and now we will learn how to set the billing preferences this is also called the billing
defaults right now by default expenses per job are marked as both billable automatically and
putting our expenses on a client's invoice makes the expense for us become zero let's
change the default so the job related expenses are not automatically marked as billable from
the main menu we click Edit preferences we scroll all the way down to time and expense the very last
category of preferences in the company preference tab we're going to click mark all expenses as
billable now it's set this way by default but if we click to remove the check mark that means when
we record a check or enter a bill from a vendor it will not automatically mark it as billable and we
will have to place the check mark ourselves click OK and let's take a look at our first example
on March 1 we paycheck number 3 to grec on for a demolition service for the hansen place job brown
company $300 from the main menu click banking write a check the date has to be put forward or
backward depending on when you're watching this video to March 1 of 2017 the company we paid was
grec on demolition now the amount we paid was 300 on the left of your keyboard push the tab
key go to the bottom left and choose the expense demolition expense but this is demolition expense
specifically for the hansen place job under brown company aha notice the billable box is not checked
off by default that's because a moment ago we removed that option in the Preferences window
it just so happens this is billable so we'll click the checkmark and we'll click Save and close now
when we open the unbuilt cost by job we see that check will be there until we bill we bill brown
for that particular demolition job now let's see if it works on a bill March second we received
bill number seven 171 from UPS for a delivery delivery that relates to the hansen place job
two hundred dollars let's take a look at how to rule from the main menu click vendor enter bill
the date on the bill is March 2nd the reference number on the bill is 7 1 7 1 the money amount
of the bill is $200 and the vendor is UPS we go down to the bottom left and click directly under
the word account click on the arrow and choose the livery expense now we're almost done we just have
to tell QuickBooks that this particular expense is for the Hanson Place job notice when we chose
Brown company hands in place job the check mark is not there in the billable box because we remove
the default let's click to place it ourselves then we'll click Save and close and now when
we look at the unbuilt cost by job we can see that that bill is on this report waiting to be
placed on an invoice the next billing default we will discuss is tracking reimbursable expenses
as income now you may well ask what does it mean to track reimbursable expenses as income it means
when billable expenses are added to a client's invoice the expense stays in the expense account
and the reimburse techs are added to the income of that invoice now this is different behavior
than we saw in the previous video what are the steps to set up the track reimbursable expenses
as income feature first we have to check the box in the Preferences window let's do that now from
the main menu click Edit preferences now scroll down to the same place we were earlier time and
expense click the company preferences tab and now we will click the checkmark here track reimbursed
expenses as income now we click OK and step one is finished now let's discuss the next two steps
we have to create matching income accounts for the reimbursable expenses that we wish to track
as income after we create these accounts we will edit the original expense accounts to be able to
connect them to the matching income account now what does that mean matching account well in our
previous example we had demolition expense and that means we have to create an account called
demolition fees that will hold the income when we put the demo the reimbursable billable expense of
demolition on to the invoice same thing with delivery expense in our previous example we
have to create an account called delivery fees that will track and record the income that we
put on the invoice when we ask the customer to reimburse us for delivery expense so let's do
this let's create a matching income account for the reimbursable expenses that we wish to track
as income we can open the chart of accounts from the main menu list chart of accounts from the
bottom left click account new now these accounts are income accounts click continue and we will
put demolition fees and then we'll click Save and new make sure the account type stays income and
we will put delivery fees click Save and close and these will be the income accounts that will record
the income when we put the billable delivery and billable demolition on to an invoice and now the
final setup step edit the expense accounts of those expenses to connect them to the matching
income account very simple if you don't have the chart of accounts still open you should reopen it
and now let's go to delivery expense click on it then click account edit account we have to click
this check box and then from the delivery expense account edit window after clicking the checkbox
that says track reimbursed expenses as income click the arrow and find the matching income
account in this case delivery fees so it will be delivery expense before we are reimbursed and it
will be delivery fees after we are reimbursed by the client click Save and close and we'll do
the same thing for demolition expense click on it click account edit click the checkmark next to the
box that says track reimbursed expenses in income account and we will choose the demolition fees
now click Save and close now we're ready to enter invoices where we can put the reimbursed expenses
and they will show up as income now let's see if it works let's imagine on March 5th we build Brown
company for 10% more of the handsome place job and we will include the March 1 demolition from
grec on from check number 3 before we record the invoice let's take a quick look at the profit and
loss by job right now we have demolition expense 300 after we make the invoice and put this expense
on the invoice this expense will now stay which is not what happened in the previous video when the
preference was set differently but in addition to this staying you will see for the first time
demolition fees show up in the income section of this report let's take a look at how to record it
open the invoice move the date forward to March 5th of 2017 now choose the hands and place job
under brown company and of course we're taking the information from the main estimate click OK just
like in a previous video we click create invoice as a percent the instruction said we finished
10% more of this job - since the last invoice when we click OK not only does it populate the
invoice with 10 percent of the estimate but it also has this message popping up billable
time and cost and yes we're going to select the outstanding time and cost click OK and we have
two expenses in this case we're going to click the check mark in the margin of the construction
and demolition for $300 when we click OK the $300 has been added to this invoice and when
we scroll down we can see $300 has been added to the invoice as a result of what we just did when
we click Save and close oops excuse me when we click Save and close we can open the profit and
loss by job and we can see the demolition expense is still here but demolition fees has shown up
for the first time in this report in the income section under Hansen place because in addition
to earning income from heating we also earned income from demolition fees $300 and of course
our last example March 7 billed Brown company for 5% more of the handsome place job we will include
the March 2nd bill number 7 171 from UPS for the delivery that relates to the hansen place job
again we open the invoice window we move the date forward to march 7 of 2017 we choose the hands
and place job of course was still working from this main estimate so click OK this time we're
only billing them for five additional percent complete from this job when we click OK we have
the opportunity to select the outstanding billable time when we click OK there's only one expense so
we'll click the check mark in the margin then when we click OK we will scroll down and see
that that expense has been added to this invoice now when we click Save and close OOP scuse me for
some reason this is on click Save & close and we look at the profit & loss by job now we can see
that the delivery expense is still there for the Hansen job which is opposite from what happened
in the previous video but you can see even though this is still here what balances that out is that
deliveries fees shows up for the first time in the income section under the Hansen place job