Set up Receivables revenue recognition

Overview

For QuickBooks Online businesses, revenue recognition requires the Receivables add-on plan. See Get started with Receivables for access details. If you use another accounting provider, see Receivables availability by accounting provider.

Receivables revenue recognition lets you configure how revenue from billing schedules is recognized, then review the related revenue data and journal entries. It does not recognize revenue for individual invoices.

You need access to Receivables settings and an accounting provider connected for the billing schedule's entity. If you cannot access these settings, ask a user who administers Receivables for your business to complete the setup.

Enable revenue recognition and configure accounts

Open Revenue settings, then enable Revenue recognition.

  1. Select an Unbilled accounts receivable account. This account is required when you bill in arrears, meaning you recognize revenue before billing the customer.
  2. Select a Deferred revenue account. This account is used by default unless a product has its own deferred revenue account.

Enabling Revenue recognition applies only to billing schedules you create after you enable it. Disabling it stops future recognition and journal entries for unsynced activity.

Configure recognition on a billing schedule

Open Billing schedules to create a schedule. When you add a price, select its Revenue recognition method:

Service dates inherit from the schedule or its phase. Use the line item's additional options to override the recognition method or service dates when the contract requires a different period.

Important: A recurring point-in-time price must have a defined end date.

Review a billing schedule revenue projection

Before creating a schedule, select the Revenue recognition tab in the schedule review to preview each line item's billed, recognized, and deferred or unbilled balances by period. To update a scheduled schedule, open it from Billing schedules, then continue to the schedule review. For an active schedule, see Manage billing schedules by status. The projection also shows the billing and recognition periods, method, and billing timing.

If Ramp shows No revenue to recognize, select a revenue recognition method for an eligible line item. If it shows Revenue projection unavailable, select Invoice, then Revenue recognition to try loading the projection again.

After you activate a schedule, open it and select Revenue to review total contract value, billed to date, recognized to date, deferred balance, and the recognition-period breakdown. Select View all periods to filter and review individual periods.

Review revenue and journal entries

Open Revenue to review revenue across billing schedules. You can filter by customer, recognition period, or schedule, and review total contract value, billed to date, recognized to date, and deferred balance.

Select Preview journal entries to review journal entries for a close period before they sync to your accounting provider. Sync manually is available only to users with the required accounting permissions. If you do not have those permissions, ask a user who can sync bills and expenses to complete the sync. Use Sync history to review recent journal-entry sync activity.

Frequently asked questions

Can I recognize revenue for one invoice?

No. Configure revenue recognition on a billing schedule.

Why can't I see Revenue in Receivables?

The Revenue navigation item appears after Revenue recognition is enabled for your business. If it is enabled but you still cannot see it, ask a user who administers Receivables to check your access.