Hey Lynn, thanks for getting back to us. Let's make sure your profit is accurate.
Once you've covered all project costs, the remaining amount (in this case, $20k) is essentially your profit. Instead of invoicing or billing it to a "contractor fee" expense line, you can keep it as a credit balance tied to the project. Typically, this credit balance is managed through a journal entry to an account like retained earnings or owner's equity. The journal entry would involve crediting the project's A/R account and debiting the retained earnings (or owner's equity).
This approach will help maintain a precise profit calculation without inflating expenses or leading to an overstated A/R balance. However, I recommend getting in touch with your accountant for additional guidance to ensure your books are accurate. If you don't have one, you can find one here.
In case you want to track your labor costs and profitability, check out this article for guidance: Track hourly labor costs and profitability by project in QuickBooks Online.
I'm here to help with any other concerns you might have besides your project's profit. Just leave a comment below, and I'll be there to assist. Take care!
