Purchasing services can be done efficiently using two main approaches. Choose the method that best fits your accounting needs and workflow. Please refer to Purchase workflow. This article describes the workflow starting from the Bill. You may have applicable documents that precede the Bill.

Both approaches result in the same accounting entries.

Option 1 – GL tab of the Bill #

1. Create a new Bill (how to create a Bill).
2. On the GL (General Ledger) tab select the appropriate expense account directly related to the service you purchased.
3. Save and post the Bill.

Accounting #

Recording an Item receipt creates the following transactions in the General Journal:

• Debits: Expense account selected on the GL tab
• Credits: Accounts Payable

Option 2 – Using a Service Item #

1. Navigate to the Items list and create a new item classified as a Service. In the item card, select the appropriate Expense account for this service.
2. Create a new Bill (how to create a Bill) and select the Service Item on the Items tab.
3. Save and post the bill.

Accounting #

Recording an Item receipt creates the following transactions in the General Journal:

• Debits: Expense account specified in the Item Card
• Credits: Accounts Payable