Creative calculations courtesy of QBO
He is a story of my experience with a new way QuickBooks Online started to do calculations with their Progress Invoicing system. It has upset my sensibilities and confidence in mathematics and software developers. I mean a simple subtraction should give a straightforward answer, right? Well, read on and get a sense of my latest weird encounter with QBO.
Sir, we do not appear to be in Kansas anymore!
This one has been a real head scratcher. QuickBooks Online – Intuit’s flagship small business accounting SaaS – has change the way simple arithmetic works. Let me paint the picture of this doozy.
First, we are using Progress Invoicing where we can assign a percentage of the total estimate to an invoice. This is for a goodwill deposit from the customer. Now everyone knows how simple percentage calculations are, but a new bug was discovered by yours truly late last week. (By the way, everything was working within reason until last Friday.)
Let’s go over the accounts involved in this scenario
- Sales of materials
- Sales of services (labor)
- Costs of Goods Sold
- Sales Tax Payable.
- Accounts Payable (supplier/vendor)
Let’s say that the estimate was accepted by the customer and required a goodwill deposit of 25%. Well, QBO has allowed us to create invoices that automatically calculate either a percentage of the total, the full amount, or custom amounts.
When the customer makes the pre-payment, I record it and send them a payment receipt. So far so good. Next comes the math from a different universe. You would think that it would be an easy calculation to deduct the payment from the remaining due. But in this new glitch you would be wrong.
So I went to create the final invoice using the progress billing feature, the calculations went wonky. Instead of deducting the amount of the prior payment, QBO spits back a number that is off, saying that the customer owes more than they actually do.
OK, so now comes some head scratching and calculator keying. Sure enough, the calculator gives a reasonable answer to a simple addition and subtraction problem but not QuickBooks Online. No, it does some behind the scenes magic and spits out a newly minted amount owed. One I’m certain the customer will question.
What the heck is going on?
I have my hypotheses as to where the algorithmic jokester has come from – well sort of! My best guess is that it has something to do with the calculations on the Sales Tax Payable account and the Cost of Goods Sold account combined with the percentage feature of Progress Invoices and percentage calculated goodwill Discounts.
The originating estimates have mixed items from the Products and Services list, both Non-Inventory and Services including Bundles. For the non-inventory items, as stated earlier, the affected accounts are the COGS and the Sales:Materials accounts. Does this calculation have a glitch? Maybe!
The other potential point of breakdown is the calculation of the State Sales Tax amounts from the Sales:Materials account. I will have to dig deeper into these accounts to see if the numbers are in line with our reality or the alternate universe theory. I have filed a case with Intuit’s QBO Support. In the meantime, Chart of Accounts here I come.
If you are experiencing similar oddities, please report it as soon as possible to QBO Support. I will have to get back to you as to what Intuit’s engineers’ report, if anything. I just hope they fix their mathematical engine soon.
Oh, and my workaround to be able to send a customer a correct invoice is to use the “Deposit” field near the bottom of the invoice. This is not ideal as I do not know if all of the accounts have proper amounts entered. I will have to get back to you on this one.