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Cking13
July 21, 2024
Question

Cost of goods sold (expense) counting towards revenue

  • July 21, 2024
  • 1 reply
  • 0 views

With my current contractors license, I am only allowed to have a certain amount of revenue for the year. When I enter a receipt in QuickBooks under cost of goods sold (materials and parts) it is counting towards my revenue so it makes it harder to keep up with actual revenue. Why is it doing this?

    1 reply

    JoesemM
    JoesemM
    July 21, 2024

    Hello there, Cking13.

     

    QuickBooks Online (QBO) treats COGS (Cost of Goods Sold) differently from regular expenses to give you a clearer picture of your business's profitability. COGS reflects the direct cost of producing or purchasing the goods you sell which includes the cost of materials, parts, and labor directly involved in making the product.

     

    Also, COGS gets subtracted from your sales to show your gross profit, not added to your revenue. Even though COGS appears in your sales figures in QBO, it ultimately gets subtracted to determine your gross profit.

     

    On the other hand, could you please indicate the part in the COGS that reflects revenue? Adding a screenshot would be helpful for clarity and accuracy in resolving your concern.

     

    I'll add these articles to learn more about how the cost of goods sold works in QuickBooks Online: 

     

     

    I'm just a post away if you have any more questions about tracking entries in QuickBooks. I'm here to help. Have a great day!

    C
    Cking13Author
    July 21, 2024

    You can see my supplies and materials are counting towards revenue, but I build that into the prices I’m charging customers. Maybe I am entering them incorrectly?

    M
    MelroseV
    July 21, 2024

    Allow me to chime in on this thread, Cking13.

     

    I'm having difficulty opening the screenshot you provided in the Community. Please try uploading another image and give more details about your inventory to help us understand your concern better.

     

    We appreciate your cooperation. Once you have uploaded a new screenshot and provided the additional inventory details, we can address your concern more effectively. Thank you for being so patient, and we look forward to assisting you further.

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