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Accounting Terms
Subtotal
Definition
The sum of all line items before taxes, discounts, or other adjustments.
Overview
The subtotal shows the base cost of goods or services before additional calculations. It's the starting point for applying taxes and discounts.
Example
Line items total $1,000 (subtotal), plus $100 tax, equals $1,100 total.
Best Practices
Show subtotal clearly before taxes and discounts so clients understand the breakdown.
Common Mistakes to Avoid
Confusing subtotal with total
Math errors
Not showing subtotal separately
Frequently Asked Questions
Should I show subtotal on invoices?
Yes, it helps clients understand the base cost before taxes and adjustments.