Further, QuickBooks is a much more powerful tool for your business if you use it to its fullest extent. Most likely you’ve been reconciling your bank account all along, so in this article we’ll discuss the tricks and techniques you need to know to streamline the process.

If you’re new to QuickBooks, you start the bank reconciliation process by having your bank statement in hand, and then choose Banking, and then Reconcile. The Reconciliation screen shown in Figure 1 appears. In most cases, you enter the ending balance from your bank statement, add any interest or fees, and then click Continue.

You mark transactions as cleared, as shown in Figure 2, and then click Reconcile Now. However, it’s not always that simple, so read on to learn how to sail over any hurdles that may appear.

The QuickBooks Begin Reconciliation window.

 The QuickBooks Reconcile window.

 Locate discrepancies
As shown in Figure 1, click the Locate Discrepancies button to display the Locate Discrepancies window shown inFigure 3.

From there, click the Discrepancy Report button to display the report, as shown in Figure 4. This identifies any edited or deleted transactions that may affect your reconciliation.

QuickBooks can help you identify edited transactions that may disrupt your reconciliation.

Confirm your beginning balance
Your beginning balance should always tie to your bank statement, but if it doesn’t, click the Undo Last Reconciliation button until you reach a point where the beginning balance matches your bank statement. You must then redo the reconciliations to bring your books current and resolve the discrepancy.

Don’t forget interest and fees
Be sure to record any interest and fees in the window shown in Figure 1. Alternatively you can record deposit and check transactions to record interest and fees, or the very savvy can use journal entries.

If you go this route, be sure to debit cash and credit interest income for interest earnings or credit cash and debit bank charges for any fees incurred.

Double-check your ending balance
Always double-check your ending balance input when you start the reconciliation. A simple transposition or other error here can make it appear that you’ve missed a transaction.

Look for transpositions
Sometimes you’ll mark all transactions as cleared, but still have a difference. In such cases, divide the difference by 9. If it divides out evenly, then there’s a good chance that you transposed a number on a transaction.

For instance, a $63 dollar difference divided by 9 returns 7 could mean that a transaction was entered incorrectly. You can right-click on an amount, and then choose Edit Transaction to fix the error.

Pick a side, any side

Don’t mix and match deposits and withdrawals. Reconcile your Deposits and Other Credits first, and then confirm that the total items you marked cleared ties to the amount shown on the Reconcile window.

Then reconcile Checks and Payments – doing one side a time limits your search area for missing or misposted transactions.

Clear the decks
If you get tangled up in a reconciliation, click the Unmark All button shown in Figure 2 to start over.

Enter missing transactions
You can add missing transactions without closing the reconciliation window. Simply choose a command from the menu across the top or from the Home screen. Saved transactions will instantly appear in the reconciliation window.

Check undeposited funds
Choose Banking, and then Make Deposits. If the window shown in  appears, you must complete the deposit process for these transactions.

Hide unnecessary transactions

Click the Hide Transactions after the Statement’s End Date check box shown in Figure 2 to have fewer transactions to sift through.

11. Void old transactions
Old, uncleared transactions can linger on forever – locate such transactions within your register, choose Edit, and then Void. The banking system generally considers checks to be stale after six months.

Such lingering transactions are often duplicates of a transaction that cleared.

Clear voided transactions
Always clear transactions with a zero balance as these won’t affect your reconciliation, but do clutter up the Reconcile window.

Bank online 
Some institutions allow you to synchronize your records with your online statement. This involves a matching process that automatically clears transactions that match, and makes it easy to quickly post new transactions.

Use your keyboard
Rather than using your mouse to click on each transaction that you wish to clear, use the arrow keys on your keyboard to move up and down. Press the spacebar to toggle a transaction as cleared or uncleared.

Walk away and come back later
If you just can’t seem to get the unreconciled difference down to zero, the best thing to do is click the Leave button shown in Figure 2, and then resume the reconciliation tomorrow. A fresh eye can do wonders.

Reconcile More Frequently
If you can access your bank account online, you can reconcile your bank statement as often as you wish. Consider reconciling accounts with heavy volume weekly or twice a month.

© 2012, Bruce Mc. All rights reserved.

The post Bank Reconciliation Tips and Tricks appeared first on QuickBooks.

Using the Report Center is a PC resource hog. Meaning it will such up your computers resources to open and use, I recommend that when you find/get your reports that you use regularly, memorize those, and open them this way. 

The Profit & Loss Summary Prev Year Comparison: To access this report, choose Reports, Company and Financial, and then Profit & Loss Summary Prev Year Comparison. Most business owners rely on the Profit & Loss Summary report, but comparing your results to last year can provide quick insight into whether your revenue is growing or contracting-as well as how fast expenses are rising.

The Balance Sheet Prev Year Comparison: You’ll find this report also within the Company and Financial section of the Reports menu. As with your income statement, it’s important to compare where certain balances stand now versus last year:

1. Cash
2. Accounts Receivable
3. Inventory
4. Accounts Payable
5. Other Liabilities, such as lines of credit or short term loans

The Statement of Cash Flows: As with the two preceding reports, you’ll find the Statement of Cash Flows in the Company & Financial section of the Reports menu. Profit & Loss reports enable you to see what you earned, while Balance Sheet reports help you determine what you have-as well as what you owe. However, neither report necessarily provides a clear picture of where cash is coming from, or going to. 

6. How much cash you’ve taken in from sales and spent on expenses
7. Cash inflows or outflows from borrowing, repayment, or investing activities

In short, this report shows you exactly what caused your bank balance to increase or decrease during a given report period.

The Collections Report: Rough economic times mean it is more important than ever to keep track of your collections. Fortunately QuickBooks makes it easy to contact customers with overdue invoices: choose Reports|Customers & Receivables, and then Collections Report. The report provides a phone list and shows all overdue invoices. However, you can also use this report to quickly e-mail copies of overdue invoices to your customers.

To do so, double-click on a transaction within the Collections report to view the invoice, and then click the Send button at the top of the invoice form to display the Send Invoice form. You can modify the wording shown to be more direct, such as a subject line of ‘Overdue Invoice‘ or perhaps e-mail text along the lines of-I’ve attached a copy of your overdue invoice. If there’s a problem with our products or services, please let me know immediately, otherwise I trust that you’ll remit payment promptly. To change the default e-mail text, choose Edit, Preferences, and then choose Send Forms. Select Invoice from the Change Default For list, make your changes, and then click OK.

A/P Aging Summary: Although it’s key to make sure that your customers are paying in a timely fashion, it’s just as important to pay your vendors, too. Unpaid bills can result in phone calls, e-mails, and other unnecessary interruptions. Choose Reports, Vendors & Payables, and then A/P Aging Summary to display the report. As with most reports in QuickBooks, you double-click on amounts to ultimately drill down to the original transaction.

 The A/P Aging Summary helps you determine when bills are slipping into overdue status.

The Trial Balance: Many business owners overlook the Trial Balance report, since it’s one of the few reports in QuickBooks that uses the terms Debit and Credit. However, it’s a helpful report, as it shows you all account balances in a concise format. If anything looks out of order, simply double-click on the amount to view the underlying detail. Choose Reports, Accountant & Taxes, and then Trial Balance to view this report.

Voided/Deleted Transactions Summary: It’s no surprise that small businesses are much more prone to fraud than large businesses. Small business employees usually wear multiple hats, so it’s often impossible to separate financial duties (bigger businesses can do this with ease). Fortunately QuickBooks makes it hard for perpetrators to cover their tracks: choose Reports, Accountant & Taxes, and then Voided/Deleted Transactions Summary.

You’ll be able quickly identify any transactions that have been deleted from QuickBooks. Granted, this isn’t an end-all solution by any means, but it is a helpful management tool. Plus, if a transaction ends up ‘vanishing’ from QuickBooks, you can use this report to see who deleted it!

The Voided/Deleted Transactions Summary enables you to find transactions that appear to have vanished.

The Audit Trail: The audit trail was an optional feature in earlier versions of QuickBooks, but is permanently enabled in recent versions of QuickBooks. This provides a complete record of every entry made in QuickBooks. The downside to that is that you can end up with a massive report. Don’t worry, as it’s easy to filter this report and narrow your search.

To do so, choose Reports, Accountant & Taxes, and then Audit Trail. Once the report appears, click the Modify button, and then click on the Filters tab. You can filter by date range, amount, or dozens more fields.

The audit trail shows every transaction-including modifications-in QuickBooks.

Previous Reconciliation: It’s a good practice to always print at least the summary report once you’ve reconciled a bank or credit card account. Someone else could edit a reconciled transaction, which could cause the reconciliation to be out of balance. A printed copy of the report shows that the account reconciled as of the report date, although you will still have to untangle the edited transaction. However, if you close out the reconciliation screen, you have a second chance to print your report: choose Reports, Banking, and then Previous Reconciliation. 

Transaction History: Think of this as a ‘report within a report’, as you can only run it in certain circumstances. You must have a transaction open on the screen or single-click on a transaction within a report. You can then choose Reports, and then Transaction History. QuickBooks will display a report that shows the entire history for a given transaction.

© 2012, Bruce Mc. All rights reserved.

The post Overlooked Reports you should use appeared first on QuickBooks.

There are actually three options for saving and relocating that file. You know about backups, since you should be producing them religiously. You generate them so that if QuickBooks — or your computer itself — stops working or your file becomes corrupt, you can re-create the entire environment. Portable company files are more limited, and are best used when you want to save your file to a temporary location and/or email it to someone else.

You would only use an Accountant’s Copy, of course, when you want us to check your progress. At L & R Tax Preparation, We’ll work with you on setting this up.

Once you save and send off an Accountant’s Copy, you can’t work on transactions created before the dividing date.

It is Critical that you Backup your file

I can’t emphasize this enough: Losing your financial data can be the beginning of the end of your company. You won’t know what you’re owed, so you’ll be unable to collect. You’ll miss vendor payments. Payroll will be impossible to reconstruct, and you won’t be able to submit payroll taxes. And how will you know what your income tax obligation is?

It can happen to you.

QuickBooks simplifies this process. Click File | Create Backup… You’ll be asked whether you want to back up locally — to a network folder or thumb drive, for example – or to the cloud, using Intuit Data Protect (fees apply). If you select the local preference, click on Options to designate a location in this window:

Choose from options in this window to create a backup profile.

Click OK, then Next. QuickBooks will ask when you want to save your backup copy and offer scheduling options. When you’re done, click Finish.

Warning: If you’re using Intuit Sync Manager, there are special rules about copying the company file. 

The Facts

Portable company files are more compact than backup files, so they can be easily e-mailed as attachments or copied onto another computer. But they don’t contain everything that backups do. They lack, for example, letters, logos, attachments, images and templates. Don’t use this option if changes will be made, since they can’t be merged back into the file.

Be sure to create a current backup before you begin to move your file.

To save a portable company file, click on File | Create Copy (you can do this to copy any kind of file, actually). 

Click File | Create Copy… to access any of QuickBooks’ three options.

Select Portable company file and click the Next button. In the following window, you’ll browse to a location for your file. QuickBooks will already have entered the name and will save your data in .qbm format. Click Save, then OK when QuickBooks tells you it must close and reopen your file first. Click OK again when you’re told that the file has been created.

Opening the file in another location

When you’re ready to open the file at another location, click File | Open or Restore Company… In the window that opens, select Restore a portable file. The Open Portable Company File window opens; make sure that the file’s location is displayed in the Look in: field. Click Open. QuickBooks then asks where you want to restore the file.

The following step is critical. Rename your file unless you want to overwrite your current company file. You can add a date or some other identifying information like a version number.

Click Save. QuickBooks will convert your portable file to a standard company file with a .qbw extension.

QuickBooks makes it easy to create copies of your data, but an error here can threaten your company’s future. 

© 2012, Bruce Mc. All rights reserved.

The post Backup or Portable? – You decide. appeared first on QuickBooks.

Excessive expenses cause debt, which in itself can be very costly. So any money-saving actions you take will be doubly rewarding.

 Effective Money Management

To cut expenses significantly, it’s necessary to poke into every corner of your company’s finances. Inventory is a good place to start. If you sell multiple units of the same item and reorder regularly, you should be using QuickBooks’ inventory-tracking tools. Go to Edit | Preferences | Items & Inventory | Company Preferences.

Make sure that these settings are correct.

If you need advanced features like FIFO costing, serial number and lot-tracking or inventory management at multiple locations, contact me about upgrading to Enterprise Solutions. 

You should be stocking your inventory to match the pace of sales. You don’t want to be caught short, nor do you want to be sitting on too much and tying up money unnecessarily. QuickBooks can help, but you’ll need to calculate the sweet spot for each item. Several built-in reports can help, including:

• Inventory Valuation Summary. Displays the current asset and retail value of each item and inventory as a whole
• Inventory Valuation Detail. Shows how individual transactions have affected the value of your inventory
• Inventory Stock Status By Item. Helps you set up smart reordering procedures
• Open Purchase Orders. Outlines each purchase order and its expected delivery date 

To maintain profitable inventory levels and minimize expenses, you’ll need to study QuickBooks’ related reports regularly. When you’re making buying decisions, consider factors like reorder turnaround time and seasonal sales upticks. 

Ratio reports, like profit over sales, can also be very telling. QuickBooks does not supply these, but we can help you create them in Excel.

 Use the Tools You have Available

The efforts you make toward reducing expenses in other ways can result in more savings than you might think. Here are some actions you can take that will accelerate your cash flow:

Use QuickBooks’ budgeting tools. This doesn’t need to be as onerous as you might expect – you can start by pulling in your real data from the previous year as a base. Build in line items for ongoing accounting support like QuickBooks maintenance. Click on Company | Planning & Budgeting | Set Up Budgets.

Selecting the option, Create budget from previous year will simplifie your task. 

Minimize your April 15 obligation with year-round tax planning. Work with us throughout the year on the next year’s taxes to, for example, make smarter quarterly payments, and we’ll help you reduce your tax bill by making better decisions every day.

Get discounts by paying invoices early. You can set up a custom field in vendor records to track this. Get to know which vendors offer early discounts — and take advantage of them. 

Analyze the cost-effectiveness of your transportation. Can you replace some in-person sales calls with web-based communication? Make sure that your delivery routes and sales call paths are efficient.

Change product/service prices to build in your own cost increases. Do it across the board, in small increments. It may not even be that noticeable to customers.

Talk to us about establishing a line of credit. We’ll help you determine if this is a viable option for emergencies. It’s cheaper than using credit cards.

Cross-train employees. Have employees train each other on their tasks where it makes sense. You can avoid costly temp help and relieve overworked departments.

Don’t try to change everything at once. Establishing these new procedures will require some extra work. And you may not notice a reduction in expenses immediately. But over time, you will see a positive change — one that will give you extra dollars and hours to invest in making your company flourish.

© 2012, Bruce Mc. All rights reserved.

The post Tips For Cutting Expenses appeared first on QuickBooks.

,  Done.

Billing for costs, time or mileage is a little more complex. QuickBooks has built-in tools to help you do this, but it’s a bit of a process.

To simplify your workflow, do this groundwork first:

• Go to Edit | Preferences | Time & Expenses | Company Preferences. Click the Yes button under Time tracking and indicate your choices under Invoicing options. If you plan to mark up some costs and want a default number, enter a percentage and account (these can be changed on individual invoices).

As you do with other QuickBooks processes, make sure that your Preferences are set correctly. 

• Add any billing items necessary by clicking Lists | Item List and then Item | New in the lower left corner.
• If you plan to bill for mileage, go to Lists | Customer & Vendor Profile List | Vehicle List and enter information about every business vehicle.

 Invoicing For Services

If you’re a service-oriented company, you bill for time frequently. This is easy. You’re probably already familiar with the Enter Time entry in the Employees menu. Whether you make individual time entries or complete a timesheet, it’s critical that you make the correct selections for each Customer: Job, Service Item and Payroll Item field, and check the Billable box.

When you create invoices, this box will open after you select a customer:

 QuickBooks lets you know when there are time and costs to be billed for each customer. 

You can let QuickBooks enter the time totals now, or add them later by clicking the Add Time/Costs button. Either way, the Choose Billable Time and Costs window opens. Add a checkmark next to each entry that should be billed, and click Options… to indicate whether you want one line for each time entry or would rather combine all similar service item types.

QuickBooks wants to know which entries should be invoiced. 

 A little More Complexity…

If you’re done with billable expenses for this invoice, click OK. If there are other costs that you covered, click theExpenses tab to see all transactions that you earmarked for this client on a bill, check or credit card. You have the option here to mark up the cost by a percentage or amount (even if you established this in Preferences), and to specify an account.

Do the same for Mileage, which you would have entered previously — when it was incurred — at Company | Enter Vehicle Mileage. Then select any Items that you purchased for the customer. Your records should be correct, assuming that you were conscientious about assigning expenses to customers and jobs.

 It’s easy to pull billable expenses into invoices if they’re documented carefully. 

Turning expenses into invoices and then into income can be complicated. Let us know if we can help. We are your partner in building a successful business..

© 2012, Bruce Mc. All rights reserved.

The post Time and Expenses Billing appeared first on QuickBooks.

If you’re having a problem reconciling your latest bank statement, the problem might be with outstanding bank account transactions.

If there was any lag time between the date of your statement and your start date in QuickBooks, make sure that you also entered any checks or deposits that happened in between.

For example,

 if your QuickBooks start date were 01/01/09, you’d use the ending balance on your December 2008 bank statement as your opening bank account balance. Let’s say the end date of that statement was December 20th, which means that all the deposits and payments you made from December 21st until December 31st are “outstanding,” or accounted for in your bank statement’s balance, but not in QuickBooks. To fix the problem in this example, you’d go back to your January 2009 bank statement, and enter into QuickBooks all the transactions that occurred between December 21st and 31st.

Pay bills in two steps.

For most users, paying bills in QuickBooks is a two-step process. (If you don’t track your accounts payable, it’ll be just one step.) First, when you receive a bill, enter it into the Enter Bills window (in the Vendor navigator and menu), so you can track how much money you owe. Second, when you’re ready to pay bills, indicate which one you want to pay using the Pay Bills window (also in the Vendor navigator and menu).

From the Pay Bills window, you can tell QuickBooks that you want to pay by check, and to put it into your print queue.

If you don’t track your accounts payable, you can reduce your steps to one, and simply use the Write Checks and Enter Credit Card Charges windows to pay your bills. Either way you choose to pay your  bills, just be consistent!

Don’t deposit your money twice.

Many users group their payments to deposit them all at once through the “Undeposited Funds” account. A mistake that some users make is that they also enter each payment as a single deposit. The result is two deposits for one payment.

When you use the Sales Receipt or Receive Payments forms to track money coming in to your business, you have the option to put payment into the “Undeposited Funds” account, which is like a cash drawer where you keep checks and currency in between trips to the bank. If you select this option on either form, QuickBooks won’t recognize the money into your bank account until you tell it that you’ve actually taken your money to the bank.

When you do go to the bank, tell QuickBooks by using the Make Deposits window, and select the payments you’ve just deposited. Do not enter a separate deposit into your bank account register to show this money.

Indicate when you owe sales tax.

If the amount of sales tax you owe appears to be incorrect, check to make sure you’ve set up your preferences correctly, telling QuickBooks when you owe sales tax. You may owe sales tax on an accrual basis, or when you make a sale, even if you haven’t received payment yet. Or, you may owe sales tax on a cash basis, or when you actually receive money from your customer.

To verify your sales tax is set up correctly, follow these steps:

• From the Edit menu, choose Preferences.
• On the left side of the window, click the Sales Tax icon.
• Select the Company Preferences tab.
• Under Owe Sales Tax, select either “As of invoice date,” or “Upon receipt of payment.”

I highly recommend you choose Upon receipt of payment even if you are reporting on an accurral basis.

Don’t enter a credit card charge and a bill for the same expense.

If you charge a purchase and enter it into QuickBooks through the Enter Credit Card Charge window, don’t enter it again as a bill (in the Enter Bills window). If you do, it’ll look like you owe twice as much money as you actually do.

Pay your payroll taxes with the Pay Liabilities window.

When you create paychecks for your employees, use the Pay Liabilities window to pay your payroll taxes. Don’t use the Write Checks window.

When you run payroll, QuickBooks keeps a tally of how much payroll tax you owe, and records it in your Payroll Liabilities account. When you use the Pay Liabilities window to pay your payroll taxes, QuickBooks will decrease the balance of the liability account accordingly.

( Hint )  In the Memo of your payroll liability checks list the through date and then the tax form. Be consistent and it will be much easier to find any problems should they occur.

“03/01/2010 – 03/31/2010   941″  or  “06/30/2010  940 FUTA 2nd Qtr”

Use Sub-Items and Sub-Accounts.

If an account or item has sub accounts or items, don’t assign your transactions to the parent item or account if you can help it. Always use the sub- items and accounts to increase your knowledge of your business. Sub-accounts and sub-items will show up on your QuickBooks reports as separate items, but will still be grouped together and sub-totaled.

For example,

when entering professional fees, assign the bill from your accountant to the Accounting sub-account of the Professional Fees main account, and the bill from your lawyer to the Legal Fees sub-account. When you pull reports -  and when you send your company file to your accountant at tax time  -  you’ll have a total amount you spent on Professional Fees, with sub-totals listed for both Accounting and Legal Fees.

Associate Inventory Items with the Right Accounts.

If you keep inventory, make sure that you assign your inventory items to all the right accounts. Each inventory type item should have three:

• Inventory Asset account,
• Cost of Goods Sold, and
• a Sales account

When you tell QuickBooks that you have inventory, it automatically sets up an Inventory Asset account (to track the current value of you inventory) and a Cost of Goods Sold account (to track how much you paid for your inventory items). You must set up sales income accounts to track the income you make from selling your inventory items.

Here’s how to check yours:

1. From the List menu, select Reports, and then Items. QuickBooks will display your Item list, detailing each one’s name, description, type, posting account, and price.
2. Verify that each inventory item is associated with all three accounts – Cost of Goods Sold, Inventory Asset, and an Income Account

Be Careful with Reconciliation Adjustments.

QuickBooks won’t usually make reconciliation adjustments automatically. However, if you’re out of balance in the Reconciliation screen and you select Reconcile Now, QuickBooks will make the adjustment, and post the positive or negative amount to the Opening Bal Equity account.

Don’t let QuickBooks do this! The right thing to do with small differences you find when reconciling is to enter a check or a deposit for the amount, using the bank statement date for the transaction date and put it to an appropriate account based upon your best guess of where the difference arose. You can then mark that transaction as cleared and proceed with reconciling.

Your Opening Balance Equity account is a clearing account, and should always display a $0 balance. If it doesn’t, your QuickBooks was not set up properly. You can check for these adjustments by looking at the account’s transaction detail:

• From the List menu, select Chart of Accounts.
• Double-click your Opening Balance Equity account.

If there are transactions in the account not related to your beginning balances, reclassify them!

Paying Loans

Entering a Bill for the Monthly payment instead of adding and asset and a liability

When creating loan payments we often enter the monthly loan amount as a Bill.

Here is how you should process loan payments: Set up a Fixed Asset with sub accounts for the Cost and Accumulated Depreciation. Then, set up a liability account with the loan balance. Go to Banking> Loan Manager>Set Up New Loan. Follow the directions, then click the ‘Set up payment’ option to have QuickBooks document the monthly payment.

Don’t Try to Do it All Yourself.

QuickBooks is easy to use, but it will be even easier and give you more peace of mind if you work with a QuickBooks Pro Advisor. Setting up your QuickBooks correctly is critical to getting the most out of your QuickBooks program. The HELP topics are also a great resource. Questions? 

Paying Loans

Entering a Bill for the Monthly payment instead of adding and asset and a liability

When creating loan payments we often enter the monthly loan amount as a Bill.

Here is how you should process loan payments:

• Set up a Fixed Asset with sub accounts for the Cost and Accumulated Depreciation.
• Then, set up a liability account with the loan balance.
• Go to Banking> Loan Manager>Set Up New Loan.
• Follow the directions, then click the ‘Set up payment’ option to have QuickBooks document the monthly payment.

Don’t Try to Do it All Yourself.

QuickBooks is easy to use, but it will be even easier and give you more peace of mind if you work with with a professional experieanced with QuickBooks. Setting up your QuickBooks correctly is critical to getting the most out of your QuickBooks program.

The HELP topics are also a great resource.

Have more Questions? 

Related articles

• Keeping Track Of What You Owe with Loan Manager 
• QuickBooks Inventory With Some Assembly Required 

© 2012, Bruce Mc. All rights reserved.

The post More Common Errors in QuickBooks appeared first on QuickBooks.

But first, you’ll need to make sure that this output will be accurate.

 Describe your Company

Your tax entity setting should have been established when you first set up QuickBooks, but verify that you’ve specified the correct one. Go to Company | Company Information. Your Report Information is in the lower left corner. Click the arrow next to Income Tax Form Used to see what’s active.

 Make sure that QuickBooks is set up for the correct tax entity. 

QuickBooks automatically assigns some of your accounts to their matching lines on Form 1040 and assorted forms and schedules; this is called tax line mapping. So when you create tax reports, related transactions will be grouped by these designations.

This can be a real time-saver — as long as you’ve specified the correct entity. If:

• was selected
• This setting is incorrect
• You’re starting a business and don’t know which to choose…

…please contact me. If you switch entities, your existing tax line mapping will disappear and will have to be reassigned.

 Dedicated Tax Reports

Many of QuickBooks’ general financial reports provide tax-related information. But there are some that specifically relate to the numbers that will go on your return. Go to Reports | Accounting & Taxes | Income Tax Preparation.

Here’s an excerpt of what you’ll see:

QuickBooks automatically assigns many accounts to the appropriate tax form lines, based on your specified tax entity. 

Here, QuickBooks shows you which tax lines have been pre-assigned to your accounts. You can specify a tax form line for unassigned accounts, but this is something you should not attempt on your own. This report, though, will give you an idea of how useful your report output will be and where you’ll need our assistance.

Other reports provide tax-related data. You can access them by going again to Reports | Accountant & Taxes and clicking:

• Income Tax Summary. This displays totals for each tax line that’s relevant to your particular tax entity. Double-click on any number, and the Tax Line By Account report appears, detailing every transaction related to every tax-related account (you could add a column for Tax Line in Display options and make this quite a useful report).
• Income Tax Detail. This lists all individual transactions by tax form/schedule line assignment.

Trimming it Down

 Some tax reports can be very lengthy; you may want to filter them to look at various “slices.” Click Customize Report | Filters:

The options listed under Choose Filter are available on other reports; they help you set up incredibly complex searches using multiple filters.

Let’s say you want a report that displays your installation labor costs on new residential construction from the last year (you could also throw other variables in). You’d simply choose the filters from the left pane and then select related options in the next pane (usually a list). You’d want to also click on the Display tab to make sure that the appropriate columns appear.

 You can apply multiple filters to your reports. 

QuickBooks reports can shave time off of tax preparation, and filtered views help you scrutinize your data in quite creative — and very useful — ways. The program’s boilerplate reports have their place in simple examinations of your financial status, but filters are potent tools. They can facilitate the kind of deep analysis that helps you make critical business decisions.

If you have questions on this or any other QuickBooks feature, call or email me. My company is your partner and we’re here to make your business better.

© 2012, Bruce Mc. All rights reserved.

The post Income Tax Reports – Tax line mapping. appeared first on QuickBooks.

Make extensive use of the tools that QuickBooks offers for report modification.

Comprehensive, meticulously-shaped reports that flow out of your carefully-constructed records and transactions are your reward for pounding on the keys every day, conscientiously recording income and expenses.

QuickBooks supplies you with a wide variety of pre-formatted reports whose modification options can help you do focused, critical analysis of your financial data. The right set of numbers will help you understand your history and plan for the future more effectively.

Note: The reports discussed and pictured here shows only one possible set of customization options. There are many variations. We can answer your questions.

Your Preferences first.

When you created your company file in QuickBooks, you chose between reporting on a cash (income and expenses are recorded when money changes hands) or accrual (recorded when you invoice or receive a bill) basis. This affects summary reports, but not those that break out individual transactions or are simply lists.

If you want to change this, click Edit | Preferences | Reports & Graphs | Company Preferences and click the desired button:

You can establish a preference for your summary reports’ basis. 

You can set other preferences in this window that will affect your report output here, too, as you can see.

 Change the Display

Open the Income by Customer Summary report (Reports | Company & Financial). Change the dates to reflect a range you’d like to see. Want the data displayed by different time increments — like week or quarter — instead of just the total? Click the arrow next to Columns and select Four week.

You can do some report display alterations from this toolbar; the options it offers vary by report. 

 

By default, your report rows display alphabetically. If you want to view a column by total in ascending or descending order, select the column by hovering over the top number until the magnifying glass appears, and click on it. Click the arrow next to Sort by and choose Total, then click the AZ [down arrow] icon (in some reports, there will be other options here).

Additional options in this toolbar let you:

• Memorize the report
• Print, email or export it to Excel
• Hide or Show the Header
• Collapse or Expand the columns
• Refresh the report if you’ve made changes that will alter data

More display options

Click Customize Report to open this window:

This window outlines your report’s content options. 

Some of the options here duplicate what you saw in the toolbar. In addition, you can switch between Accrual andCash for just this report, and add subcolumns in some. The latter is a complicated operation, one that you must understand well in order to glean any insight from it. We can help you with this.

Sometimes the subcolumns are generic, as shown in the screen above. In other reports, they’re very specific to that group of data.

 Clicking on Revert takes you back to the default format, and Advanced opens additional options specific to the current report.

 More customization = more insightful results = more informed financial choices

Transaction reports have many similarities and two major differences: You can change the column order by hovering your cursor over the column label until a hand appears. Click, hold and drag the column to the desired spot and let go. You can also add or delete columns by clicking Customize Report and checking or unchecking labels.

Learn the mechanics of report display modification well, and your company’s finances will come into much sharper focus, improving the wisdom of future choices. Up next month: filtering your reports for additional clarity.

If you have questions on this or any other QuickBooks feature, call or email us. We’re your partner and we’re here to make your business better.

© 2012, Bruce Mc. All rights reserved.

The post Modifying your reports for better insight appeared first on QuickBooks.

QuickBooks offers two simple conventions that let you identify related data: classes and types.

• Classes are used in transactions. 
• Types are assigned to individual customers, vendors, and jobs.

For example;

you might use classes to separate transactions that relate to different departments, locations, or types of business. A construction company might want to track classes using New Construction, Remodel, andOverhead. Your customer types might help you isolate groups by characteristics like Industry or Geographical Location.

Tip: 

If your class list grows lengthy and you want to tidy it up, you can make classes that you’re not currently using inactive by checking the box in this window. It will remain in your QuickBooks records and can be reactivated again.

Warning!

The Balance Sheet by Class report is complicated and may produce unexpected results. Let your ProAdvisor help you work with this one. They can also help you set up a solid class structure.

 

Related articles

• Get the Job Done and Track Costs too!
• Classes or Types? When To Use Them in QuickBooks
• Job-Tracking – Precision for your QuickBooks Company
• Review: QuickBooks 2012 makes great strides, but still falls short
• First Look: QuickBooks for Mac 2012

© 2012, Bruce Mc. All rights reserved.

The post When to use Classes or types in QuickBooks. appeared first on QuickBooks.

Next to payroll, paying bills is probably your least favorite task in QuickBooks. You don’t have to use this feature — you can keep stacking bills on your desk, scrawling the due dates on a paper calendar, and writing checks.

If you’re still operating this way, okay although, you’re missing out on the numerous tools that QuickBooks offers to track your accounts payable, including the ability to:

• Enter bills as they come in
• Set reminders for bills due
• Pay bills easily
• Locate a bill or payment quickly
• Enter bills as (or after) you receive items
• Link bills to purchase orders
• Have instant access to a bill’s status

 Bill Tracking

Note: Dealing with incoming inventory is complex. Consult with us if you plan to use this feature. 

Click Yes. The Open Purchase Orders box opens, containing a list of open POs. Select the one(s) you want and click OK. The bill form opens, containing the details of that purchase order. Change quantities if they don’t match the shipment, and edit other fields as necessary. Save the bill.

Settling your debts

It’s good to set reminders for bills. Go to Edit | Preferences and click Reminders. Make sure that theShow Reminders List…box is checked, then click Company Preferences. Find the Bills to Pay row and enter the advance notice you’d like. Indicate whether you want to see a list or a summary, then click OK.

When bills are due, click the Pay Bills icon or select Vendors | Pay Bills. A window opens displaying all outstanding bills. You can pare this down by selecting a date in the Due on or before field and filtering by vendors. The screen will look something like this:

Enter a check mark next to the bills you’re paying, and change the amount in the Amt. To Pay field at the end of the row if necessary. At the bottom of the screen, you can set the payment date and type, use any discounts or credits, and make sure the correct payment account is selected. When you’re done, click Pay Selected Bills.

Tip: You can have credits and discounts automatically applied by going to Edit | Preferences | Bills.

After You’ve Paid Up

There are a number of places where your bills appear in QuickBooks, including:

• The Unpaid Bills Detail report
• The A/P Aging Detail report
• The Vendor Center
• QuickReports
• In the Recent Transactions pane of some forms
• On the bills themselves

Figure 4: displaying the Paid status of bills.

QuickBooks also lets you void and delete bills, and copy and memorize them. Check with us before voiding and deleting, as this can make some complicated changes in your accounts.

You can just pay bills by using Banking | Write Checks or Enter Credit Card Charges. But the payoff for tracking bills is instant access to your accounts payable status, better relations with vendors, and a more insightful accounting of your company’s cash flow.

Related articles

• Intuit Announces QuickBooks 2012, Salesforce Add-on (pcworld.com)
• Job-Tracking – Precision for your QuickBooks Company (themotaxguy.com)
• Could Your Business Use Job Costing? (bjconquest.com)

© 2012, Bruce Mc. All rights reserved.

The post Bill Tracking in QuickBooks appeared first on QuickBooks.