Monday, August 29, 2011

QuickBooks: Internal Spoilage Tracking by Job

I recently learned of a printer that must sometimes re-run jobs for picky customers. His expenses are already counted in the bottom line (payroll, toner, paper, utilities), but he wanted to track the estimated costs of these spoiled jobs so that he can see which clients are too much trouble to keep. He knew that any of the extra costs related to the job would inflate the client’s expenses.

The solution:
- A new item was created called “Spoilage”
- It was linked to a revenue account that never gets used.
- The item had a price of $0.

Every time they re-ran a job for a customer, they would issue an internal sales receipt for that customer, citing the item “Spoilage” and the quantity being the estimated dollar amount of the extra cost

These sales receipts did not affect the receivables or statements, and he was able to run Sales by Customer Detail reports filtered just for this Spoilage item. The Qty column provided the internally-calculated estimated costs of these spoiled jobs.

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