How do I assign payroll expenses to a direct labour COGS account in Quickbook Desktop?

Hello Ironmikesharp,

Thanks for taking the time to highlight what you're looking to do in QuickBooks Desktop as well as what edition of the software you're using. At QuickBooks, we know there might be various reasons you'll want to map things a certain way, and our goal is to keep it as simple as possible. I'll help you with this.

I see you asked this question in the US section of the QuickBooks Community as well. If you're using a US product, I recommend sticking with posting there to make sure you're getting the product information you need. There are some differences between the Canadian and US versions of the software, which is why this is important. Here's the response from the US Community: Reclassifying some employees to COGS and administrative employees to expenses

Before moving forward with doing this, I recommend checking in with an accountant to make sure this is the right move for your books. These kinds of changes do impact reporting, the accounts you see on reporting, and how the program allocates funds, so having a sense of if this is the best practice is good before jumping in. You can even use the Find an Accountant page to find a QuickBooks-certified accountant near you.

Once you know what steps to take, here's how you can make changes to your payroll items. It's the same sort of process as outlined by my US colleague, where you go into whichever payroll item you need to re-map the account. Here are those steps again.

1. Select Lists from the top menu.
2. Choose Payroll Item List.
3. Double-click the item you want to edit.
4. Click Next until you find the Expense account tab.
5. Choose the account you want.
6. Click Finish.

An individual payroll item applies to whoever you assign it to. For situations where you have one you'd like to apply to some, but not all employees, you can consider setting up separate payroll items for your employees. This can also be done through the Payroll Item List as well by clicking the Payroll Item button at the bottom of the screen and then New. Payroll items can be assigned to employees by going to the Employees menu, choosing Employee Centre, and then double-clicking the name you need from your employee list. From there, go to the Payroll Info tab and click in the Items areas to begin adding the ones you need. Be sure to hit OK to save when you're done.

This can be done in single or multi-user mode, so you won't need to switch. Here's an article that goes over the tasks you can complete in each mode: Features available and tasks you can perform in single or multi-user mode

I hope this has been helpful. Don't hesitate to connect with an accountant for this kind of situation. They're a great asset to have for your business and ensure accuracy in your books.

Take care.