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3 min 16 sec
0:00
Those stock photos
0:21
What a rebillable is
0:54
Why the profit is zero
1:15
Handling fees
1:43
Don't forget it
1:57
Rebilling in Beeswax
2:28
Recap and quiz
Accounting 101
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Costs and timing
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Episode 15
Rebillable Expenses
(Make sure the client pays. Not you.)
Maya bought stock photos for a client, who agreed to pay her back. How to rebill a cost so the profit on it is zero, when a handling fee is fair, and how not to forget.
rebillable expenses
markup
invoicing
Transcript
0:00
Remember those stock photos? Three hundred, bought for the Fern and Fold project. Maya paid for them. Fern and Fold agreed to pay her back.
0:09
It's a small thing. And it's exactly the sort of small thing that quietly eats a studio's profit, one forgotten receipt at a time.
0:21
A rebillable expense is a cost you pay on a client's behalf, and then charge back to them. Stock images. Printing. Couriers. Travel, if the client's agreed.
0:31
Step one happens when Maya buys the photos. Debit stock photography, an expense, three hundred. Credit bank. So far, she's three hundred poorer.
0:43
Step two, she puts it on the client's invoice. Debit trade debtors, three hundred. Credit reimbursed expenses, which is an income account. Now she's even.
0:54
Notice what's happened to the numbers. Revenue went up three hundred. Costs went up three hundred. Profit on the photos: zero. Which is exactly right. She was only ever passing them through.
1:08
If she forgets step two? She's just bought a client some very nice photos. Generous. Unwise.
1:15
Some studios add a handling fee on top. Ten or fifteen percent, for the time spent finding, buying and chasing. That's perfectly fair, as long as it's agreed up front, in writing. Surprise markups are how you lose clients.
1:31
And whether tax applies to a rebilled cost depends on where you are, and exactly how it's charged. The regional episodes cover that. It's more interesting than it sounds. Honestly.
1:43
The real risk isn't the accounting. It's forgetting. So build the habit. Before you send any invoice, look at the expenses on that project, and ask. Does the client owe me for any of these?
1:57
In Beeswax, record the expense against the project. That way it shows up in the project's profit and loss, so it can't hide.
2:05
When you invoice, add a line for it, coded to reimbursed expenses. That's one of the accounts Beeswax sets up for you on day one, for exactly this.
2:16
The project profit and loss then shows the cost and the recovery, side by side. Three hundred out. Three hundred back. And the receipt's already attached to the expense, if the client asks.
2:28
So. Pay it, record it as an expense. Rebill it, as income. Profit on it: zero, unless there's an agreed markup. And check every project's expenses, before every invoice.
2:42
Quick one. Maya spends four hundred on printing for a client, and rebills it with an agreed ten percent handling fee. How much goes on the invoice? And what's her profit on it?
2:53
Have a think.
2:57
Four hundred and forty on the invoice. Forty of profit. The fee, and nothing else.
3:03
Small numbers. But they add up. Just like the forgotten ones do.
3:08
Next time: contractors and employees. Two ways to get help, and why the difference matters more than you'd think.