what's the most important thing that a contractor needs to know a contractor needs to be able to
track expenses and profit by job if you have any questions about this topic you can leave
them in the comment section below and I'll do my best to help you and of course if you feel the
video helped you I hope you will click like and don't forget to subscribe to get updates on new
videos that come out all the time QuickBooks Online can track expenses and profits by job
QuickBooks Online calls this feature tracking expenses by customer we activated this feature
in the prior video regarding changing account settings each expense bill and check that you
record will have a field to put in the job or customer that it relates to you can then check
the results in the report called profit and loss by customer let's add vendors to the vendor list
and add transaction list by vendor to the custom reports tab we click the reports tab in the left
panel then go back to the standard list of reports and scroll down very slowly until you get to the
section of vendors and expenses now here in the expense and vendor section we have transaction
list by vendor click on it then go to the pull down date menu choose all dates click run report
now click Save customization and then again click Save now when we click reports and go over to the
custom reports tab we see that we now have added transaction list by vendor to our list of reports
that we go directly to to navigate QuickBooks Online now let's add this list of vendors and
we'll read them off one by one you will find that adding vendors to the vendor list is exactly the
same as adding customers to the customer list if you remember for customers we clicked sales and
went to customers and then we click new customer so it's the same thing we click expenses and
vendors and because this is the very first time that we're coming to this window we're going to
click Add vendor manually now well I'm gonna click don't allow don't worry about that but notice the
ad vendor window is the same and I think the first one is rex repair shop CAPITAL LETTERS
now of course in a real situation we would add the other information like address and phone
number and so on but right now we're just trying to set up our QuickBooks for the course so we're
just going to click Save for the first one now if you have visited this window before this is what
the window will look like when you first come here obviously - what we just added so to add
new vendors from now on we click new vendor come back to this very same window lonna the lawyer
and of course click Save now we have two vendors
on the list who's next UPS and FedEx respectively new vendor
save new vendor save who's next we're almost done bill the independent builder
I should have put Bob the independent builder but we'll go with Bill save
almost finished with this part staples office supplies and Home Depot new vendor
and the last one will be Home Depot okay save now if you look at the vendor list it looks very very
similar to the customer list and you can always come here and you can always edit any vendor
by clicking on their name in the list and then once their information is in front of you click
Edit and you can change any of the permanent long-term information about your vendors now
let's do an example let's imagine on February 25th we paid 300 dollars for a delivery needed
on the Kirschbaum South Woods Road job and we paid this with transfer number one two three
four five and we will use the expense window to record this so we click expenses and expenses and
of course because this is the very first time that we are coming to this window we get this
little message so you would click add expenses manually and then you would come here you might
get a couple of other pop-ups if it's the first time coming to this window so click past them
so that you can get to the expense window now we know that we paid UPS and we know that we
paid on February 25th so you have to change the date to whatever you need to to make it February
25th now we can skip payment method if you paid online but you should put the transaction number
that the bank gave you when you transfer the money to UPS and of course the money amount is
down here as $300 now clearly if we're paying UPS the expense category is delivery expense but the
most important thing to notice in this window is the customer field you have to click the pulldown
and choose the Kirschbaum South Woods Road job in order to make sure that quickbooks online
knows that this is specifically an expense for that job now when you click Save and close you
can check the results in your profit and loss by customer click reports and go down to profit
and loss make sure you're in the custom tab and go down to profit and loss by customer now you
can see if you scroll all the way to the right ok this is the South Woods Road Kirschbaum job
we have one thousand one hundred and twenty five dollars in income for invoices that we made for
that job in Prior videos and that income is this category income from heating repair but if you go
down a little more you can see that we also had to pay three hundred dollars in delivery expense
that relates to the Kirschbaum job in order to earn that eleven twenty five so right now the net
income or the net profit from the South Woods Road building job is only eight hundred and twenty-five
dollars to understand this better let's do a second example let's imagine on February 28th
we gave cheque number 28 to Lana the lawyer for legal work done on the South Woods Road job for
Kirschbaum and the amount of that checked was two hundred dollars so recording a check in QuickBooks
Online is almost exactly the same as recording an expense the way we did a moment ago we click new
go to the column of vendors and come down to check now the person whom we paid was lana the lawyer
and the date that we paid her was February 28 and the check number that we physically
handed to her had number 28 on it now obviously if we're paying a lawyer the expense that we're
paying in our chart of accounts would be legal and professional services and the amount of that
check was $200 the last thing we have to put is the specific job or customer that this expense
relates to so we click the pulldown and we choose the Kirschbaum South Woods Road job when we click
Save and close we come back to reports custom profit and loss by customer and then we have
to scroll over to the Kirschbaum job now take a look we have income from heating repair for
the South Woods Road building job one thousand one hundred twenty-five dollars but in order to
earn that 1125 for that job we had to pay three hundred dollars of delivery for that job and
two hundred dollars of legal and professional services for that job so if the total expenses
for that job were five hundred that means right now were only running a profit of six hundred and
twenty five dollars for that job in closing we should really check the trial balance to
see that any expense you record regardless of which job it applies to is an expense for the
entire company watch reports and go down to trial balance and you can see that the company now has
delivery expense of three hundred and legal and professional expense of two hundred and if we
use these expenses for other jobs the previous report would separate them by job but the trial
balance would lump together as the total amount of expenses you will also notice that cash and
bank has decreased for both of the expenses we just paid and if you double-click the balance of
cash and bank and scroll down you can see that these were payments that we received from jobs
but here's the February 25th expense and if we scroll to the right you can see it lowered the
balance by 300 come to the left you can see the check that we recorded on February 28th tollana
further lowered the balance by 200 and that's why the company is left with 3500 in the bank account