Invoices

[Maf. King]

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?

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. 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.

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.

Hopefully others will be able to chime in with some insight!
Maf.