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2150 4832 7
June 30, 2024
Question

Clients accountant says she can't use QuickBooks because she has too many disbursements. There must be way of recording these in Quickbooks so they don't show as income

  • June 30, 2024
  • 1 reply
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Client runs a management company for holiday lets and will buy items for the homes and then charge the cost back to the owner.  Accountant has said that this would make things too complicated to use QuickBooks.  How would we record these and is there a way of easily recording each transaction under the different house so we can pull the expenses off for each house when invoicing?

1 reply

A
AdonL
June 30, 2024

Hello there, 2150 4832 7. Let me provide details about managing expenses and billing for multiple properties.

 

In QuickBooks Online (QBO), you can effectively record a disbursement so they don't show as income in your profit and loss by generating a new account on your chart of accounts, setting up Classes for each holiday home, and creating a service item for disbursements. It allows you to categorize transactions by property and handle transactions without showing disbursements as income. I'll guide you through the process.

 

First, create a new account:

 

  1. Go to Transactions and select Chart of accounts.
  2. Hit the New option in the top right corner.
  3. Enter a name on the Account name. ( Ex: Client Disbursements or Reimbursable Expenses )
  4. On the Account Type drop-down, press Other Current Assets
  5. Choose the Detail Type to specify the type of account.
  6. You can include information in the Description field and an amount in the Balance field.
  7. Click Save and Close.

 

Next, set up classes for each house:

 

  1. Go to the Gear icon.
  2. Select Account and Settings.
  3. Navigate to the Advanced option.
  4. Click the Categories section.
  5. Turn on the Track locations. 
  6. Switch to track Departments.
  7. Hit Save, then Done.

 

Then, add a location:

 

  1. Go to Settings and select All lists.
  2. Click Locations.
  3. Choose New, then enter the name of the location you want to track in the Name field.
  4. Hit Save.

 

Finally, create a service item for disbursements:

 

  1. Go to the Sales section and select Products and Services.
  2. Click New
  3. Enter a Name for the item ( Ex: Disbursements ).
  4. Under Sales Information, place a checkmark next to the I sell this product/service to my customers option.
  5. Choose the account from the Income Account drop-down.
  6. Click Save.

 

When buying items for a specific house or paying for items on behalf of clients, record them as expenses and use the disbursement service items you created. Here's how:

 

  1. Go to + New. and select Expense.
  2. Fill in the payee, payment account, and date
  3. In Category details, select the disbursement service item.
  4. Check the Billable box and select the property owner
  5. In the Class field, select the appropriate house.
  6. Enter the amount and any relevant notes
  7. Save the transaction.

 

Additionally, I highly suggest working with an accountant on how to handle your transactions. You can use our Find An Accountant Tool to find one near you.

 

Let us know in the comments below if you have further concerns about handling disbursements in QBO. We're always here to help you out. Have a great day ahead.

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