Chart of Accounts

There's nothing wrong with the steps you've performed in setting up the account, kristis.

The Chart of Account list could be damaged. This is the reason why the Expense account show as Income.

To resolve this, I'd recommend re-sorting the list. This helps everything to go back to its default order. Before proceeding, make sure the program is updated. This keeps the software have the latest features and fixes.

Here's how to re-sort the list:

1. From the Lists menu, select Chart of Accounts.
2. Choose the Account drop-down menu.
3. Select Re-sort List, then click OK.

For more details, please see this article: Re-sort Lists in QuickBooks Desktop.

If the issue persists, let's run the Verify and Rebuild Data tool. This scans data issues within the company file and self-resolves them. 

Additionally, I've included an article that provides different perspectives on how your business is doing. This helps you keep track of your transactions: Customize Company and Financial Reports.

Please keep me posted on how it goes. I'm here if you need additional help in managing your Chart of Accounts. Keep safe always!

Thanks for the suggestions.

I have made sure I have the most recent QB version now (2022) and also did resort the list of Chart of Accounts. I then ran the verify, and no problems were detected. The items are still showing as "Income" when I run a P&L for the project. Both existing entries and new ones I tested. 

I did a little more digging, and under "Customers" and "Item List" i needed to set it up correctly there. Did and now it has corrected itself!