I am planning to move my business to Quickbooks and move to accrual. When do I create an invoice?

Question

I run a DJ business. So a client may say they would like to book, and fill in a booking form up to 1 month or more in advance before their actual party.

When do I create the invoice (recognise the payment earned). When they decide to book, or after the party has been done?

If they are a corporate client and request an invoice, do I provide them with an invoice or an estimate?

I I create an invoice a month before the event, will it show up on my accrual accounting system as having been received? How does this work?

If I do not create an invoice prior to earning the income, can I set a future date on an invoice, for it to be recognised at that later date, and not the date of the invoice?

If someone could help that would be great!

Answer 1

I'd say that for both private and corporate clients that book in advance, you should provide them with an estimate. It's not until your work is done that you should invoice them. Once the event is done, it is easy to create an invoice based on the estimate form.

Once you create an invoice, the revenue is recognized on your books as of that date. But it's not until you get a payment from the client and record that payment against the invoice that your books will show payment received.