Set up and check a service item in QuickBooks Desktop

Before you start

A service item gives staff a consistent entry to select when billing for work. Before creating one, agree its description, charging unit, rate, income account and tax treatment. A name alone is not enough to decide where the sale belongs in the accounts.

This procedure covers a new sales-only Service item in QuickBooks Desktop for Windows, including Enterprise. It does not set up stock, subcontractor costs, payroll, opening balances or sales-tax rules. Use the approved settings for your company and region.

Prepare the item record

Check the company file before making changes. Arrange a current backup through your normal company backup procedure. Get permission to add items and agree who will review the result.

Open the Item List and include inactive entries in your search. Look for the same service under abbreviations and older names. If a suitable item already exists, have the reviewer decide whether to use it. Do not create another just to avoid resolving a naming difference.

Use this original worksheet to agree what the item should mean. The example is fictional and supplies no accounting or tax values.

If any required decision is missing, finish that decision before saving the item. In particular, do not select a bank account because that is where payment will eventually arrive. Have the accounting owner identify the appropriate income account.

Create the item

1. Choose Lists > Item List, then Item > New.
2. Select Service. Enter the agreed item name and sales description.
3. Enter the approved rate and select the approved income account. Check the tax code where shown. Leave subcontractor/purchase tracking outside this sales-only setup; if it is required, stop and scope that mapping separately.
4. Review the fields against your worksheet, then save the item.

These controls are documented in Intuit's item guide. Labels can vary by version. If the screen does not match the selected item type, stop rather than choosing a different type to get past it.

Verify the saved result

Return to the Item List and reopen the new record. Compare its saved name, description, rate, account and tax code with the approved worksheet. Check that it appears only once. Record the reviewer, date and any unresolved difference in your private setup notes.

The charging unit needs a separate check. For a per-visit service, a quantity of two should represent two visits. Calculate the expected line amount from the approved rate before staff use the item. This is a preparation check, not evidence that an invoice has been posted correctly. Do not put invented customer transactions in the live company file to test it.

For the first real invoice using the item, have the reviewer compare the selected item, quantity, rate and tax treatment with the actual job and approved price. A saved item is not proof that every later transaction uses the correct quantity or price.

Correct a mistake without losing the history

Intuit documents reopening an item to edit its fields and marking it inactive when it should no longer be selected. Inactivation preserves existing transactions. Changing item types is restricted and is not always reversible.

If the saved record differs from the worksheet, hold it from use and ask the reviewer to correct the specific field. If transactions already use it, review those transactions before changing account mappings or accepting any prompt that affects past entries. Do not merge or delete records as a shortcut.

The setup is complete when the saved item matches the approved worksheet and staff understand its charging unit. Keep unresolved items out of daily use. Customer setup, invoice entry, receiving payment and deposits remain separate tasks.

Related preparation

• Review your chart of accounts
• Prepare opening balances

Source reviewed 18 October 2026. This is an original setup procedure based on Intuit's US Desktop documentation; no native QuickBooks test or customer result is claimed.