In QuickBooks, you don’t typically “sell” customer consulting royalties because royalties typically represent income or revenue your business receives from licensing or selling intellectual property, not a product or service you sell to customers. Instead, you should record the income from consulting services or royalties in your accounting software.
Here’s how you can record income from customer consulting services or royalties in QuickBooks:
- Set Up an Income Account:
- Go to the “Lists” menu and select “Chart of Accounts.”
- Click “Account” at the bottom and choose “New” to create a new account.
- Select “Income” as the type of account and name it something like “Consulting Income” or “Royalties Income.”
- Record Income:
- Go to the “Customers” menu and select “Create Invoices” or “Enter Sales Receipts,” depending on how you typically bill your customers.
- Choose the customer or entity that is paying for your consulting services or royalties.
- In the “Item” column, select a service item that represents your consulting services or royalties income. If you haven’t created one, you can set it up in the “Item List.”
- Enter the quantity and rate for the services or royalties. QuickBooks will automatically calculate the total.
- Ensure that the “Income Account” field is set to the “Consulting Income” or “Royalties Income” account you created in step 1.
- Save the invoice or sales receipt.
- Track Income:
- QuickBooks will now track the income you receive from customer consulting services or royalties. You can view this income in various reports, such as the Profit and Loss statement and Income Reports.
By following these steps, you can accurately record and track income from customer consulting services or royalties in QuickBooks. Always consult with a certified accountant or tax professional to ensure you are categorizing income correctly and complying with local tax and accounting regulations. Additionally, QuickBooks may have undergone updates or changes since my last knowledge update in September 2021, so it’s a good idea to refer to the latest QuickBooks documentation or reach out to their support team if you have any questions or need assistance with specific features or issues.
QuickBooks is a versatile accounting software that simplifies financial management for small businesses, often in collaboration with a dedicated bookkeeper for small business owners.