Construction Allowance

DarcyS · ‎April 06, 2021

Hi All,

Rookie question, Can someone tell me how to account for general construction allowances? Do I create a COGS account as a Materials Allowance?

ShiellaGraceA · ‎April 06, 2021

Thanks for joining us here today, @DarcyS.

Let me share some information about creating an account for your construction allowance. Though construction allowance is included in the total cost of the contract price, it doesn't tie to the production and sale of a company's goods and services.

That said, you'll have to create the allowance under COS. Here's how:

Go to Accounting, then select Chart of Accounts.
Click New, then pick Cost of Goods Sold as the Account Type.
Under Detail Type, choose Other Costs of Services - COS. You can type in the account Name and Description.
Hit Save and Close.

With the above steps, you're able to track the construction allowance as part of the cost of your prescribed items.

I've added these links below for more information about inventory tracking in QBO.

In case you need help with other tasks in QBO, feel free to browse this link here to go to our general topics with articles.

Let me know if you still have questions or concerns with accounts. I'm always here for you. Have a wonderful day ahead.

View solution in original post

ShiellaGraceA · ‎April 06, 2021

Thanks for joining us here today, @DarcyS.

Let me share some information about creating an account for your construction allowance. Though construction allowance is included in the total cost of the contract price, it doesn't tie to the production and sale of a company's goods and services.

That said, you'll have to create the allowance under COS. Here's how:

Go to Accounting, then select Chart of Accounts.
Click New, then pick Cost of Goods Sold as the Account Type.
Under Detail Type, choose Other Costs of Services - COS. You can type in the account Name and Description.
Hit Save and Close.

With the above steps, you're able to track the construction allowance as part of the cost of your prescribed items.

I've added these links below for more information about inventory tracking in QBO.

In case you need help with other tasks in QBO, feel free to browse this link here to go to our general topics with articles.

Let me know if you still have questions or concerns with accounts. I'm always here for you. Have a wonderful day ahead.

LMBUILDERSnj · ‎September 23, 2022

I have these set up wrong in QB but I don't have a detail type under COGS to make it otherCOG Is it because I am desktop?

AbegailS_ · ‎September 23, 2022

Thanks for chiming in the thread, @LMBUILDERSnj.

I appreciate you for following the outlined steps that my colleague shared above, I'll be sharing details on how accounts in QuickBooks works.

The Account Types and Detail Types lists are built-in and fixed functions within QuickBooks Desktop Hence, we cannot change or edit the Detail Types list when creating new accounts (Chart of Accounts).

We can only suggest that you choose the closest detail type to the one you're looking for.

You may open this article to view different details on how the accounts in the Chart of accounts page give you various account types to categorize transactions: Learn about the chart of accounts in QuickBooks.

Also, to further guide you in starting, fixing, and editing completed reconciliation, I'd recommend checking out this article: Learn the reconcile workflow in QuickBooks.

Please don't hesitate to keep me posted on how it goes in the comments below. If you have other concerns about banking, reconciliation, and managing transactions in QBDT, I'm always around to help.

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Construction Allowance