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ckbranstad
Level 1

Why is our net income for the year high compared to our open invoices and bank account?

 
1 Comment
Rejeil_O
QuickBooks Team

Why is our net income for the year high compared to our open invoices and bank account?

Welcome to the Community, @ckbranstad.

 

Net income will not be matched in your open invoice and also for your bank because the bank account transactions do not only affect income and expense, it will also affect the liability and asset accounts.

 

Also, you'll need to consider the accounting method on your Profit and Loss report which is the Cash or Accruals. Combining your bank account and open invoices means you're reporting both Cash and Accrual as one. While Profit and Loss will only allow you to report either Cash or Accrual only.

 

You can follow these steps on how to change the accounting method on a report. Here's how:

 

  1. Go to the Reports tab.
  2. Choose a report.
  3. Select either Cash or Accrual in the Accounting method field.
  4. Click the Run Report button.

 

You can read this article for more detailed information about the Cash and Accrual in QuickBooks Online: Choose between cash and accrual accounting methods in reports

 

You can also visit this link to learn more about reports in QuickBooks Online: QuickBooks Online Help Article.

 

Just notify me if you have additional questions by leaving a message in the comment section. I'll be happier to help. Take care and have a wonderful day!

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