Invoices

[BGP]

Maf. King wrote:
> On Thursday 17 December 2009 22:23:21 BGP wrote:
>   
>> I probably don't understand how to create an invoice properly
>> but....here's what I've done-
>>
>> I create an Invoice that includes the hours I've worked and the amount
>> per hour.  That works fine.
>>
>> Then I include the material charges for the work done.  The material
>> charges are entered in the description area.  But, I can't include
>> Expense accounts in the invoice.  So, I put the a MINUS sign next to the
>> material charges and it all works out well.
>>
>> Is that the way to do it or is there another way?
>>     
>
> Hi BGP,
>
> I think that you are wrong to be trying to use an expense account for 
> materials in an invoice. Surely a -ve line total reduces the invoice total?
>   
"expense account"  I probably should've said Income account as that's 
the line I enter my labor costs on in the invoice.  There are no other 
choices I can make for the invoice. 


 I'm probably doing the wrong thing but the results work out well.  I'm 
probably making a mess for myself that'll appear in the future if I 
don't do it correctly now.
> It sounds to me that you are trying to "reduce" your expense account totals by 
> selling materials on, and that is Not The Way To Do It.  
> You buy stuff. You sell it on. 
"sell it on"....what does that mean?


> Taxable Profit = Total Income - Total Expenses 
> (simplistically, at least).  Your way sounds like you aren't selling 
> materials, but actually reclaiming expenses, and that doesn't really belong 
> on an invoice.
>   
Expenses are part of any job.  You buy material for a job and that 
becomes part of the cost you have to get paid for along with your labor.

> I don't charge materials on in my business so I'm hazy on the exact details 
> here, but IIRC you may need a COGS (cost of goods sold) account which 
> balances transfers between Income:Sales, Assets:Stock-In-Hand, and the 
> relevant Expense accounts.
>   

IIRC....what's that?  Do you mean IRS or Title 26?
> Hopefully others will be able to chime in with some insight!
>   
>   

I hope they do as I have no idea what you're talking about.
>
>