Operating a small business that provides services and parts.

Dmichel · ‎February 12, 2021

I could use help on understanding the exact process and workflow I need to achieve to keep my books in order.

Company background - I own and operate my own small business (llc) and I am the only employee. I clean gas bbq grills (hourly labor charge and some service charges - non-taxable) and I do repairs (I buy parts from vendors and resell for double - triple the cost and my part sales are taxable.) My clients pay cash, check, or card and payment is due after service but sometimes a day or two goes by until they pay (idk if you need this info)

I know my books were messed up! So I had my bookkeeping set up appointment with QB and the gal helped me understand quite a bit. But... I am still quite lost.

I had previously made every transaction through an invoice (I use estimates but not very frequently) though she stated a sales receipt would be easier. We are primarily paid via check so the sales receipt is confusing since checks are not deposited until later in the day. Should I just keep using the invoice? What is the difference and with my company and the way I work what would be the best workflow for customer payments?

My second problem is the parts and cogs with vendors. For the time being, I pay for all of my parts up front. I do not have a credit system set up. I know I can use the vendor section for POs , bills, and payment. My question is, what is the correct work flow when you pay for parts in inventory (I keep track and have it set up with QBonline) but you purchase the part first and then you receive the part?

Thank you in advance!

DivinaMercy_N · ‎February 12, 2021

Thank you for providing details of your concern, @Dmichel.

In QuickBooks Online (QBO), you create invoices to customers if they will pay you at a later date and sales receipts if you were paid at the time of sales. If you received a check from your customer, use the received payment feature and pick the check as the payment method. Then, you can also use the Undeposited Funds Account to hold payments received from invoices before you deposit them into the bank.

For more info on how to process customer's payments, please see this article: Invoice and Sales Form Basics.

Then, to handle parts of inventory you purchase first before receiving the part, you can create an expense or check transactions. You'll have it post to the Accounts Payable account to record the payment of the purchase. Once you received the item, create a bill to record the inventory and link the created expense/check to the bill to mark it as paid.

Also, to get a list of all payments and invoices for each of your customers, you may pull up the Invoices and Received Payments Report.

If you need further assistance with managing payments in QuickBooks, please leave a response below. I'm always here to help. Have a great day ahead.

Topics

Training

Community

Resources

Operating a small business that provides services and parts.

Operating a small business that provides services and parts.

Need to get in touch?