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vidtravel
February 16, 2024
Question

Products and Services with Profit Margin

  • February 16, 2024
  • 1 reply
  • 0 views

I'm trying to set up some products/services in Quickbooks properly so that I can track profit margin without having to mark it up each time in the Project Cost Estimate. Here's a classic example for me:

  • Employee A costs me $335/day to work on a project ($452.25 with a 35% markup)
  • Employee B costs me $495/day to work on a project ($668.25 with a 35% markup)
  • Contractor 1 costs me $500/day to work on a project ($675 with a 35% markup)
  • For equipment I own I assume a roughly $300/cost per day for a project, which is basically me renting it from my self 25 times to pay for the items in that package. ($405 with a 35% markup)


Here are my concerns with each:

  • Income from hiring employees feed back in to my operating expenses and help me meet payroll (they have a salary, not hourly wage). Clearly, a project with employees involved is more beneficial, because it helps me meet payroll. I'm not sure how I can list them to show I'm making doing better on that project vs a project where I have to pay an outside contractor. FYI, I'm not tracking contractors or employees/payroll in QBO.
  • For the equipment package, how would I show I'm making money on this if it's not a product/service I purchase from a vendor.

1 reply

I
Irene R
February 16, 2024

Welcome to the Community, Vidtravel.

 

Let's share some details on setting up the product and services in QuickBooks Online (QBO).

 

Since you’re not tracking your employee within QuickBooks Online, you can consider on creating separate services items for each employee with different pricing based on their daily cost then include their markup within the service price itself or separate item, depends on what you want for your business. When creating an invoice for a project, select the items that you have created.

 

Furthermore, it is best it is best to consults your accountant so you’ll be guided on the proper way to track the money on the equipment package even though it’s not listed as product or services and was purchased from a vendor.

 

 If you don't have an accountant, I can help you find one. Feel free to visit this page to find an accountant for your business: Find a QuickBooks Advisor.

 

Moreover, scan through this article to learn about adding product and service items in QBO: Add product and service items to QuickBooks Online. 

 

Let me know if you have further inquiries about QBO’s product and services feature. I’ll be here to assist you at any time. Have a good one!

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