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S
Scratchy
May 30, 2021
Question

Capitalize Labour

  • May 30, 2021
  • 1 reply
  • 0 views

How should labour be capitalized?  If the labour already shows on the Profit and Loss (I paid a software developer as an employee), then I want to capitalize some of all of that labour.  It already shows on the Profit and loss, so should it be journaled out and into balance sheet (so we see it move and how it got there, while seeing what the actual burn was on labour?  Or do we not want it on the Profit and loss at all?

1 reply

T
Tammy_H
May 31, 2021

Hi Scratchy,

 

I want to welcome you to the QuickBooks Community. It's fantastic to see new members joining the conversation. In QuickBooks Online, you have various reports that can give you all the information you need to run your business. Two of these reports are those you mentioned the Profit and Loss report and the Balance Sheet. I'll explain what information these two reports contain.

 

The Profit and Loss report shows you the company's revenues less expenses giving you the net profit. The Balance Sheet is a snapshot, a statement of a business's assets, liabilities and shareholders' equity at a specific point in time. I've included a couple of articles and a couple of video tutorials that you can review on the two report types and how to run the reports:

I suggest reaching out to your accountant to discuss how you should be tracking your labour costs. If you don't have an accountant, you can locate one familiar with QuickBooks through this link; Find an Accountant.

 

If you have any questions about your QuickBooks Online product or account, please let me know. I'm here to help. Have a great day!

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