Sale of customer service contracts

To record the sale of customer service contracts in QuickBooks, you can create an invoice or sales receipt, depending on whether you receive payment at the time of the sale or bill the customer for the service contract. Here’s how to do it:

Option 1: Create an Invoice (Deferred Payment):

Step 1: Access the “Invoice” Option:

1. Go to the QuickBooks homepage.
2. Click on the “Create” button (usually represented by a plus “+” sign) at the top of the screen.
3. Under the “Customers” column, select “Invoice.”

Step 2: Enter the Invoice Details:

In the “Invoice” window, provide the following information:

• Customer: Select the customer who is purchasing the service contract.
• Invoice Date: Specify the date of the invoice.
• Due Date: Set the due date for payment, which may be in the future if it’s not a one-time payment.
• Product/Service: Add the service contract as a product or service item. If it’s not already in your product or service list, you can create a new item.
• Quantity: Specify the number of service contracts purchased.
• Rate: Enter the rate per service contract.
• You can add a memo to provide additional information about the sale, including details about the service contract terms, duration, and any relevant notes.

Step 3: Save the Invoice:

Review the invoice details to ensure accuracy and save the invoice.

Option 2: Create a Sales Receipt (Immediate Payment):

Step 1: Access the “Sales Receipt” Option:

1. Go to the QuickBooks homepage.
2. Click on the “Create” button (usually represented by a plus “+” sign) at the top of the screen.
3. Under the “Customers” column, select “Sales Receipt.”

Step 2: Enter the Sales Receipt Details:

In the “Sales Receipt” window, provide the following information:

• Customer: Select the customer who is purchasing the service contract.
• Payment Method: Choose the payment method used to process the payment (e.g., cash, check, credit card).
• Payment Date: Specify the date of the sale.
• Product/Service: Add the service contract as a product or service item. If it’s not already in your product or service list, you can create a new item.
• Amount: Enter the total sale amount for the service contract(s).
• You can add a memo to provide additional information about the sale, including details about the service contract terms, duration, and any relevant notes.

Step 3: Save the Sales Receipt:

Review the sales receipt details to ensure accuracy and save the sales receipt.

Step 4: Document and Maintain Records:

Keep proper documentation related to the sale of customer service contracts, including contract terms, invoices, receipts, and any relevant paperwork.

Step 5: Reconcile Your Accounts:

After recording the sale, reconcile your accounts in QuickBooks with your actual financial statements to ensure accuracy.

By following these steps, you can accurately record the sale of customer service contracts in QuickBooks, helping you maintain accurate financial records and track your revenue from these contracts.

Let us take the stress out of managing your financial transactions. Our bookkeeper for small business is committed to accuracy and attention to detail.