Hey again @Product_guys
I'd just like to let you know that we at Wave support are not accountants. We would hate to give you erroneous accounting advice and I would highly recommend reaching out to a CPA about this.
Perhaps it's best if I leave this post open to some other accountants out there who could offer some advice!
Hey @Product_guys , I see Barsin's comment above but I do think I may be able to help you here.
Because the product income is associated to the product itself, it sounds like the reimbursable expense is still appearing because that's what your products are associated to. If you go into the products themselves that are associated on the invoice, change the Income account, and then remove/re-add your product on these invoices (with the new income account associated), this should take care of your issue.
Am I able to charge both parts and labor on the same ticket with different headings? Or would I need to just keep it items, quantity, and price and add my labor and hourly rate accordingly?
Would you mind providing a bit more context as to what you're looking to accomplish here? A real-world use case scenario would be help and I could gladly try to help you out! Thanks.
Is it possible to automatically create an expense item from a scanned receipt ? In your example you have $100 travel expense paid in cash. What say it was parts paid by debit card from Current account and receipt is scanned in. I want the receipt to be selectable when creating the invoice as these parts are paid for by the customer ie reimbursed to me.
@ChrisHA It sounds as though you are hoping to attach receipt images to invoices. At the moment, attachments to invoices or estimates are not something that can be done in Wave, which is why the current workflow exists.
@tsfjax In Wave, the income account is not done on an invoice level, but on the product level. This means that if you are looking to adjust an income account, you will need to edit the product's income account in order to make the change. This also means that if you have multiple products on an invoice, the income related to each product will be distributed to each of the corresponding income accounts. As a special note, edits to product income accounts mean that it will effect any invoices moving forward, but past income will need to be adjusted on the account level. This means that you will want to find the old transactions (by sorting by the income account) and then editing the account to the new income account in bulk.
Why can't us as business owners just buy a part to complete a job and then bill the customer for that part along with any other charges we need to bill for, ie. labor?
What I'm getting at is, in the accounting software I use now, when I buy a part from a vendor I'm able to link it to the specific customer for billing later. I do this by recording the expense in my card or bank account and attach it to a specific customer. When I invoice the customer, I'm able to select any outstanding items that need to be added to the customers invoice for billing. Then I'm able to add more line items for the labor, for example.
Using wave, as a small business that buys parts on behalf of a customer then bills the customer, seems a bit convoluted for such a powerful accounting solution. I understand it's free, and I greatly appreciate that, but your 'selling' point is how easy it is for businesses to use.
@JF_1009 said:
I am really confused by this. I have recorded the reimbursement as you have instructed and that worked. However, this is not recorded as COGS or any type of expense on my P & L statement - the expense is only offsetting the income in the income account. I have been a bookkeeper for 15 years and have always been told by accountants that expenses are expenses even if you charge the client for them, fully, partially or marked up. I have been using Sage50 for years and am trying out Wave with a few smaller clients to try to simplify things. Do you not follow normal accrual accounting methods? I am wondering if I am going to be able to use Wave at all...please advise.
Totally @JF_1009 - this is my understanding too - Wave is not doing it how I was taught either.
If I fly, or stay in a hotel and this is reimbursable, those expenses need to go to appropriate expense accounts (Air Travel and Accommodation respectively) - they are COGS. (Actually I have two of each of these expense accounts... one for expenses that are not reimbursed and one that are - a manual work around so I can separate COGS and SG&A for these categories of expense.
Then I have a product for each of the reimbursable types of expenses (so they appear nicely on the invoice), all these have an income account of "reimbursed expenses". So I'm essentially selling different types of reimbursable expenses :-)
In theory at least if I were to sum up the reimbursable expense accounts with the reimbursed expenses income for a period of time is should be zero! :-)
So it appears for me Wave is at v0.1 for Expenses functionality... and I can't use it as it is currently since my accountant would have fits because my COGS would be no where! :-(
However, slowly but surely Wave have been improving most aspects of the product, and they do like to focus on anything to do with Income / Invoices... so I have no doubt this will get improved soon! :-)
@ChrisHA said:
Is it possible to automatically create an expense item from a scanned receipt ? In your example you have $100 travel expense paid in cash. What say it was parts paid by debit card from Current account and receipt is scanned in. I want the receipt to be selectable when creating the invoice as these parts are paid for by the customer ie reimbursed to me.
@ChrisHA this would be super useful. You can "tag" receipt txn with a customer name after you've posted it, but I can't figure out how to get a report that lists expense item by customer. Further there is no way to add a the receipt txn to an invoice and have the image on the receipt be auto-magically part of the invoice.
I guess this is all in the next release of this functionality by Wave :-)
Dear Wave - recommendations on how to handle withholding tax? I invoice an amount but a % is withheld from the invoice amount. So payment is always "short". I presume it is similar to a reimbursed expense? Your guidance will be appreciated!
I think you might find some benefits in checking out this community thread for sorting out your income taxes in Wave! Let us know if you have any questions.
Is there any feature available, where we can check entire transactions with a customer (whether reimbursable expense or sales), so that we can get to know total amount outstanding (sale amount + reimbursable exp amount).
Currently, in Sales< Customer statements, this is not available.
I am having an issue when it comes to payment of the invoice. My customer paid their normal monthly fee of $500 but failed to pay the reimbursement amount of $50.00. When I record the payment of $500 it appears that Wave is allocating some portion of the $500 to the reimbursable expense when it should not. How can I allocate the $500 to a specific line item on the invoice and leave the reimbursable expense outstanding and still due?
Hey @Shrey_Laddha , sorry for the late response here, it looks like we missed your message. You can check your Customer Statement (Sales > Customer Statements) but this will not break down reimbursable expense vs regular income, it will only show what money is owed to you from the customer. You can also check your Account Transactions Report and filter by customer. You then have the choice to filter by the reimbursable expense account to break down more specific numbers.
Hey @MrsHungryAsian , because the reimbursable expense is allocated based on the product / income account associated to the product, if you remove / change the reimbursable product line that you have on the invoice, you should be able to reallocate the money to a more accurate product / income account.
How do we account for foreign transactions? Example, I travelled for a client to Europe and had reimbursable expenses paid in euros. The exchange rate calculated at the time of invoice generation (and payment) is different from the exchange rate on my credit card statement on the day of transaction. As a result, my reimbursed expenses line item in the transaction account does not equal 0.00.
I've followed the instructions and entered dozens of reimbursed expenses and they come up in the chart of accounts under "Reimbursed Expense." But when I create an invoice and click "add item," there is no option to "Edit Income Account" as described in the instructions above, or any apparent option to add an a reimbursed expense.
Hi @Sonal , if there’s a balance left in the Reimbursed Expense account, you can use a journal to put it into a Foreign Gains/Loss account since it represents the difference between the translated invoice amount and the amount actually paid in the business currency.
Hi @aderkon , when you create an account in your Products/Services you have the option to associate it to an income account. You can also go into your pre-existing product/services in their dedicated page and re-associate the account. If you don't choose an account when adding a product/creating it, it will automatically assign it to Sales.
@AlexL thanks for the info. Could you help me out with which account I would debit and which one I would credit when i create the journal entry? Thanks! My Reimbursed Expense account shows a -$30 amount.
Hi @aderkon , when you create an account in your Products/Services you have the option to associate it to an income account. You can also go into your pre-existing product/services in their dedicated page and re-associate the account. If you don't choose an account when adding a product/creating it, it will automatically assign it to Sales.
Hi AlexL,
Thanks for responding. Actually I wasn't asking about creating a product/service but claiming reimbursable expenses on an invoice, according to Wave's instructions. These instructions never mention Products/Services:
Could you please add some more clarification on whether it's necessary to tie reimbursed expenses to a particular product/service, and if so, how it's done?
Hey @Sonal , you can debit the reimbursable expense account and credit the foreign exchange account. This should bring your balance in the reimbursable account to $0.
Hey @aderkon , step 3 in the article mentions:
Create your invoice. On your invoice, the reimbursable expense you’re recording will be a product line item, just as any product or service you would add. When you add the reimbursable expense line, be sure to click Edit Income Account, and select the Reimbursable Expenses account we created in Step 2.
That should explain how you can add a product/service as a line item in your invoice and change the income account to your reimbursable expense account. Because the income account on the invoice is tied to the product itself, you do have to use this method to track it. Please don't hesitate to let me know if you have any further questions!
If Wave is tracking my business expenses on a credit card, do I still need to add an expense on the Transactions page or can I use the existing expense that has already imported from the credit card?
Hi @TJ_ , if you already have your bank account connected for automatic transaction imports, you would not need to manually create those transactions yourself. If the transaction is recorded in your bank account, it should be imported from your connected account shortly and appear on your Transactions page for use.
Hi @AlexL ,
On my invoice, I used "Add an item" and then "Create a new item" to make an item that matches up with a category of my expenses, and used "Edit income account" to select the "Reimbursed Expense" account. But I don't see the reimbursed expenses I entered coming up or any way to add them. How do I put them in the invoice?
thanks,
Konrad
@AlexL said:
Hey @Sonal , you can debit the reimbursable expense account and credit the foreign exchange account. This should bring your balance in the reimbursable account to $0.
Hey @aderkon , step 3 in the article mentions:
Create your invoice. On your invoice, the reimbursable expense you’re recording will be a product line item, just as any product or service you would add. When you add the reimbursable expense line, be sure to click Edit Income Account, and select the Reimbursable Expenses account we created in Step 2.
That should explain how you can add a product/service as a line item in your invoice and change the income account to your reimbursable expense account. Because the income account on the invoice is tied to the product itself, you do have to use this method to track it. Please don't hesitate to let me know if you have any further questions!
Hey @aderkon , do you mean the Reimbused Expense account that you added to your Chart of Accounts? Can you confirm that you added this to the right section? It should be under Other Income under the Income category. If it's not located there it won't appear when trying to select it under the income of your item.
Thanks for sharing your screenshot with me. That's odd. I'm not seeing the same behaviour on my end after trying it in my test account. If you are still experiencing this issue, I suggest actioning some basic browser troubleshooting steps.
Is there any way to make a change to the income/expense category of an invoice after it's already been completed? Here's an example that describes my issue: I have already created and been paid for an invoice with 2 line items: $450 in photography services (categorized as sales) and $50 in mileage (also categorized as sales) for a total of $500 (all categorized as sales).
However, the $50 in mileage isn't really "sales" and it is not taxable income. I mistakenly labeled it sales. I believe I need to change it to Reimbursed Expense (as described in this tutorial) so it does not show up as income in my Profit & Loss statement. Correct?
However, for invoices from the past, it appears I can't just change that $50 item from "sales" to "reimbursed expense." What do you recommend doing? Should I just recreate the invoice with the proper category designations and delete the old one?
Sometimes I'm paid by clients without creating an invoice if it's someone who I often do work for or they have their own invoice system. In this case I just go to the Transactions page and click Add Income. There I can split the transaction and make part of it "sales" and part of it "reimbursed expense" after the fact. But this doesn't seem to be the case with invoices.
Hi, I've completed steps to create a Chart of Accounts and assigned my expenses under Reimbursed Expense, and assigned it to my customer. Now I'm creating my invoice. Do I need to manually type in the expense or is there a way to pull it from my expenses? If you could please include screenshots with the step by step to create the invoice, that would be great. Thanks.
Hey @jstuk , you should be able to go into the invoice, remove the line item that has the wrong income account assigned and re-add it so that it has reimbursed expense assigned. You can actually head into your Products & Services page (under Sales) ahead of time and change the income account there so all you have to do in the invoice is remove and re-add the product.
IN the case that your invoice was paid through Wave Payments and not manually, the above workflow doesn't work but you can change the amount from income to reimbursed expense with a journal transaction.
One of these situations above should solve your issue but if I'm missing something, let me know.
Hey @franmorfini , if you have the expense already in your transactions page, then you can categorize it to Refund for Reimbursed Expense.
Comments
Hey again @Product_guys
I'd just like to let you know that we at Wave support are not accountants. We would hate to give you erroneous accounting advice and I would highly recommend reaching out to a CPA about this.
Perhaps it's best if I leave this post open to some other accountants out there who could offer some advice!
Hey @Product_guys , I see Barsin's comment above but I do think I may be able to help you here.
Because the product income is associated to the product itself, it sounds like the reimbursable expense is still appearing because that's what your products are associated to. If you go into the products themselves that are associated on the invoice, change the Income account, and then remove/re-add your product on these invoices (with the new income account associated), this should take care of your issue.
Am I able to charge both parts and labor on the same ticket with different headings? Or would I need to just keep it items, quantity, and price and add my labor and hourly rate accordingly?
Hey there @klu
Would you mind providing a bit more context as to what you're looking to accomplish here? A real-world use case scenario would be help and I could gladly try to help you out! Thanks.
Is it possible to automatically create an expense item from a scanned receipt ? In your example you have $100 travel expense paid in cash. What say it was parts paid by debit card from Current account and receipt is scanned in. I want the receipt to be selectable when creating the invoice as these parts are paid for by the customer ie reimbursed to me.
I’m not able to change income accounts on invoices. Am I doing something wrong?
@ChrisHA It sounds as though you are hoping to attach receipt images to invoices. At the moment, attachments to invoices or estimates are not something that can be done in Wave, which is why the current workflow exists.
@tsfjax In Wave, the income account is not done on an invoice level, but on the product level. This means that if you are looking to adjust an income account, you will need to edit the product's income account in order to make the change. This also means that if you have multiple products on an invoice, the income related to each product will be distributed to each of the corresponding income accounts. As a special note, edits to product income accounts mean that it will effect any invoices moving forward, but past income will need to be adjusted on the account level. This means that you will want to find the old transactions (by sorting by the income account) and then editing the account to the new income account in bulk.
Why can't us as business owners just buy a part to complete a job and then bill the customer for that part along with any other charges we need to bill for, ie. labor?
What I'm getting at is, in the accounting software I use now, when I buy a part from a vendor I'm able to link it to the specific customer for billing later. I do this by recording the expense in my card or bank account and attach it to a specific customer. When I invoice the customer, I'm able to select any outstanding items that need to be added to the customers invoice for billing. Then I'm able to add more line items for the labor, for example.
Using wave, as a small business that buys parts on behalf of a customer then bills the customer, seems a bit convoluted for such a powerful accounting solution. I understand it's free, and I greatly appreciate that, but your 'selling' point is how easy it is for businesses to use.
Totally @JF_1009 - this is my understanding too - Wave is not doing it how I was taught either.
If I fly, or stay in a hotel and this is reimbursable, those expenses need to go to appropriate expense accounts (Air Travel and Accommodation respectively) - they are COGS. (Actually I have two of each of these expense accounts... one for expenses that are not reimbursed and one that are - a manual work around so I can separate COGS and SG&A for these categories of expense.
Then I have a product for each of the reimbursable types of expenses (so they appear nicely on the invoice), all these have an income account of "reimbursed expenses". So I'm essentially selling different types of reimbursable expenses :-)
In theory at least if I were to sum up the reimbursable expense accounts with the reimbursed expenses income for a period of time is should be zero! :-)
So it appears for me Wave is at v0.1 for Expenses functionality... and I can't use it as it is currently since my accountant would have fits because my COGS would be no where! :-(
However, slowly but surely Wave have been improving most aspects of the product, and they do like to focus on anything to do with Income / Invoices... so I have no doubt this will get improved soon! :-)
@ChrisHA this would be super useful. You can "tag" receipt txn with a customer name after you've posted it, but I can't figure out how to get a report that lists expense item by customer. Further there is no way to add a the receipt txn to an invoice and have the image on the receipt be auto-magically part of the invoice.
I guess this is all in the next release of this functionality by Wave :-)
Dear Wave - recommendations on how to handle withholding tax? I invoice an amount but a % is withheld from the invoice amount. So payment is always "short". I presume it is similar to a reimbursed expense? Your guidance will be appreciated!
Hey there @ChristiaanG
I think you might find some benefits in checking out this community thread for sorting out your income taxes in Wave! Let us know if you have any questions.
Is there any feature available, where we can check entire transactions with a customer (whether reimbursable expense or sales), so that we can get to know total amount outstanding (sale amount + reimbursable exp amount).
Currently, in Sales< Customer statements, this is not available.
I am having an issue when it comes to payment of the invoice. My customer paid their normal monthly fee of $500 but failed to pay the reimbursement amount of $50.00. When I record the payment of $500 it appears that Wave is allocating some portion of the $500 to the reimbursable expense when it should not. How can I allocate the $500 to a specific line item on the invoice and leave the reimbursable expense outstanding and still due?
Hey @Shrey_Laddha , sorry for the late response here, it looks like we missed your message. You can check your Customer Statement (Sales > Customer Statements) but this will not break down reimbursable expense vs regular income, it will only show what money is owed to you from the customer. You can also check your Account Transactions Report and filter by customer. You then have the choice to filter by the reimbursable expense account to break down more specific numbers.
Hey @MrsHungryAsian , because the reimbursable expense is allocated based on the product / income account associated to the product, if you remove / change the reimbursable product line that you have on the invoice, you should be able to reallocate the money to a more accurate product / income account.
How do we account for foreign transactions? Example, I travelled for a client to Europe and had reimbursable expenses paid in euros. The exchange rate calculated at the time of invoice generation (and payment) is different from the exchange rate on my credit card statement on the day of transaction. As a result, my reimbursed expenses line item in the transaction account does not equal 0.00.
I've followed the instructions and entered dozens of reimbursed expenses and they come up in the chart of accounts under "Reimbursed Expense." But when I create an invoice and click "add item," there is no option to "Edit Income Account" as described in the instructions above, or any apparent option to add an a reimbursed expense.
Hi @Sonal , if there’s a balance left in the Reimbursed Expense account, you can use a journal to put it into a Foreign Gains/Loss account since it represents the difference between the translated invoice amount and the amount actually paid in the business currency.
Hi @aderkon , when you create an account in your Products/Services you have the option to associate it to an income account. You can also go into your pre-existing product/services in their dedicated page and re-associate the account. If you don't choose an account when adding a product/creating it, it will automatically assign it to Sales.
@AlexL thanks for the info. Could you help me out with which account I would debit and which one I would credit when i create the journal entry? Thanks! My Reimbursed Expense account shows a -$30 amount.
Hi AlexL,
Thanks for responding. Actually I wasn't asking about creating a product/service but claiming reimbursable expenses on an invoice, according to Wave's instructions. These instructions never mention Products/Services:
https://support.waveapps.com/hc/en-us/articles/115000588103-Claim-reimbursable-expenses-on-an-invoice
Could you please add some more clarification on whether it's necessary to tie reimbursed expenses to a particular product/service, and if so, how it's done?
Hey @Sonal , you can debit the reimbursable expense account and credit the foreign exchange account. This should bring your balance in the reimbursable account to $0.
Hey @aderkon , step 3 in the article mentions:
Create your invoice. On your invoice, the reimbursable expense you’re recording will be a product line item, just as any product or service you would add. When you add the reimbursable expense line, be sure to click Edit Income Account, and select the Reimbursable Expenses account we created in Step 2.
That should explain how you can add a product/service as a line item in your invoice and change the income account to your reimbursable expense account. Because the income account on the invoice is tied to the product itself, you do have to use this method to track it. Please don't hesitate to let me know if you have any further questions!
If Wave is tracking my business expenses on a credit card, do I still need to add an expense on the Transactions page or can I use the existing expense that has already imported from the credit card?
Hi @TJ_ , if you already have your bank account connected for automatic transaction imports, you would not need to manually create those transactions yourself. If the transaction is recorded in your bank account, it should be imported from your connected account shortly and appear on your Transactions page for use.
Hi @AlexL ,
On my invoice, I used "Add an item" and then "Create a new item" to make an item that matches up with a category of my expenses, and used "Edit income account" to select the "Reimbursed Expense" account. But I don't see the reimbursed expenses I entered coming up or any way to add them. How do I put them in the invoice?
thanks,
Konrad
Hey @aderkon , do you mean the Reimbused Expense account that you added to your Chart of Accounts? Can you confirm that you added this to the right section? It should be under Other Income under the Income category. If it's not located there it won't appear when trying to select it under the income of your item.
Let me know if you're still having issues!
Hi @AlexL ,
Yes, the account was added to the right section.
Hey @aderkon !
Thanks for sharing your screenshot with me. That's odd. I'm not seeing the same behaviour on my end after trying it in my test account. If you are still experiencing this issue, I suggest actioning some basic browser troubleshooting steps.
Is there any way to make a change to the income/expense category of an invoice after it's already been completed? Here's an example that describes my issue: I have already created and been paid for an invoice with 2 line items: $450 in photography services (categorized as sales) and $50 in mileage (also categorized as sales) for a total of $500 (all categorized as sales).
However, the $50 in mileage isn't really "sales" and it is not taxable income. I mistakenly labeled it sales. I believe I need to change it to Reimbursed Expense (as described in this tutorial) so it does not show up as income in my Profit & Loss statement. Correct?
However, for invoices from the past, it appears I can't just change that $50 item from "sales" to "reimbursed expense." What do you recommend doing? Should I just recreate the invoice with the proper category designations and delete the old one?
Sometimes I'm paid by clients without creating an invoice if it's someone who I often do work for or they have their own invoice system. In this case I just go to the Transactions page and click Add Income. There I can split the transaction and make part of it "sales" and part of it "reimbursed expense" after the fact. But this doesn't seem to be the case with invoices.
Am I missing something? Recommendations?
Hi, I've completed steps to create a Chart of Accounts and assigned my expenses under Reimbursed Expense, and assigned it to my customer. Now I'm creating my invoice. Do I need to manually type in the expense or is there a way to pull it from my expenses? If you could please include screenshots with the step by step to create the invoice, that would be great. Thanks.
Hey @jstuk , you should be able to go into the invoice, remove the line item that has the wrong income account assigned and re-add it so that it has reimbursed expense assigned. You can actually head into your Products & Services page (under Sales) ahead of time and change the income account there so all you have to do in the invoice is remove and re-add the product.
IN the case that your invoice was paid through Wave Payments and not manually, the above workflow doesn't work but you can change the amount from income to reimbursed expense with a journal transaction.
One of these situations above should solve your issue but if I'm missing something, let me know.
Hey @franmorfini , if you have the expense already in your transactions page, then you can categorize it to Refund for Reimbursed Expense.