Originally Posted by jayeff

The correct way (and I did qualify as a chartered accountant many moons ago) would be to maintain your Paypal account as a bank so that your Quickbooks shows a complete record of your transactions there. Then, as you guessed, you issue invoices to all your sponsors, even though you don't actually send them out, because doing that lets you track who has paid and who not.

A decent set of accounts can be very useful for you to track your own progress, as well as being needed to make your accounts quick and easy to do, come tax time. From both points of view, every transaction needs to be recorded somewhere. Then at a glance, you will be able to see what you have earned, spent, what you have and owe, and what you are owed.