an INVOICE weekly with the customer as "Sale of Product", and then the amount of the invoice as the total income (including actual money paid and money to be owed from insurance or patients), let's say $50,000. Then go in and RECEIVE PAYMENTS individually to account for the bank deposit I make and the credit card and insurance payments I received (say $48,000) that week or even at end of month?

My goal is to be able to show 1.)total merchandise sales and then 2.) the total income I received through customer payments(cash,credit cards), and insurance payments and to 3.) be able to show the total balance still owed to the business(AR I believe).

I need to be able to file quarterly reports so the total numbers are what matter, I don't need to track daily sales numbers in QB.   Any advice you can provide would be helpful.  Thanks so much.

Hi there, jpsgirlsf. 

All invoices are accrual type transactions, thus, it will display on your sales reports (accrual basis) automatically. The invoices will also show in your cash basis reports once you paid the invoice on the same day. You can pull up the Sales by Customer Detail report or customer summary report to verify the information.

You can enter your invoices for your daily tracking of income and RECEIVE PAYMENT if the customer pays you on the weekend or month end. In this process you can track income you have received and the balances still owed to the business.

For your quarterly reports, you can use the Sales by Customer Summary. This shows the total sales set for the report period for each customer. 

Please let us know if you have additional concerns. I'm here to help!

You both have been very helpful.  Your last response helped me get going but I have another question and wanted to keep in on my same question (hence the reason I didn't marked it solved).  So now that I'm "entering invoices" to my income acct and then "receiving payments", what do I do if I have to do a customer refund from my income account.   What is the proper way to enter it, so that it reduces my income?   Thanks in advance.

It'll be my pleasure to provide you with additional information, @jpsgirlsf.

You can record a refund receipt for your customer. Let me guide you how.

Recording a Refund Receipt doesn't affect your customer's balance, but only affect your bank balance. This said, it'll decrease your bank balance.

Here's how you record a refund Receipt:

1. Click on the Plus (+) icon, choose Refund Receipt.
2. Enter the customer name.
3. Under the Refund From drop-down, choose the bank/income account.
4. Enter the other necessary information.
5. Click on Save and Close.

You may read this article for more information: Record a Customer Refund.

Fill me in if you have any other concerns. I'll be here to assist you. Have a good one!

So, just to confirm I'm doing it correctly the way you mentioned - When I enter a return receipt it will reduce my bank balance.  I also noticed that when I pull the Income by Customer report, it will also decrease my income account (which is what I want).   

Also, It actually looks like everything is record and tracked similar to if I just created a "CHECK" (refund).   Is there a difference?

It’s nice to see you again, @jpsgirlsf.

Allow me to step in for a moment and route you to the direction about tracking a customer refund.

You’re correct. The refund receipt only affects the bank balance. Since you’re currently using the Cash basis accounting, you’ll have to create a check to process customer refunds.

This will reduce the bank's balance and offsets the customer's open credit, overpayment, or prepayment. To accomplish this task, please follow these steps.

1. Go to the Plus icon at the top, then select Check or Expense.
2. Fill in the necessary fields.
3. Under the Category column, choose Accounts Receivable.
4. Enter the refund in the Amount column.
5. In the Customer/Project column, select the customer whom you’re refunding to.
6. Click on Save and close.

Once done, make sure to pair the transaction with credit or overpayment to keep your records correct. Here’s how:

1. Go to the Plus icon at the top, choose Receive Payment.
2. Make sure to fill in and complete the necessary fields.
3. Under Outstanding Transactions, select the check or expense you’ve created.
4. Under Credits, select the unapplied payment.
5. Make sure the amount received is zero.
6. Click on Save and close.

This information should help you move forward. Keep me posted if you have any questions or concerns while working in QBO. Please know I'm always ready to help. Have a great rest of your day!

Great - thanks for clarification.  Another question - So I mistakenly deleted an entry that took my payments and moved them to my unapplied cash payment income acct.  Once I saw this, I went back in and recreated the original transaction.  But now how do I get them to show as payments to my true income acct and not the unapplied cash payment account?  Thanks.

I have a small accounting business and need to track when I generate an invoice so I know I have and the $ to track against the cash payment when it comes in - in the future.  I have QB Desktop.  Is there a way to "track" the invoice for CASH basis?  Right now my P&L shows the MONTH and Amount of the Invoice for INCOME, NOT the DEPOSIT Date and actual received amount.  I know QB was not designed for CASH basis - has anyone found a way to do this?

Hey there, @SueL9. 

Thanks for chiming in on this thread. Allow me to give you some helpful information on this subject. 

A cash basis report only shows income if you have received cash and expenses if you have paid cash. At this time, there isn't a way to do what you're asking successfully in your QuickBooks Desktop account. 

Here's a guide that can provide additional details: 

Differentiate Cash and Accrual basis

I hope this helps answer your questions. I'm only a comment away if you need me. Have a great day!