Service Item On Invoice Not Hitting COGS

CurtisJ · ‎June 18, 2020

Here is my situation. I own multiple properties(their own companies) and one company that does all the repairs and maintenance on my properties. To reduce tax's my R&M company invoices the properties at a net zero to the expenses it incurred while improving/maintaining/repairing the properties. So on my P/L the COGS for my R&M company should equal the income from invoicing my properties. My issue is this.. I'm attempting to bill for labor burden and I need the amount I input on the invoice to show up on both COGS and income on the P/L. Unfortunately it is not pulling the cost onto the COGS, only showing as income. If you see the attachments, I have the Labor Burden expense account to the COGS account and Income account I would like it to hit. What am I doing wrong?

CurtisJ · ‎June 18, 2020

Think I figured it out.. If I want the labor burden to hit the COGS and income on an invoice it need to be set up as an Inventory Part.

Better way to do this, have my burden rates for each R&M crew member I have broken down into the specific expenses. Debit the property COGS account and credit the expense accounts that house the burdens.

For Example: if my employees burden is $5 an hour split between $2 for W/C insurance and $3 for G/L and he worked 3 hours at a specific property I would:

Debit: My COGS account for R&M on that property $15

Credit: W/C Expense Account $6

Credit: G/L Expense Account $9

I would do this because my actual expense on insurance is less than what I've paid to date because other companies are now paying for it.

View solution in original post

CurtisJ · ‎June 18, 2020

Think I figured it out.. If I want the labor burden to hit the COGS and income on an invoice it need to be set up as an Inventory Part.

Better way to do this, have my burden rates for each R&M crew member I have broken down into the specific expenses. Debit the property COGS account and credit the expense accounts that house the burdens.

For Example: if my employees burden is $5 an hour split between $2 for W/C insurance and $3 for G/L and he worked 3 hours at a specific property I would:

Debit: My COGS account for R&M on that property $15

Credit: W/C Expense Account $6

Credit: G/L Expense Account $9

I would do this because my actual expense on insurance is less than what I've paid to date because other companies are now paying for it.

View solution in original post

ShiellaGraceA · ‎June 18, 2020

It's great to know you've come up with the solution, @CurtisJ.

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Don't hesitate to swing by anytime if you have other questions or concerns. We're here to lend a hand. Thanks for dropping by and I wish you have a wonderful day ahead.

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Service Item On Invoice Not Hitting COGS