I sometimes have to recharge clients for items purchased on their behalf - stationery/stamps/telephone rental etc.
I assume these should be charged as Cost of Sales but wonder how this is done? I have set up a nominal code called cost of sales - client items but they show up on my P&L under turnover rather than Cost of Sale.
Dawn
You’ve taken care of posting the sales side of the expenses to re-billed, although you may also want to rename the nominal code to ‘Client Expenses Re-billed’, the reason being is that the cost of sales is related to the purchases.
In order to net off, you will also need to enter the purchase side, as detailed below:
Create a new nominal code under the purchases (5000 - 5999) range called ‘Cost of Sales: Client Expenses’
Set up the client as a new supplier called ‘Expenses - [Enter Client Name]’ or you can set up a general client to use for all one off client assignments, enter ‘Zero’ in the ‘Default VAT Rate’ as this will be claimed later when entering the actual expenses, finally select ‘Expenses - [Enter Client Name]’ as the 'Default Purchase Category.
When tagging the expenses incurred on behalf of the client, select ‘Payment to a supplier’ and then ‘Create a new purchase record for this transaction’, select the Client set up as a supplier in step 2 and enter the ‘Description’, the default Cost of Sales category ‘Cost of Sales: Client Expenses’ should automatically be selected as a default, finally click to save. This will allocate the expenses incurred to the relevant client supplier account and can be used to track expenses incurred for a client, prior to re-billing.
You can now see that both the expenses have been re-billed and the related purchases have also been posted, therefore the net effect on the P&L Account is £0.
You may also find the following posting helpful:
Hi Joe, I’ve migrated from another software and am now trying to use Quickfile. Until now all has gone well, but today I’ve hit upon a big problem: for my out of pocket expenses and company miles:-
I normally pay the expense personally and then claim it back, posting it to directors loan account and then posting reimbursement to the same account. it works and I can see how much I’m owed at any time
Recently I’ve started to work as an agent for another company and in many cases I’ve had to re-bill.
the problem I’m having is re-billing is there a way to select an expenses journal entry and create a bill to a supplier from it?