Common Errors associated with Products and Services
All Products and Service items are linked to at least one chart of account category. The most common use of a Product or Service item is when creating an invoice because it is not possible to code an invoice directly to a chart of account code.
The benefit of using a Product or Service item is that you can have lots of different service offerings, but they could all have the sales figures credited to the same chart of account category, such as Fees or Sale of products.
For QuickBooks reporting, it may be the business owner's preference to use many different chart of account categories to reflect different income types. This isn't necessary when you can run reports such as Sales by Product/Service Summary.
The following profit and loss report shows the use of five different chart of account categories for Income:
Figure 9.7 – Income categories in use
It's been found that some...
