and now it's time to learn how to build clients for items billing clients for items involves
several things if you record buying these items on a check or a bill then they must be two-sided
items two-sided items are items on the items list that have both a purchase cost and a sales price
set up for them in the items list the cost must be connected to a cost or expense type of account
and the price must be connected to an income or sales type of account for example let's sell our
clients wallpaper as part of the renovation job first we will create an account called income
from wallpaper sales and that will be an income type of account then we will create an account
called cost of wallpaper sold and that will be an expense type of account let's take a look
at how to add these to the chart of accounts from the main menu click list chart of accounts in the
bottom left click account new of course the first one is an income type of account and the name of
it should be income from wall paper sales and then we can click Save & new and see that it has been
added to the chart of accounts the next one can either be a cost of goods sold type of account
if your inventory module is active or an expense type of account if you don't want to activate the
inventory module in this example we'll keep it simple it's an expense and we'll call it cost of
wallpaper sold cost of wallpaper sold when we click Save and close now we have both cost of
wallpaper sold and income from wallpaper sales on the chart of accounts the next step is to create
an item called wallpaper we'll give the price $50 per unit and the cost $20 per unit let's take a
look at how to put this on the items list from the main menu click list item list go to the bottom
left and click item new now when deciding what type of item you should choose regarding the item
type it can be either a service or a non inventory part because a service and a non inventory part
are the only items available that can have both a purchase cost and a sales price for inventory
parts or any other information you might need about two-sided items please take the inventory
course in our example it seems more appropriate to choose non inventory part now right now there is
no place to put in the cost information only the price you must click the check mark in this box
this item is used in assemblies or is purchased for a specific customer or job click the check
mark and when you do that the fields open up and you have the ability to put in both the purchase
cost and the sales price the name is wallpaper the purchased cost $20 the sales price $50 okay
now let's make sure that it's consistent with what the instructions say and obviously we're
going to connect the cost to the account we made cost of wallpaper sold so every time we purchase
this item and we put the purchase on a check or a bill this account cost of wallpaper sold
will increase for the sales price we're going to choose the account income from wallpaper
sales so every time we put this same item on an invoice or even a sale receipt it's the $50 that
will come up as the money amount and it's this account that will increase when we save that
invoice or receipt click OK and you can see we have successfully added this two-sided item to
the items list so let's see how it works let's imagine on April 2nd we paycheck number 6 to
Staples for 50 units of wallpaper that's billable to the brown company for Mockingbird Lane can you
guess the money amount per unit well since this is a check and we're buying it $20 each unit
of wallpaper will be the cost that comes up on the check let's take a look from the main menu
click banking write a check QuickBooks remembers were up to check number 6 the date is April 2nd
of 2017 the vendor was Staples now don't worry that we have open bills with staples just click
continue writing a check do not I repeat do not click into the money amount field instead click
the items tab and choose the wallpaper notice $20 per unit automatically came up all we have
to do is put the quantity in the same row in this case it's 50 push tab and QuickBooks will
calculate the money amount by multiplying the quantity that you're buying from this check by
the cost each we know for sure that this is for the Mockingbird Lane job and we'll leave it as
billable to brown and that's all you have to do when you put it on check just be aware if the
if the window that you're recording the item on is a check the cost will come up not the price
so we will click Save and close and now we will take a look at a profit and loss by job and you
can see for the Mockingbird Lane job we now have a new expense cost of wallpaper sold a
thousand dollars which decreases the profit until we put it on an invoice for brown and now let's
see what happens on April 5th when we bill Brown for the wallpaper that we purchased on April 2nd
that was related to the Mockingbird Lane job we opened the invoice window just like we've done
many times before put the correct date choose the correct customer and job and look we now
have the billable time and cost window opening up when we click OK we see that there are no
expenses time or mileage but there is one item waiting to be billed when we click the checkmark
to tell QuickBooks this is the item we click ok and we now see 50 units of wallpaper come on to
this invoice but notice this very same item that was $20 each on the check is now $50 each on the
invoice and that's all you have to put if that's all you're billing the client for click Save and
close don't worry about the mistake in the default just click Save and close now when we open the
profit & loss by job you can see that wallpaper or income from wallpaper sales has increased the
income of the Mockingbird Lane job by 2,500 and it had no effect on the cost when we purchased it