Reference no: EM132603540

Question - Six months ago, a client with a carpentry business purchased various types of timber in bulk and expensed them. The business is part way through completing multiple projects and has calculated that $1,200 of materials have been used. The cost is to be split evenly over three jobs and recharged to the customer.

Which QuickBooks Online method should be used to ensure that the costs are captured correctly, enabling the client to re-charge the expenses to their customers when the invoices are issued for the work done?

1) Create Journal Entry to credit cost of sales, followed by three further lines where the debits are adjusted to cost of sales but associated with the jobs and marked as billable.

2) Create zero-dollar expense. On the first line, enter a positive value of $1,200, followed by three positive expense lines of $400 associated with the customers and marked as billable.

3) Create zero-dollar expense. On the first line, enter a positive value of $1,200, followed by three negative expense lines of $400 associated with the relevant customers and flagged as billable.

4) Create zero-dollar expense. On the first line, enter a negative value of $1,200, followed by three positive expense lines of $400, each associated to a customer and marked as billable.