5.2 | Understanding the Service Agreement Item Type

Service Agreement Items

Like most items sold to customers, a Service Agreement must first be set up as an invoice item. As each service agreement invoice item is set up, an associated discount invoice item is created simultaneously.

Once the invoice item has been created the pertinent information will need to be filled in. The Service Agreement tab will provide basic information about the service agreement, Description, Price, Discount % or $ amount, number of planned visits, length (in months) of the service agreement, service description, and a discount description, if offered.

The Accounting tab allows you to choose the Income Account and COGS or Expense account that will be affected by the sale of the Service Agreement. For assistance with choosing these accounts please refer to your accounting professional, as these accounts will depend on your specific bookkeeping preferences.

Please note: The income account is used when a new Service Agreement is sold. The COGS/Expense Account is used when a Service Agreement Discount is applied to an Invoice or Sale.