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TKTransport
September 16, 2023
Question

Sub Contractors

  • September 16, 2023
  • 1 reply
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I am a dump truck broker.  I pay sub haulers for work on hwy projects.  Some of the haulers rent their dump trailers from me.   I would like to deduct a trailer rental fee from their payout and put it in an income account to track the amount coming in for trailer rental fees.  I don't know how to set up the deduction from their bill pay and put it in the income account.  Any help would be greatly appreciated

1 reply

Rainflurry
Rainflurry
September 17, 2023

@TKTransport 

 

IMO, the easiest and best way to handle this is to create a bank Clearing Account and use that to reduce your payout by the amount of the trailer rental fee.  The Clearing Account serves as a temporary holding account so you can apply the income from the trailer rental to reduce the payout.  To do that:

 

1) Set up a bank account in QB called 'Clearing Account'.  

 

2) Create the invoice to charge the sub their rental fee.  Receive Payment on that invoice and deposit it to the newly-created bank Clearing Account.  That books the income from the rental fee and puts the "payment" received into the Clearing Account that can be used to reduce the payout (bill).

 

3) Create the bill from the sub.  Pay down the bill by the amount in the Clearing Account.  This reduces the bill by the amount of the rental fee that was sitting in the Clearing Account.  

 

4) Pay the sub the balance due on the bill.

 

The Clearing Account should now be $0.  You have booked the income from the sub's invoice, recorded the expense from the sub's bill, and reduced the payment of the bill by the invoice (income) amount.  

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