How to Add a Service Item to the Item List in QuickBooks 2014 - dummies

How to Add a Service Item to the Item List in QuickBooks 2014

By Stephen L. Nelson

In QuickBooks, you use service items to purchase or bill for items that represent service. For example, if you were a CPA, one of the things that you probably would do is prepare tax returns for individuals and businesses. When you bill a client for preparing his or her tax return, the line item that appears in the invoice for Tax Return Preparation is a service item.

In your business, you probably have service items, too. For example, a health-care provider, such as a dentist or doctor, provides treatment or performs procedures. Dentists might fill cavities. Doctors might perform physicals or give vaccinations. These activities represent services.

Even retailers and contractors — businesses that you typically think of as selling tangible physical goods — often sell services. For example, a retailer may gift-wrap a purchase, which is a service. A contractor may provide services such as painting and cleanup.

To add a service item, display the New Item window, and select Service from the Type drop-down list. In the Item Name/Number box, give the service a brief code or name. If the service is a subitem, select the Subitem Of check box and identify the parent item.

Select the check box titled This Service Is Used in Assemblies or Is Performed by a Subcontractor or Partner if the service is provided by (as the window suggests) a subcontractor, owner, or partner. You indicate which services are performed by subcontractors, owners, and partners because these parties are subject to different tax accounting rules.

Next, use the Description box to describe the service. Your description appears in invoices and purchase orders, so you want to be thoughtful here. Use the Rate box to describe the price or rate per unit of service. Use the Tax Code box to indicate whether the service is taxable.

Finally, use the Income Account box to identify which income account should be credited when the item is sold to some customer, client, or patient.