Revenue that is Payable to a Third Party

It's nice to welcome you here in the QuickBooks Community, @HarmanOT. I'll be happy to guide you on how to properly handle revenue owed to a third party in QuickBooks Online (QBO).

From your scenario, we can create a billable expense so you can charge your customers for the services you incur from the wholesaler. However, please be aware that this feature is currently accessible within Plus and Advanced subscription plans.

If you haven't already, let's enable the billable expense feature in your account. Here's how:

1. Go to the Gear icon and select Account and Settings.
2. Go to the Expenses tab and click the pencil icon in the Bills and Expenses section.
3. Turn on the Show Items table on expense and purchase forms, Track expenses and items by customer, and Make expenses and items billable.
4. Select Save, then Done.
   

Once done, please refer to these steps on how to bill a customer for your expense from the wholesaler.

1. Go to + New and select the transaction (Bill, Expense, Check) you want to create.
2. Select the wholesaler's name under Vendor/Payee.
3. Choose an expense account in the Category column. Enter the description and amount of the expense, then click the Billable box.
4. Select the customer you want to bill for this expense.
5. Hit Save and Close.
   

To reimburse the cost, link the billable expense to your customer's invoice. Then, proceed with paying the invoice and the bills so they won't display as open in your reports.

Additionally, customer's billable expenses don't initially reflect on your Profit and Loss statement, as they are not considered business expenses.

Furthermore, you can utilize reports to gain a comprehensive overview of your business' diverse transactions, including expenses.

Please know that the Community is always open around the clock whenever you have further questions concerning expenses. Just hit the Reply button below, and we'll promptly assist you. Stay safe and have a great rest of the day!

@HarmanOT 

IMO, you should record the total amount received from your client as revenue (gross income) and enter bills for the wholesaler's portion as an expense.  The IRS defines gross receipts as "the total amount an organization received from all sources during its annual accounting period, without subtracting any costs or expenses".  Your situation really isn't any different from a retailer that purchases a chair for $500 and sells it for $800.  The $500 just "passes through" but the customer's $800 payment is income and the $500 sale of inventory is an expense.  The more concerning part is that you don't get a bill or statement of some kind from the wholesaler.  I would want some documentation to justify the expense in case of an audit.