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charlene767
August 25, 2023
Question

how to categorize an invoice to show correctly on P&L

  • August 25, 2023
  • 2 replies
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how to categorize an invoice to show correctly on P&L

 

2 replies

Rainflurry
Rainflurry
August 25, 2023

@charlene767 

 

When you create an invoice, the category selected under 'Income account' for the product/service on the invoice is the category that will show on your P&L.  There will be an offsetting amount to accounts receivable (A/R) if you're on accrual basis.  If you're on cash basis, the 'Income account' selected will show on your P&L only after you receive payment on the invoice.   

R
rvrfrf
August 25, 2023

Thanks for becoming part of the Community, charlene767.

 

You can categorize transactions from your Banking page.

 

Here's how:
 

  1. In the left navigation bar, go to Banking, then Banking.
  2. Find a transaction you want to categorize on your For review screen.
  3. Click its record to expand the view.
  4. Tick your Categorize radio button if necessary.
  5. From the Category * drop-down list, choose an appropriate category.
  6. Enter any other necessary details.
  7. Select Add.

 

You can also create bank rules to automatically categorize transactions for you.

 

If you're unsure of which category you should be using to categorize a particular transaction, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

 

I've included a detailed resource about categorizing transactions which may come in handy moving forward: Categorize online bank transactions

 

Please feel welcome to send a reply if there's any additional questions. Have a wonderful Friday!

S
scagliarini
March 13, 2024

Actually, I can't do that because the paid invoice is recorded in qb and if I also enter the bank deposit as a transaction it becomes a double entry, overstating income. So the question remains, how can I categorize an invoice paid and recorded in income. I want for example to group my 1099 income differently than my other income

 

M
Maybelle_S
March 13, 2024

I want to ensure this is taken care of, scagliarini.

 

To categorize and invoice payments recorded as income accurately, you can review the product you're using in QuickBooks Online (QBO). Then, select the appropriate income account. It ensures that your Profit and Loss report reflects the correct income and groups your 1099 with other income categories.

 

Here's how:

 

  1. Go to the Sales menu.
  2. Select Products & services.
  3. Choose the item you've used and click Edit.
  4. In the Income account drop-down arrow, select the correct account.
  5. Hit Save and close.

 

I've added some resources to help you in the future. These articles contain information about customizing financial reports and steps to fix when income is missing in your data.

 

 

Let us know if you have more questions or need further clarification on your reports. We're here to ensure your understanding of your financial data.

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