How Do You Track Jobs in QuickBooks? Part 2

In this second of a two-part series, we’ll explore how you use the job-related records you’ve created.

Last month, we showed you how to start building a foundation for tracking jobs in QuickBooks. We explained that you can use the software’s jobs tools to track income and expenses for any related group of items and/or services (you can think of them as projects, if you prefer).

We covered three elements of preparing to use “jobs”:
  • Creating job records that you can use in transactions (example: develop promotional materials)
  • Creating item records that can be assigned to jobs (example: website development)
  • Determining whether you’ll need to create a new account in your Chart of Accounts for your job income and expenses. You should consult with us anytime you think it might be necessary to modify the Chart of Accounts.
Using Your Job-Related Records

Now that you’ve recorded the items and jobs themselves, you can start using them in transactions, and eventually track your progress by generating reports.

Let’s say you worked eight hours on website development for your promotion job. You’d open the Employees menu and select Enter Time | Time/Enter Single Activity to open this window:

snapshot of time/enter single activity

You can enter individual, billable activities and assign them to jobs.

In the example above, you’re limited to recording one day’s work on a specific SERVICE ITEM. You’d verify the date and select from the drop-down lists to complete the fields for employee NAME, CUSTOMER:JOB, and SERVICE ITEM. You can either use the timer to time the job or enter the number of hours manually in the DURATION box. Click in the Billable box to create a checkmark and add NOTES if you’d like. The CLASS field is optional; talk to us if you’re not familiar with this feature.

 If you worked on two separate service items on the same day for that CUSTOMER:JOB, you would create two individual records. You can also enter billable activities directly on a timesheet by clicking Employees | Enter Time | Use Weekly Timesheet. Once you select the employee NAME at the top, any single activity(ies) you created that week will appear as individual records, and vice versa.

Writing a check or using a credit card for a job-related purchase that should be billed to the customer? You’d fill out these forms in QuickBooks like you usually do, making sure that you document the items or services by highlighting the Items tab, select the correct CUSTOMER:JOB, and make a checkmark in the BILLABLE? column.

credit card purchase/charge

If you write a check or charge your credit card for purchases that can be billed to a CUSTOMER:JOB, be sure to record it in QuickBooks.

If you’ll be doing some billable driving for your job, you should also be tracking your mileage in QuickBooks. Open the Company menu and select Enter Vehicle Mileage. If you haven’t created a VEHICLE record in QuickBooks, click <Add New> and easily do so. Complete the rest of the fields and save.

Tip: Do you want to see some of your overhead expenses on job costing reports? Create a CUSTOMER:JOB named “Overhead” and assign related costs to it.

Billing the Billables

When the time comes to invoice your customers (Customers | Create Invoices), you’ll see how your careful work in QuickBooks simplifies that task. Open an invoice form and select a CUSTOMER:JOB. If you’ve entered billable items for him or her, this small window will open:

 billable time/costs

When you create an invoice for a CUSTOMER:JOB who has billable time, mileage, or other expenses, QuickBooks can automatically add them.

If you leave the first option checked and click OK, another window will open that lists all of the expenses you’ve marked as billable to the customer, arranged by type. Click in the first column of each expense you want to include and click OK. Your invoice containing those entries will open. Do any editing necessary, and then save it.

Note: You’ll probably notice two fields in the Choose Billable Time and Costs window that refer to Markup. This is an advanced concept that we can explore with you, should you want to charge customers more for expenses you’ve incurred on their behalf.

Related Reports

QuickBooks contains a wide variety of reports related to your work billing customers for jobs. Click Reports in the navigation pane or Windows menu, then Jobs, Time & Mileage to see what’s available. Choose a date range and click Run to see them appear with your own data.

If you’ve never worked with jobs in QuickBooks, we strongly recommend that you let us help you here. There are a lot of moving parts, and you don’t want to miss out on any of your efforts or expenses that are billable.

For more QuickBooks tips, tricks and info on training from our team of Certified QuickBooks ProAdvisors® subscribe to The QBC.

QuickBooks and QuickBooks ProAdvisor are registered trademarks and/or registered service marks of Intuit Inc.

Audit & Accounting Update: February 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

Changes to revenue recognition in the consumer products industry
We have published a white paper to assist consumer products entities in understanding the new revenue recognition guidance.

Private company accounting for common control arrangements
Our white paper provides insights on private company accounting for variable interest entities under common control.

Business combinations: In motion
Our summary highlights standard-setting activities that affect the content in our Guide to Accounting for Business Combinations.

Market volatility: Consideration of goodwill impairment
Reminder: a significant drop in share price could be a triggering event for the consideration of the impairment of goodwill.

FASB proposes targeted transition relief for CECL
The FASB proposes to allow the option of measuring certain types of assets within the scope of Subtopic 326 at fair value.

 

computer, phone and pens on a desk

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Nonprofit Update: February 2019

Determining an appropriate reserve level for nonprofit organizations
Setting a financial reserve level is a key process for a nonprofit organization, providing necessary funding to continue operations during a host of potential challenges or taking advantage of strategic opportunities. However, many nonprofits do not have a defined process to establish reserves, exposing the organization to undue risks. In an environment of economic and political uncertainty, implementing an effective method to set reserves is critical to long-term organizational sustainability.

Proposed accounting alternatives for not-for-profit entities
The Financial Accounting Standards Board has proposed accounting alternatives for not-for-profit entities for goodwill and certain identifiable intangible assets. The Financial Accounting Standards Board recently issued a proposed Accounting Standards Update (ASU) that, if finalized, would extend the scope of two private company accounting alternatives to not-for-profit entities – the accounting for goodwill and the accounting for identifiable intangible assets in a business combination. Also, in a business combination, a not-for-profit entity would have the option to subsume into goodwill and amortize certain customer-related intangible assets and all non-compete agreements.

Setting up a security steering committee
In many cases, companies isolate security into its own segment. Responsibilities are typically split between low-level IT staff, who must juggle break/fix situations with technology investments, as well as security tasks. However, this scenario often results in security best practices being overlooked for the sake of convenience, and little alignment between the IT group and the rest of the organization regarding security decisions.

District of Columbia government issues notices concerning exemption expiration
The notice states that over the 2019 calendar year the District of Columbia Office of Tax and Revenue (OTR) will begin to expire tax exemptions granted under District law.  The notice states that all exempt entities will be required to renew their exemptions or they will have their classifications changed to being taxable entities.

 

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP. This includes regular updates on the latest insights for nonprofit organizations.

Tax Update: February 2019

Tax Reform

Final regs highlight actions for taxpayers using 20 percent deduction
Critical action items taxpayers need to take.


Trending in Tax

Tax issues arise when employers pay employee business travel expenses
Business travel arrangements require employers to carefully analyze and determine proper tax treatment for employees.

Why we call it business transition planning
What is the secret to a successful business succession and transition for owners? It starts with a sound plan.

The gift tax exemption coast is clear. Time to go back into the water?
Knowing that there will be no loss of the benefit of using the higher exemption before 2026, we consider some ways and means of using it.

writing in note pad and calculator out

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/tax-digest.html

Disclaimer

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit; and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest federal, state, and international tax news as well as updates pertaining to the Tax Cuts and Jobs Act. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

How Do You Track Jobs in QuickBooks? Part 1

If your business divides some of its work into specific jobs and you’re not tracking them individually, you’re missing out on valuable insight.

 Job-costing is not just for contractors. That’s probably the most common understanding of this concept in QuickBooks, but you can also use the software’s jobs tools to track income and expenses for any related group of items and/or services.

Think of them as projects. If you’re an expert in business promotions, for example, you probably have multiple projects going on simultaneously that consist of materials you might need to order for your client (like special paper) and the actual work you do (design, content-creation, etc.). You could also have to track expenses like mileage, and you may price your services by the hour.

QuickBooks can handle all of this. If you’re conscientious about documenting all of the pieces that go into every job, you’ll be able to run reports that show you how much you spent and took in on each. This information can help you better price your services and manage your time to maximize profitability.

Many Elements                                  

 In this first part of a two-column series, we’re going to explore the basic elements that go into job-tracking. Keep in mind that there are many different ways to work with jobs. How you choose to do it will depend on the structure of your business. We can help you devise a plan.

We’ll look at a simple example here. The first step involves setting up a job for an existing client. Even if you think you’re only going to be doing one project for them, you can still set it up as a job so you can assign all related income and expenses to it. This will make it much easier if you get additional work from the customer down the line – and if you have to bill the customer for something that’s not related to a specific project.

To create a job, open the Customers menu and select Customer Center. Make sure the Customers & Jobs tab is highlighted. Select the customer by clicking on it. Right-click the name and select Add Job from the drop-down list. When the New Job window opens, click the Job Info tab.

showing how to track jobs

You can track your Jobs by keeping their status current in the New Job window.

Fill in the Job Name field. In this example, we’ve selected a name that’s broad enough that we’ll eventually be able to break down into specific tasks. If your customer has an outstanding balance as of the current date, that amount will appear in the Opening Balance field.

Enter a Job Description. The Job Type field is optional, but creating these classifications can help with advanced reports that gauge profitability. Consult with us if you want to explore these.

Open the Job Status list and select the correct one, then choose a Start Date and Projected End Date. You’ll document the End Date when you’re finished. Click OK.

Creating Item Records

 You may already know that if you buy and/or sell products and/or services, you have to set up individual records for each one so you can include them on sales and purchase forms. You’ll need these to record income and expenses related to your Promotion job. If you’re new to QuickBooks, here’s how it works.

Open the Lists menu and select Item List. In the window that opens, click the arrow next to Item in the lower left corner and select New. A window like this will open:

shows what type of services you charge for or purchases

The New Item window

The Item Type list will drop down. Select Service. In the example above, you’re creating a record for a service you sell: Website Development. Enter that in the Item Name/Number field. Ignore the U/M Set field; this is not available in QuickBooks Pro or Premier.

Enter a Description and your hourly (or project) Rate. Choose the correct Tax Code status and select the Account. When you’re done, click OK.

Warning: You may not have an Account in your Chart of Accounts that fits the specialized income and expenses you want to track. Let us help you set one up.

 You’ll repeat this process for other types of promotional work you do (making flyers and brochures, designing and ordering branded products, general content creation, etc.).

Think It Through First

 Before you create your first job, spend time envisioning how you want it structured. Remember that every invoice or timed activity or other income or expense you enter will only be assigned to one Customer:Job, but you can include as many Items as you want. As we said, we’re happy to help you think this through and go through setup with you.

Next month, we’ll demonstrate how the records you’ve created can be used.

For more QuickBooks tips, tricks and info on training from our team of Certified QuickBooks ProAdvisors® subscribe to The QBC.

QuickBooks and QuickBooks ProAdvisor are registered trademarks and/or registered service marks of Intuit Inc.

Audit & Accounting Update: January 2019

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest financial reporting insights. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

FASB Staff Q&A document: Estimating credit loss reserves
A FASB Staff Q&A addresses use of the WARM method to estimate credit loss reserves for less complex financial asset pools.

ASC 606: Disclosure checklists for public and nonpublic entities
Our disclosure checklists are intended to assist entities in complying with the FASB’s revenue-related disclosure requirements.

Monitoring inflation when applying ASC 830
The CAQ International Practices Task Force has developed a framework that may be helpful in monitoring inflation statistics.

FASB issues narrow-scope amendments to ASC 842
The FASB has addressed three issues lessors sometimes encounter in applying Accounting Standards Codification Topic 842, “Leases.”

Proposed Codification improvements for lessors
The FASB has proposed guidance for two issues lessors sometimes encounter in applying Accounting Standards Codification Topic 842.

Proposed accounting alternatives for not-for-profit entities
The FASB has proposed accounting alternatives for not-for-profit entities for goodwill and certain identifiable intangible assets.

consulting with one another using a calculator

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/financial-reporting-insights.html

As always, we hope you enjoy this edition of our newsletter and we look forward to receiving your feedback. Should you have any questions regarding the information contained in the attached materials or our service offerings, please contact us directly.

Tax Update: January 2019

Tax Reform

New year, new law, new challenges
Complexity of the Tax Cuts and Jobs Act and technology delays at the IRS may force taxpayers to extend filings. At a minimum, taxpayers should be prepared to extend and file their returns later in the year, even if they have previously filed by the March or April 15 deadlines. Taxpayers should consult their tax adviser and make a plan to address the appropriate timing and additional steps necessary to file their 2018 returns.


Trending in Tax

Tax reform’s impact on business and professional services firms
Business and professional services firms face challenges due to tax reform, but there are opportunities to maximize the benefits, too.

Post-Wayfair misconceptions and technology companies
The Wayfair decision doesn’t just affect online retailers. Technology businesses must address resulting state sales taxes, too.

Tax deduction for pharmaceutical drug inventory
Enhanced tax deduction may be available for drug inventory contributions made to certain charitable organizations.

Nonqualified deferred compensation plan FAQs for employers
When setting up or managing nonqualified deferred compensation plans, employers should consider several key questions.

 

tax preparer typing on computer and using calculator

Source: RSM US LLP
Used with permission as a member of the RSM US Alliance
http://rsmus.com/our-insights/newsletters/tax-digest.html

Disclaimer

At Insero, we make it our business to stay abreast of the latest trends and technical updates in accounting, tax, and audit; and we understand how important timely updates are to our clients. As a member of the RSM US Alliance, we also have the benefit of access to the resources and subject matter experts of RSM US LLP (formerly known as McGladrey LLP). This includes regular updates on the latest federal, state, and international tax news as well as updates pertaining to the Tax Cuts and Jobs Act. We hope that you find these informative and useful, and invite you to reach out to us if you have any questions.

How to Apply Finance Charges in QuickBooks

You may hate to have to do it, but assessing finance charges for late payments may improve your overall cash flow.

There are a myriad of ways to bring in customer payments faster and improve your cash flow. You can:

  • Get a merchant account and let customers pay you electronically
  • Offer a discount for early payments
  • Shorten the payment due cycle (21 days instead of 30 days, for example)
  • Be more aggressive about collections

QuickBooks can help you take all of these steps. It also offers a fifth option: assess finance charges for tardy remittances.

Maybe you don’t want to do this because it seems like a less-than-friendly way to treat customers – especially valued ones. But you’re not in the business of lending money, which is what you’re doing when you continue to let your accounts receivable slide. So, here’s how to do add finance charges to your payment policies.

Multiple Issues Involved

Before you can start adding finance charges to tardy payments, you’ll need to let QuickBooks know how you want them handled. Open the Edit menu and select Preferences. Click the Finance Charge tab in the left vertical pane, then the Company Preferences tab in the window that opens. You’ll see something like this:

example of how to enter finance charges

You’ll need to decide on your QuickBooks Finance Charge settings before you can begin to apply these late fees.

What Annual Interest Rate will you charge? Will there be a Minimum Finance Charge? Do you want to offer a Grace Period? If you’ve never worked with finance charges before, you might be at a loss as to how you should answer these questions. We can talk it through with you if you’d like, and make sure you’re selecting the correct Finance Charge Account. In our example, QuickBooks defaulted to 70100 – Other Income, which may be the best option for you.

The next question may require some research. Some jurisdictions don’t allow you to Assess finance charges on overdue finance charges; you’ll need to find out. If there’s any doubt, make sure that the box in front of that option isn’t checked.

QuickBooks also needs to know on what date it should start calculating finance charges: on the due date or invoice/billed date. Finally, check the box in front of Mark finance charge invoices “To be printed.” QuickBooks doesn’t include finance charges on invoices themselves; it bills them on separate invoices. Check this box if you want the software to print all of them as a batch.

When you’re done here, click OK.

Applying the Charges

 example of how assessment date is used to calculate charges

By selecting an Assessment Date, you’re telling QuickBooks how many late days should be included in its finance charge calculations.

When you’re ready, open the Customers menu and select Assess Finance Charges. A window like the one in the image above will open.

QuickBooks, of course, performs all of the required calculations in the background. But it must first know what specific date you plan to actually assess the charges so that it can determine the number of late days that should be included. This may not be the current date, so be sure the Assessment Date is correct before proceeding.

All you have to do here is make sure there’s a check mark in front of every finance charge that should be invoiced (they’ll probably already be there, but you should verify this). If you send statements, clear the box in front of Mark Invoices “To be printed.” The finance charges will appear on the next statement.

When you’re satisfied, click Assess Charges.

Dispatching the Charges

Your finance charges have now been recorded in QuickBooks as individual invoices. When it’s time to print, open the File menu and select Print Forms | Invoices. You’ll see your numbered finance charge invoices displayed like this:

example of invoice charges when printing them

You can see your finance charge invoices when you go to print them.

(Of course, if you email invoices, you’d click on File | Send Forms.)

It’s a good idea to notify your customers before you start assessing finance charges. This will give them a chance to catch up, and no one will be surprised to see the extra invoices.

QuickBooks does the hefty lifting as far as calculations are concerned, but it’s very important that you set your finance charges up correctly. Customers will be annoyed by mistakes. And it’s much easier for us to help you get this tool set up right from the start than to have to go in and untangle errors. Let us know if you plan to start assessing finance charges, and we’ll help make it work for you.

For more QuickBooks tips, tricks and info on training from our team of Certified QuickBooks ProAdvisors® subscribe to The QBC.

QuickBooks and QuickBooks ProAdvisor are registered trademarks and/or registered service marks of Intuit Inc.