Customer Discounts - How to do right?

I run a computer consulting business and many times we don't bill our client
for all hours we worked on a computer for them. We want to show that it
took 10 hours but charge for 5 hours. Here is my problem..

I am putting on the invoice all 10 hours then using another line item to
charge back the discount and show it as an expense. When I run a P/L report
it is offset with income and expense but I don't want it to show as income
only as an expense. But how do I show the client that they were billed for
10 hours and credited (Expense for us) for 5.

I want to write off this expense off my taxes..

Any help is appreciated.

"Mark Simons" <mark DeleteThis @dmtechgroup.com> wrote in message
news:n9kMd.6243$WD4.6129@twister.socal.rr.com...
 >
 > I run a computer consulting business and many times we don't bill our
 > client
 > for all hours we worked on a computer for them. We want to show that it
 > took 10 hours but charge for 5 hours. Here is my problem..
 >
 > I am putting on the invoice all 10 hours then using another line item to
 > charge back the discount and show it as an expense. When I run a P/L
 > report
 > it is offset with income and expense but I don't want it to show as income
 > only as an expense. But how do I show the client that they were billed
 > for
 > 10 hours and credited (Expense for us) for 5.
 >
 > I want to write off this expense off my taxes..
 >
I'm confused by your question.
When you bill 10 hours and charge for only 5 - there is income. It is
appropriate for both the income (10 hours labor) and the expense (5 hours
discount) to show in your profit and loss.

The method you are using is correct. The report you are recieving is
correct. An alternative method would be to have your discount item point to
a sub-account of your primary income account. For example, our company does
electrical work and our primary income account is 'Electrical Work'. I have
a sub-account named 'Discounts Given'. This puts the discount where *I* like
to see it on my P&L, the sum total of Electrical Work is the work that was
done minus the discounts that were given.<!-- ~MESSAGE_AFTER~ -->