Quickbooks Advanced Features - Wealth Builders CPA's (2023)

Ten Overlooked QuickBooks Reports That You Should Use

Just about every QuickBooks user relies on the Report Center and Reports menu, but if you’re like most, you have a small handful of reports that you tend to rely on. In this article we’ll go off the beaten path and explore ten reports that many users overlook. Even if you are using some of these reports, we’re sure you’ll find a few more to add to your repertoire.

1. 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.

2. 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

3. 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. As shown in Figure 1, you’ll be able to see:

  1. How much cash you’ve taken in from sales and spent on expenses
  2. 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.

Figure 1: The Statement of Cash Flows report explains changes in your bank account balance.

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4. Collections Report: Tricky 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. As shown in Figure 2, 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 shown in Figure 3. 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.

Figure 2: The Collections Report gives you a jump start on dunning overdue customers.

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Figure 3: You can adjust the wording of an overdue invoice e-mail for one customer at a time or change the default text.

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5. 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 shown in Figure 4. As with most reports in QuickBooks, you double-click on amounts to ultimately drill down to the original transaction.

Figure 4: The A/P Aging Summary helps you determine when bills are slipping into overdue status.

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6. 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.

7. 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. As shown in Figure 5, 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!

Figure 5: The Voided/Deleted Transactions Summary enables you to find transactions that appear to have vanished.

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8. 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, as shown in Figure 6. 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.

Figure 6: The audit trail shows every transaction-including modifications-in QuickBooks.

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9. 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. As shown in Figure 7, you can choose from multiple reports.

Figure 7: The Previous Reconciliation report option allows you to reprint missing account reconciliation reports.

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10. Transaction History: Think of this as a ‘report within a report’, as you can only run it in certain circumstances. As shown in Figure 6, 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. As shown in Figure 8, QuickBooks will display a report that shows the entire history for a given transaction.

Figure 8: The Transaction History report provides shows all activity related to a given transaction.

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Did You Know?

The Microsoft web site offers hundreds of free spreadsheet and word processing templates. Options range from timesheets to analysis tools to contract documents. Visit http://office.microsoft.com/templates, and then search for a template by use (home, office, school), collection (real estate, small business, wedding), or keyword. Indeed, if you’ve created a template that you rely on, you can submit it to the site and share your work with others!

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16 Bank Reconciliation Tips and Tricks

Although it may seem like drudgery, reconciling your bank account is a critical accounting task that you should carry out each month. Doing so helps ensure the integrity of your financial reports, since most of your accounting transactions ultimately affect cash in some fashion.

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.

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Figure 1: The QuickBooks Begin Reconciliation window.

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Figure 2: The QuickBooks Reconcile window.

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

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Figure 3: QuickBooks can help you identify edited transactions that may disrupt your reconciliation.

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Figure 4: Ideally your discrepancy report should never have any transactions listed.

2. 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.

3. 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.

4. 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.

5. 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. As shown in Figure 5, you can right-click on an amount, and then choose Edit Transaction to fix the error.

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Figure 5:Right-click on an amount and choose Edit Transaction to correct a mistake.

6. 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.

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

8. 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.

9. Check undeposited funds
Choose Banking, and then Make Deposits. If the window shown in Figure 6 appears, you must complete the deposit process for these transactions.

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Figure 6: Undeposited funds can pose problems with your reconciliation.

10. 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.

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

13. 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.

14. 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.

15. 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.

16. 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.

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Use Accounting Ratios to Stave Off Financial Problems

Does the mere mention of accounting ratios may put your teeth on edge, and bring back bad memories of Accounting 101? It shouldn’t as ratios can help your quickly determine how your business compares against others.

Banks often use ratios to analyze your financial statements as part of the loan approval process, so it’s helpful to know in advance how you’ll be measured. Even better, ratios allow you to compare your business against your peers since many trade groups publish lists of average ratios within an industry.

Although ratios may have made you drowsy during accounting class, they can be a fascinating way to measure your company’s financial performance.

Gross Profit Margin

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Simply put, gross profit margin-sometimes referred to as gross margin-is your revenues less your cost of sales. For some industries, this is a very meaningful metric, while it won’t mean as much to others. For instance, manufacturers, restaurants, and retailers often treat gross profit as a key performance indicator.

In such environments, one typically purchases inventory at one price, and ideally sells it to someone else at a higher price. The spread between these two numbers is the gross profit margin.

Let’s say that you buy $40 of pine straw (we’re trying to avoid the accounting class term widget) and sell it for $60. In this case, $20 of gross margin divided by $60 of sales yields a gross margin percentage of 33%. Thus one-third of your sales are available to put toward overhead items, such as office supplies, payroll, rent, taxes, and so on.

Ideally your gross margin is high enough to cover your overhead and leave you with a profit. With that example in mind, let’s see how you can calculate your own gross profit margin.
Caveat: Gross profit margin isn’t meaningful to everyone. For instance, if you’re a self-employed service provider, you may not have any cost of sales.

Your salary is arguably all or most of your profit. You can certainly count your salary as cost of sales and compute a gross profit margin, but you might not find much value in the result.

To begin, choose Reports, Company and Financial, and then Profit & Loss Standard. As shown inFigure 1, look for the Gross Profit amount, and then divide this by Total Income.

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Figure 1: The Profit and Loss Standard report provides the figures you need to calculate gross profit.

In this case, $30,953.20/$51,241.16 shows a gross profit margin of 60.4%. Is that good? Is it bad? Very often the answer is ‘it depends’, which is why you should try to compare yourself to similar companies in your industry.

However, let’s consider the restaurant industry. Many owners strive to keep their gross margin at around 63%, which means a cost of goods sold percentage of 37%. The gross profit ratio enables you to track this key measurement, but you must ensure that your transactions are being recorded in the proper accounts.

The percentages can skew if, let’s say a telephone bill, is miscoded to Food Costs, instead of Telephone. Similarly, your cost of goods sold might look great only because someone miscoded food costs into an overhead account, such as Supplies.

Profit Margin

Profit margin is another commonly used ratio that you can derive from the Profit & Loss Standard report by dividing Net Income by Total Income. In essence, this is the percentage of sales that the owner of a business gets to keep before Uncle Sam gets his share. Profit margins vary widely by industry.

For example, a grocery store chain may have profits of $2 billion, but a profit margin of just 2.6%. An oil company may have staggering profits in dollars, but their profit margin is often just 10%. Conversely, some software companies have a profit margin of 28% or more.

As with gross profit, the best way to determine whether a profit margin is reasonable is by comparing the result to one’s peers. The construction company shown in Figure 1 has Net Income for the period of $13,123.48, which when divided by Total Income of $51,241.16 returns a profit margin of 25.6%.

Inventory Turnover Ratio

This ratio illustrates how many times a year that you’re selling your entire inventory. This can help you gauge whether you may be holding too much inventory, or not enough. This ratio is based on cost of goods sold divided by average inventory.

As you’ve seen, cost of goods sold appears on the Profit and Loss Standard report look for Total COGS but you’ll have to perform a quick calculation to determine average inventory. To do so, divide the sum of your beginning inventory plus ending inventory by 2.

Although you can use several different reports in QuickBooks to determine the beginning and ending balance of your inventory, try this first: choose Reports, Company and Financial, and then Balance Sheet Prev Year Comparison.

Change the report date to This Fiscal Year, and then look for the inventory account balance, as shown in Figure 2.The ending balance for last year is also the beginning balance for this year.

If you need beginning and ending balances for a shorter period, such as a quarter, choose Reports, Accountant and Taxes, and then General Ledger. Set the report dates to the period of your choice, and then use the beginning and ending balances for your inventory account.

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Figure 2: The Balance Sheet Prev Year Comparison can provide beginning and ending inventory balances.

Average Collection Period

This ratio helps you determine how long it takes your customers to pay their invoices. The formula is a little more complex than some of the other ratios: number of days multiplied by average accounts receivable balance, divided by credit sales.

For instance, let’s say that your average accounts receivable balance is $30,000, and you had total sales of$400,000 for the year. 365 multiplied by 30,000 is 10,950,000. This amount divided by our total sales of $400,000 is 27.38, meaning that on average your customers pay their invoice in just under 30 days.

Be sure to monitor your average collection period, as your cash flow can tighten quickly if that ratio increases. If you typically invoice your customers, then you can use the Total Income figure from your Profit & Loss Standard report.

Keep in mind: Average collection period won’t be of interest if your customers pay on the spot, such as in a retail store or restaurant.

Although QuickBooks doesn’t directly provide a figure for average accounts receivable, you can quickly customize a report to aid in this calculation:

  • Choose Reports, Company and Financial, and then Balance Sheet Standard.
  • Click the Modify report button, and then set the From and To dates to match the period shown on your Profit & Loss report. As shown in Figure 3, change the Display Columns By to Months, and then click OK.

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Figure 3: Change Display Columns By to Months when you want a month-by-month report.

When QuickBooks displays the 12-month report, as shown in Figure 4, click the Export button, and then click OK to send the report to Microsoft Excel.

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Figure 4: You can convert the Balance Sheet Standard report into a twelve-month format.

As shown in Figure 5, row 9 contains the Accounts Receivable figures. In cell R9, enter this formula to calculate your average accounts receivable balance: =AVERAGE(F9:R9).

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Figure 5: Use the Accounts Receivable figures to calculate your average accounts receivable balance.

As you can see, the average collection period ratio enables you to determine how long it takes your customers to honor your invoices, which in turn has a direct impact on your cash flow.

Other Common Ratios

Current Ratio: Divide current assets by current liabilities to determine a firm’s liquidity.

Quick Ratio: Subtract inventory from current assets, and then divide by current liabilities to apply a more severe liquidity measurement.
Debt Ratio: Divide total debt by total assets to determine how much of the company is financed by debt.
Return On Assets: Banks often add net income plus interest expense together, and then divide this by total assets to determine the firm’s return on assets. This figure typically needs to exceed the interest rate of a loan that you may be contemplating.

Compare Yourself to Others

Now that you understand how to calculate ratios based on your financial results, the next step is to compare yourself to your peers. You may belong to a trade group that makes benchmarks available to its members. If not, a good first step is the BizStats web site, at www.bizstats.com.

Your line of business may be included in their free offerings, but even more information is available on a subscription basis. You can find even more resources by searching the Internet search for the term ‘industry benchmarks’.

Did You Know?

You can send your thoughts about QuickBooks to Intuit directly from within QuickBooks. To do so, choose Help, Send Feedback Online, and then one of these choices:

  • Product Suggestion, as shown in Figure 6
  • Bug Report
  • Help System Suggestion

Any of these links will display an online from in your web browser so that you can submit your thoughts directly to the QuickBooks development team. QuickBooks frequently updates its’ products, so before you send a bug report, choose Help, and then Update QuickBooks. Click the Update Now button to ensure that you have the latest patches and fixes for your version of QuickBooks.

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Figure 6: Submit your wish-list items directly to the development team from within QuickBooks.

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Profit & Loss Report Versus Statement of Cash Flows

If you’re like most QuickBooks users, you rely on the Profit & Loss Standard report to monitor how your business is doing. However, you may have overlooked an even more valuable report: the Statement of Cash Flows.

The Profit & Loss Standard (P&L) report is important in its own right, but it only provides partial insight into the health of your business. While the P&L shows what you earned and spent, the Statement of Cash Flows shows you where the cash came from and went to, also known as sources and uses.

As you’ll see in this article, you can use the Statement of Cash Flows to determine the how various activities increased or decreased your cash balance during a given report period.

Cash versus Accrual

Unlike some accounting packages, QuickBooks allows you to run most reports on either the cash or accrual basis.

Cash-basis means that transactions don’t appear on your Profit & Loss statement until either your customer pays their invoice or you pay a vendor (or employee). So, if you enter a bill in QuickBooks to be paid later, the expense won’t immediately appear on a cash-basis P&L.

Similarly, invoices that you send to customers won’t immediately appear on a cash-basis P&L. The expense appears when you write a check to the vendor, and the revenue appears when the customer honors their invoice. Accordingly, cash-basis reports don’t necessarily report a company’s true financial performance.

You could have a stellar looking Profit & Loss Report, but a list full of unpaid bills in QuickBooks. Accordingly, many accountants prefer that business owners use accrual-basis reports.

Accrual-basis reports recognize the effect of every transaction on your P&L immediately. Customer invoices appear on accrual-basis P&L reports as soon as you save the transaction, as do unpaid vendor bills. You can easily see the significance of these differences in Figures 1 and 2.

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Figure 1: Cash-basis reports only reflect paid transactions.

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Figure 2: Accrual-basis reports include all transactions – both paid and unpaid.

Accrual-basis reports provide a much better picture of where the business stands, but can make it harder to understand your current cash position. However, a cash-basis P&L isn’t a panacea for managing cash flow, as your business has many transactions that don’t affect the P&L.

For instance, loan payments, owner distributions, and owner contributions affect your balance sheet, which tracks assets, liabilities, and equity. Fortunately, the Statement of Cash Flows reflects these types of transactions and more, so it’s a great companion to both cash-basis and accrual-basis P&L reports.

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Set Your Preference

You can instruct QuickBooks to always display your reports on either cash or accrual basis:

  • Choose Edit, and then Preferences.
  • Choose Reports & Graphs, and then Company Preferences.

As shown in Figure 3, specify either Cash or Accrual, and then click OK.

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Figure 3: You can set either cash or accrual as your default report format.

Of course, at any time you can change a report to the other format. For instance, if your preference is set to accrual, but you may sometimes want to view a cash basis P&L:

  • Choose Reports, Company & Financial, and then Profit & Loss Standard.
  • Click the Modify Report button, and then choose Cash in the Report Basis section, as shown inFigure 4.

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Figure 4: You can change the accounting method for your P&L on the fly.

NOTE: Most, but not all, reports in QuickBooks allow you to change between cash and accrual. When a report is onscreen, choose Modify Report.

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If you don’t see the Report Basis section, shown in Figure 5, then you’ll know that you can’t toggle the report basis. Now that you understand the ins-and-outs of running cash and accrual basis reports, let’s explore the Statement of Cash Flows.

The Statement of Cash Flows

Let’s say that your cash balance at the beginning of your fiscal year was $100,000, and today it is $75,000. The net income figure on your P&L won’t give you the full details on why your cash balance decreased, but the Statement of Cash Flows will. To do so, choose Reports, Company & Financial, and then Statement of Cash Flows.

Report periods: As shown in Figure 5, this report automatically defaults to This Fiscal Year-To-Date, but you can choose another time period if you wish. To do so, make a choice from the Dates drop-down list, or modify the From and To dates, and then click the Refresh button.

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Figure 5: The Statement of Cash Flows defaults to the current fiscal year.

Your Statement of Cash Flows report will include up to three major sections:

  • Operating Activities
  • Investing Activities
  • Financing Activities

Don’t worry if your report only includes one or two of these sections – sections only appear when you had relevant transactions during the report period. Let’s explore each of these sections individually.

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Operating Activities

The Operating Activities section of the Statement of Cash Flows recaps activities related to running your business. This section will always start with Net Income, followed by an adjustments section.

The adjustments reconcile your net income with the net cash provided by the operating activities. For instance, refer to Figure 5. Net income s $112,999 but the Net Cash Provided by Operating Activities is $42,584. Accordingly, the statement of cash flows identifies the $70,415 difference. Let’s investigate a couple of the items:

Accounts Receivable (-$71,759): During the report period we sent invoices to our customers, of which $31,503.08 remain unpaid. These unpaid invoices are reflected in the Net Income figure, so QuickBooks deducts these because we haven’t received this cash yet.

Inventory Asset (-$17,354): Amounts that we spend on inventory don’t become part of Net Income until we’ve sold the items. At that point QuickBooks posts the expense to cost of good sold, and reduces our inventory account accordingly. Purchasing inventory is a use of cash, so it appears as a negative amount on our Statement of Cash Flows.

Remember: The purpose of the Statement of Cash Flows is to reconcile our net income with the actual change in our cash account. Thus non-cash activities, such as unpaid customer invoices or amortized prepaid expenses get subtracted or added from Net Income, so that you can get a clear picture of where cash went during the report period.

Employee Advances (-$62): We paid $62 to an employee as an advance, which has not yet been repaid. This amount isn’t included in Net Income, but is a use of cash, so the amount is deducted. When our employee repays the advance, our Statement of Cash Flows will reflect a positive amount, since at that point we’ll have a $100 source of cash.

Prepaid Insurance ($893): During the report period we amortized, or used up, $893 of prepaid insurance. This expense is included in our Net Income figure, but we didn’t write a check for it during this report period, so QuickBooks adds this expense back.

Accounts Payable ($13,537): We’ve entered bills into QuickBooks totaling $13,537 that we haven’t paid yet. In effect, we’re temporarily borrowing this money from our vendors, so it’s a source of cash. Later, our Statement of Cash Flows will show a use of cash when we pay the vendor bills. This same treatment applies to credit cards and other liabilities.

As you look through the Statement of Cash Flows, you may also see Investing and Financing activities. Investing activities may include owner contributions as a source of cash, or in the case of the report in Figure 5, the purchase of $11,500 in furniture as a use of cash.

Financing activities will show borrowing on a line of credit or other loan as a source of cash, while loan repayments (net of interest) will appear as uses of cash. In the end, you’ll see exactly what caused your cash balance to increase or decrease during the report period.

Research: You can easily investigate why amounts appear on your Statement of Cash Flows. As shown in Figure 6, the QuickZoom icon appears when you hover over an amount. Double-click to display a detailed report, as shown in Figure 7.

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Figure 6: The QuickZoom icon indicates that you can drill-down within a QuickBooks report.

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Figure 7: A detailed report appears when you double-click on an amount within a QuickBooks report.

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Organizing the Statement of Cash Flows

QuickBooks makes an educated guess at what accounts in your chart of accounts should appear on the Statement of Cash Flows. However, you may encounter instances where activities appear in the wrong section, or don’t appear at all on the report. You can easily remedy such situations:

  • Choose Edit, and then Preferences.
  • Choose Reports & Graphs, and then Company Preferences.
  • Click the Classify Cash button, shown in Figure 3.

As shown in Figure 8, place a checkbox in the appropriate column. You cannot remove balance sheet accounts from the statement, but you can optionally include income and expense accounts. However, keep in mind that this is not a typical need, and you should only proceed under the guidance of your accountant or tax advisor.

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Figure 8: QuickBooks allows you to classify accounts as operating, financing, or investing activities.

Did You Know?

QuickBooks has a Product Information window that can provide a dizzying array of information. Press Ctrl-1 to display the window shown in Figure 9. Some key elements on this screen include the product number shown at the top.

Each QuickBooks user in your office should have the same release number. The size and location of your QuickBooks file is shown in the File Information section, while you can use the List Information section to determine how many customers and vendors you have in QuickBooks.

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Figure 9: Press Ctrl-1 to view the Product Information window.

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QuickBooks Helps You Navigate Tricky Waters

The price of gasoline is just one of many factors putting pressure on our economy as a whole. Now it’s more important than ever to keep a close eye on your company’s performance. Many business owners compare financial results to an annual budget. If you don’t have your budget in place yet, we’ll show you how to get started. Even if you have, we’ll show you how to use last year’s results as a measuring stick with comparative financial reports. Once you understand these techniques, we’ll explain why you should create a monthly appointment with yourself to ensure that your results continue to measure up and take action if they don’t.

TIP: Keep in mind that tough financial years do have a silver lining-you’ll likely pay less in income taxes. If revenues are down or expenses are up, don’t forget to trim your withholding or estimated tax payments accordingly. Doing so enables you to boost your cash flow now, rather than waiting around on a tax refund next spring.

Budget Basics

The QuickBooks Planning & Budgeting menu gives you the ability to create budgets and forecasts. In reality, both features work the same way, so we’ll use creating a budget as our example. But which one should you use? You might find it helpful to use the Forecast feature as an alternate budget and as a best-case scenario, while the Budget feature offers a better expectation of reality. Either way, here’s how to create a budget in QuickBooks:

1. Choose Company, Planning & Budgeting, and then Set Up Budgets.

2. When the Set Up Budgets window appears, click the Create New Budget button in the upper right-hand corner.

3. Select the year that you’d like to create a budget for (such as 2010 or 2011), select Profit and Loss, and then click Next.

Balance sheet budgeting: QuickBooks offers the ability to create a budget for balance sheet accounts, such as planning for expected levels of cash, inventory, accounts receivable, liabilities, and so on. However, most small business owners find that just a Profit and Loss budget is sufficient for their needs.

4. Most users will choose No Additional Criteria on the next screen. However, QuickBooks does provide the option for a more granular budget that you break down to the customer, job, or class level. Click Next once you make a selection.

5. The next screen asks if you want to start with a blank budget from scratch or if you want to use last year’s actual data as a starting point. Most users will find it helpful to use the previous year as a starting point. Click Finish after you make a choice.

6. At this point you’re presented with a screen similar to Figure 1. You won’t see any numbers if you chose the From Scratch option in step 5.

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Figure 1: Starting with prior-year actual numbers can jumpstart your budget process.

7. Proceed with entering or updating your budget. Click the Save button as needed to preserve your work as you go, and then click the OK button when you’re finished.

Budget Tips: The Copy Across button enables you to copy the same amount across all twelve months. As shown in Figure 2, the Adjust Row Amounts button provides a quick way to adjust existing numbers up or down by either a percentage or dollar amount. You can edit your budget at any time: choose Company, Planning & Budgeting, and then Set Up Budgets. Choose your budget from the Budget list, and then make changes as needed.

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Figure 2: The Adjust Row button makes it easy to quickly increase or decrease budget figures by a dollar amount or percentage.

Budget Reports

QuickBooks offers four budget and two forecast reports. You’ll use these steps to run most of these reports:

1. Choose Reports, Budget & Forecasts, and then the report of your choice.

2. A three-screen wizard appears, asking you first which budget or forecast you wish to use. Once you’ve made a selection, click Next.

3. The next screen asks which report layout to use – you may only choose one, Account by Month – click Next after you confirm your choice.

4. Click Finish to display your report:

  • Budget Overview – As shown in Figure 3, this report provides a twelve-month view of your budget.
  • Budget vs. Actual – This 52 column report can be tricky to navigate, as the default format shows these columns for each month, as well as a 12-month total.

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Figure 3: Budget overview gives you a birds-eye view of your 12-month budget.

Report Taming Tips: There are a couple of ways to bring this report down to size. First, most users can eliminate the % of Budget column. To do so, click the Modify Report button, and then deselect % of Budget in the Add Subcolumns For section. Next, you can shrink the width of the columns. To do so, drag the diamond between the first actual and budget columns to the left, as shown in Figure 4. When you release the left mouse button, choose Yes when asked if you want to resize all of the columns. Alternatively, click the Export button to send the report to Excel.

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Figure 4: Narrow column widths can condense particularly wide reports.

  • Profit & Loss Budget Performance – This report compares your month and year-to-date actuals to the budgeted amounts, and also displays the 12-month budget. Although this report doesn’t display dollar or percentage variances, you can easily add these columns. Click the Modify Report button, and then select $ Difference and/or % Of Budget in the Add Subcolumns For section, as shown in Figure 5.

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Figure 5: It’s easy to add or remove columns on any QuickBooks report.

  • Budget vs. Actual Graph – This report doesn’t enable you to choose a budget – the current year budget is displayed automatically. As shown in Figure 4, this report enables you to get a graphic view of how your results measure up to your budget. You can choose between different budget views:
    • P&L By Accounts – This view compares your Profit & Loss accounts, also known as income and expense, to the corresponding budgets. The report automatically sorts variances by difference, and you can view up to six accounts at a time.
    • P&L By Accounts and Jobs – This view compares your P&L accounts on a job-by-job basis. Jobs with the largest total variance from budget will be presented first, and as with accounts, you can view six at a time.
    • P&L By Accounts and Classes – This view compares your P&L accounts on a class basis. As with the other views, you can view up to six classes at a time. This button appears even if you haven’t set the Enable Class Tracking preference.

Class Tracking: Classes allow you to you track costs by department, project, or other categories. To enable class tracking, choose Edit, Preferences, and then Accounting. On the Company tab, select Enable Class Tracking.

Graph Printing limitation: You cannot print more than one page of the budget graphs at a time, so you’ll have to click Next Group and then click Print to create a hard copy of each report group. QuickBooks doesn’t provide a way to print all of the graphs in one fell swoop. You also can’t modify the graph format, other than to choose a different date range.

Comparative Reports

Regardless of whether you use budgets in QuickBooks or not, it’s always helpful to compare this year’s results to last year. Doing so enables you to see trends in your data, such as how automobile expenses have increased. Such a report is just a couple clicks away:

1. Choose Reports, Company and Financial, and then Profit & Loss Prev Year Comparison.

2. By default you’ll see this year compared to last year. However, you can easily create a multi-year comparison:

a. Click the Modify Report button.

b. In the Columns section, choose Year from the Display Columns By drop-down list, and then click OK.

c. On the report screen, choose a date range, such as 1/1/04 through 12/31/08, and then click the Refresh button. As shown in Figure 6, a multi-year comparison will appear onscreen. If you find this format helpful, click the Memorize button to save this report for later use.

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(Video) QuickBooks Desktop 2023 Complete Tutorial

Figure 6: You can convert the Profit & Loss Prev Year Comparison into a multi-year report.


In this article we discussed how you can use the budget and forecast feature in QuickBooks to plan the future of your business. As each month rolls by, you can compare your plan to actual results. In addition, you can compare this year’s results to last year, or even the last several years.

Did you know?

Did you know that an accountant’s copy of a QuickBooks file can be converted to a normal QuickBooks company, i.e. a .QBW file? There are limited circumstances where you’d want to do so, because it’s not possible to merge two .QBW data files together. However, let’s say that you lose access to your QuickBooks company because your hard drive crashes or someone steals your laptop. These are situations where a converted accountant’s copy would be better than starting from scratch. If you need to do this, ask your accountant to carry out these steps in their version of QuickBooks:

1. Choose File, Utilities, and then Convert Accountant’s Copy to Company File (QBW).

2. Choose the Accountant’s Copy to convert.

3. Click OK on the prompt shown in Figure 7.

4. Assign a name to the new company file, and then click Save.

A final warning prompt will appear to confirm that this copy will overwrite any existing client copy of the books.

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Figure 7: Converting an accountant’s copy to a working QuickBooks company can serve as a disaster recovery method.

Of course, the best defense is to make frequent back-ups of your QuickBooks data on removable media, such as the USB flash drives that often cost less than $10. These easily allow you to carry your QuickBooks back-up offsite, such as in your purse or briefcase. But, it’s good to know that your accountant might be able to provide a working QuickBooks company – as long as you recently sent your accountant’s copy along to them.

Use QuickBooks Pro to manage your business and personal checking account.

QuickBooks Pro can be used to manage many different files. In your case, you could have a QuickBooks file called “Business”, and a completely separate QuickBooks file called “Home” to manage the separate checkbooks. For more information on the creation of a new company file, click on File in the menu bar, then New Company.

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How To Easily Track Your Inventory

Do you know where your physical inventory items are? Whether you keep them in a closet, in an unused office, or a warehouse, you need to keep a close watch on how many products you have, how many have been ordered, and when it’s time to reorder. Fortunately, QuickBooks has tools that help you track all of those numbers. If you’re conscientious about making use of them, you should have a good sense of the state of your inventory, wherever you store it.

Note: These tools are not available in Simple Start or QuickBooks Online.

Inventory 101

Let’s take a look at the life of an inventory item. First, you have to tell QuickBooks that you will be selling products. It asks for this information during the EasyStep interview, but if for some reason you didn’t set this up, you can still do it. Click Edit/Preferences, then Items & Inventory, and then Company Preferences. Make sure the first line is checked, as well as any others you want active, as seen in Figure 1.

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Figure 1: You can have QuickBooks track your inventory by selecting this option in the Preferences window.

Next, check your Chart of Accounts to see if you need to add any accounts to meet your inventory needs. This is easy. Go to Lists/Chart of Accounts, or click the icon on the home page. The Chart of Accounts is simply a list of the accounts your company uses, and the balance for each. QuickBooks sets a chart up for you based on the type of company you have, but as your business grows, you may need to add more. Figure 2 shows an example of the Chart of Accounts window.

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Figure 2: The Chart of Accounts window shows you the balance for each of your accounts.

To add a new account, click on the arrow next to Account and click New. Select the correct type of account, and answer the questions in the Add New Account window. If you have any questions here, consult QuickBooks’ help file.

See Your Inventory In High Definition

Next you’ll have to define your company’s products. Click Items & Services on the home page. The Item list opens. You can always come back here when you need to edit an item, but you may want to create one now. So click Item/New. You’ll see a screen similar to the one pictured in Figure 3, but its fields will be blank. Item records in QuickBooks contain a good amount of information about each item, which will be used in forms like invoices and documents like reports.

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Figure 3: An item record allows you to define your company’s product.

Fill out the information in each item record for each item you sell. You won’t be able to alter the numbers in the lower right corner; these come from other parts of the program. As for the other values, the need to make changes depends on the field. When you defined the item, you entered an On Hand amount. This of course will change as you sell, so you can change the reorder point. Conversely, the average cost (value of your inventory) is calculated by the program; it’s the total cost of items in stock divided by the number of items in stock. On P.O. and On S.O. simply indicate how much of your inventory is promised on purchase orders and sales orders.

Get Better Organized

QuickBooks lets you create assemblies, groups of items that are sold together as a kit. If you want to create one, click Lists/Item List, then click the arrow next to Item and click New. Click the arrow under Type, and select Inventory Assembly. Fill in the blanks on the window as you would for a single item, and select the individual inventory items in the box at the bottom. This box is pictured in Figure 4.

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Figure 4: An item assembly.

Once you’ve defined your items and assemblies, you can use them in two places primarily: transactions forms and records. Let’s say you’re creating an invoice. As you’re filling out the form, you’ll be able to click the arrow under ITEM and view a list of the items you’ve created. Click on one, and the details you’ve entered (like price) will appear. Click Reports/Inventory to customize and run the reports available.

Maintaining an adequate inventory-not keeping too much or too little on hand-is critical to your company’s financial balance. QuickBooks’ tracking tools can help you meet that ongoing goal.

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How to Take the Pain Out of Paying Your Bills

Settle Up Fast with Quickbooks’ Bill Paying Tools

Some of the financial crystal ball-types are telling us there are signs that the recession may be drawing some of its last breaths. But those bills are still coming in, and you may have had a long, dry summer and less income that you can use to meet those business obligations.

The desktop versions of QuickBooks can help. They can’t magically make more money appear in your coffers, but they can help you manage your bills so you’re always aware of what’s coming up and don’t get any nasty surprises. This keeps both you and your vendors happy, and minimizes the chance of affecting your credit report adversely. You can also maximize cash flow by being hyper-aware of when each bill is due and timing them appropriately.

(These bill-paying tools are available in all QuickBooks versions above Simple Start.)

Enter First, Then Pay

Of course, you can mimic your old manual method of bill paying by simply using QuickBooks’ check-writing convention. But if you do this, you risk paying the bill twice. If you follow the process shown in Figure 1 by entering and the then paying, you’ll ensure that you record the expense in the same period it occurred.

To start, click the Enter Bills or Vendors/Enter Bills icon. The Enter Bills dialog box opens as shown in Figure 2. If you received a bill, be sure that box in the upper right is checked, and that the Bill radio button is filled in.

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Figure 1: You’ll find these icons on QuickBooks’ graphical flow chart.

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Figure 2: The Enter Bills dialog box.

Next, click the arrow next to the Vendor line to select an existing vendor or add a new vendor. Change the date if necessary, and enter a reference number (this may avoid confusion later). Then, enter the amount due.

When you initially set up vendors, you either set up terms for each vendor or accepted the default. So the Terms field should already be filled in, and will generate the correct bill due date. Enter a descriptive memo in that field if you’d like.

Tip: Use the right-click menu when you’re entering bills to see more options.

Since this was an expense, you’ll want to record it as such. Make sure the Expenses tab is highlighted, and click in the Account field. Click the arrow that appears to drop down the list, and select the appropriate expense type. Fill in the rest of the field on the line, making sure to check the Billable box if this is something you can bill back to a customer. If the expense needs to be split into separate categories, create a new line and amount for each. Your bill now looks something likeFigure 3.

Click the Items tab and fill out the fields there if your expense involves products. You must have Inventory turned on to do this. Click Save & Close or Save & New. QuickBooks now works in the background, increasing Accounts Payable and dropping the bill into several reports.

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Figure 3: Make sure your completed bill entry screen is as complete as possible.

Paying Your Debts

When it’s time to pony up, click on the Pay Bills icon, or click Vendors/Pay Bills. You’ll see a screen similar to Figure 4. Check the radio button next to the correct preference to view all bills, or to limit the list to those on or before a specific date. Put a check mark next to the bill(s) you want to pay. The correct amount should fill in by default, but you can change this to make a partial payment.

If you want to view the bill, take a discount, or use credits, click on those buttons. Select a payment date, method (check or credit card), and toggle to the correct account if it’s not showing.

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Figure 4: The Pay Bills dialog box. Make sit easy to finish the job.

Once you’ve paid a bill, your Accounts Payable and checkbook balances decrease, and the vendor balance and reports are updated. QuickBooks stamps a PAID watermark on the bill to avoid confusion later on.

Tip: To find bills you’ve already paid, go to the Vendor Center.

So stop stacking your bills on an old spindle and ruffling through them every day to see what’s due. You’ll find that there are numerous benefits to using QuickBooks’ bill-paying features, such as an improved credit rating, a dearth of past-due notices, and better cash flow.

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4 Ways to Manage Prices in a Down Economy

We are living in a period of “accelerated change”. Indeed, the ground does seem to be shifting beneath us almost faster than we can comprehend, so it’s important to stay nimble in these difficult times.

One way you can do so is to closely manage your prices. In some cases you may need to ratchet your prices up to cover a commodity cost-spike. Or, you may want to offer special deals to your best customers to help retain their business.

In this article we’ll discuss four methods you can use to manage prices (and change) within QuickBooks.

Create Discount Calculations

Studies have shown that it’s far easier to get additional sales out of existing customers rather than from new customers. Targeted discounts are just one way to try to encourage your customers to buy more.

However, if you do offer a discount, don’t just type over your standard prices on the QuickBooks invoice, create a discount calculation instead. This accomplishes two things:

  • Your customers see on their invoice exactly how much of a break you’ve given them.
  • You can track how successful your campaign was.

It’s easy to set up a discount calculation:

  • Choose Lists, and then Item List.
  • Click the Item button, and then choose New from the menu (or press Ctrl+N).
  • As shown in Figure 1, Choose Discount from the Type list.
  • Assign an item name, complete the description field, and then enter an amount or a percentage.
  • Choose an account from the list-you may wish to create a separate account so that you can easily track the amount of discounts that you’ve offered.
  • Choose Tax or Non-tax to indicate whether the discount is applied before or after sales tax, and then click OK.

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Figure 1: A discount item allows you to create and track percentage or amount based discounts.

Keep in mind that discounts only apply to the previous row of the invoice or sales receipt. To apply the discount to multiple items, you must create a Subtotal item:

  • Choose Lists, and then Item List.
  • Click the Item button, and then choose New from the menu (or press Ctrl+N).
  • Choose Subtotal from the Type list, and then assign an Item Name and Description, as shown in Figure 2.

Figure 3 shows a multi-line invoice, along with a subtotal and a discount on all of the items.

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(Video) QuickBooks Online Q3 Updates & New Features

Figure 2: A subtotal item allows you to apply a discount to multiple items on an invoice or discount.

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Figure 3: Include a subtotal on your invoice when you wish to discount multiple items.

Use Price Levels

Price negotiations are becoming more prevalent and you may find that you have to offer a standard discount to one or more customers in order to keep their business.

In such cases, you might find the price level feature helpful, so that you don’t have to remember to include a discount item on each invoice:

  • Choose Lists, and then Price Level List.
  • Click the Price Level button, and then choose New (or press Ctrl-N).
  • As shown in Figure 4, assign a name to the price level, such as 10% Discount.
  • QuickBooks Pro users can only establish Fixed % price levels, which are applied globally to all products. QuickBooks Premier and Enterprise users also have the option to create Per Item discounts, where you can selectively discount only certain items.
  • Specify whether to increase or decrease item prices, and optionally choose a rounding method.

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Figure 4: Price levels allow you to apply automatic discounts to everything a customer purchases.

Note: You can use price levels to increase or decrease prices.

Change Item Prices

Competitive or other pressures may mean that you need to globally change all of your prices at once. Fortunately, you can use the Change Item Prices feature to do so:

  • Choose Customers, and then Change Item Prices.
  • As shown in Figure 5, select an Item Type from the list, and then select the items you wish to change, or click the Mark All checkbox.
  • Indicate a percentage or dollar amount to increase prices by. This can be based on the current price or current cost of the item. Enter a positive number to increase the price, or negative number to decrease the price.
  • Click the Adjust button to see the impact of your changes in the New Price column, and then click OK to make the changes permanent.

Timesaver: You can also manually fill-in the New Price column if you prefer to make targeted adjustments to selected items. This is easier than manually opening each item one at a time.

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Figure 5: The Change Item Prices feature allows you to adjust multiple prices at once.

Add a Surcharge

We’re fortunate that gas prices are currently far less than were they were just a few months ago. However, who knows how far they may go this summer during peak driving season.

At some point you may need to consider adding a fuel or other type of surcharge to help recover costs beyond what you’ve factored into your existing prices:

  • Choose Lists, and then Item List.
  • Click the Item button, and then choose New from the menu.
  • As shown in Figure 6, choose Other Charge from the Type list.
  • Assign an item name, complete the description field, and then enter an amount or a percentage.
  • Choose an account from the list, and then click OK. As shown, you may wish to create a separate account so that you can easily track the amount you earn from the surcharge.

Important: As with discounts, Other Charge items only apply to the preceding row on an invoice or sales receipt. Be sure to add a Subtotal item to your invoice if you want the surcharge to apply to multiple rows of your invoice or sales receipt.

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Figure 6: The Other Charge feature allows you to compute fuel and other surcharges.

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QuickBooks 2012: New Paths to Better, Faster Financial Management

As it usually does this time of year, Intuit has introduced new versions of its Pro and Premier products. QuickBooks 2012 promises to help you get better organized, save steps, and acquire more in-depth financial insights.

The new Express Start is designed for businesses that want to blast through setup and start entering customers and invoices. You have two other options though.

Advanced Setup is the old EasyStep interview that solicits more details. You can also open an existing file or convert data from Quicken or other accounting software.

Express Start requires minimal input. Company name, industry, company type, tax ID, and contact information is all that’s required. After you save your company file, it lets you start adding or importing customers/vendors/employees, products/services, and bank accounts.

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Figure 1: Express Start simplifies company setup

An Activity-Driven Calendar

QuickBooks’ Reminders keep you apprised of each day’s tasks, but they don’t provide any information about the past or future. QuickBooks 2012 solves this problem with its new Calendar. When you enter an appointment, to-do, or key business task (invoices, bills, purchase orders, etc.), it appears in the calendar. You can display a graphical view of the month that tallies activities for each day and lists them below. Daily and weekly views are in list form and links open the original documents.

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Figure 2: The new Calendar displays daily, weekly, and monthly views of your financial transactions

Save Excel Formatting

Once you’ve formatted a QuickBooks report in Excel, it’s frustrating to have to reformat it each time you run it for different time periods and/or with your ever-changing content. Excel Integration Refresh simplifies this process. You can now export a report to Excel, make formatting changes and save them, and then reapply them later to the same type of report using different date ranges and your updated QuickBooks data. Acceptable alterations include:

  • Row and column header font formatting
  • New formulas
  • Renamed column and row headers, and report titles
  • Resized columns
  • Inserted columns and rows
  • Inserted formula text

You can do this by opening your report in QuickBooks and clicking Update an existing worksheet, or by launching your report in Excel and clicking the QuickBooks tab on the toolbar, then the Update Report button.

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Figure 3: This window opens when you click Update Report in Excel

A New Report Community

There’s always room for more report formats. QuickBooks 2012 offers a library of Contributed Reports, variations created either by Intuit or your fellow users. You can select one of these, like Customer Sales By Quantity By Item Detail and instantly populate it with your own data.

You can sort these templates by industry and rating, and view them as a list, in a grid, or in the Report Center’s Carousel view.

Centralized Operations

QuickBooks 2012 also saves you time with its new Centers. The Inventory Center works similarly to those available for customers, vendors, and employees. It’s a clearinghouse of item records and transactions that can be viewed and sorted. You can also do inventory housekeeping tasks here, like adding items and launching transactions.

The Lead Center helps you carefully track new leads that you either paste in from Excel or enter manually. You can add to-dos and notes to contact records, and convert them into customers.

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Upgrading Can Be Tricky

Intuit has included other, smaller time-saving organizational and reporting tools in QuickBooks 2012, like One-Click Transactions, which lets you create related transactions from existing ones (i.e., invoice to credit memo) with one click.

There’s nothing especially difficult about using most of QuickBooks 2012’s new features. But upgrading and setup are sometimes quirky, and the Excel Integration Refresh tool has a learning curve. We’re happy to help you start your company file on the right foot or get acclimated to this latest version.

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Figure 4: Track your leads and convert them into customers in the new Lead Center

Billing for Time and Expenses: How It Works

Billing for inventory parts is easy. Pick the items from a list and specify a quantity. Poof. 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 Yesbutton 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).

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Figure 1: 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 Listand 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 eachCustomer: 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:

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Figure 2: 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.

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Figure 3: QuickBooks wants to know which entries should be invoiced.

More Complexity

If you’re done with billable expenses for this invoice, click OK. If there are other costs that you covered, click the Expenses 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 — atCompany | 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.

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Figure 4: 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.

QuickBooks Tip:

Here’s a cool little keyboard shortcut. Hit F2 while you’re in QuickBooks, and you’ll get the Product Information screen. It’ll tell you everything you want to know about your specific copy of QuickBooks, like your release and license number, the file size, number of users logged in, audit trail status and the total number of accounts, customers, employees, etc.

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QuickBooks News Update

Please note that as of May 31, 2012, Intuit is discontinuing support for QuickBooks Pro, Premier and Simple Start 2009, QuickBooks for Mac 2009 and QuickBooks Enterprise Solutions 9. You can continue to use these solutions, of course, but live technical support and add-on services like payroll, credit card processing, online banking and bill-pay will not be accessible. Talk to us about upgrading if you’re using any of these products or services.

Do You Need to Use QuickBooks’ Fixed Asset Tools?

Much of the work you do in QuickBooks is short-term. You send an invoice and it gets paid. Your purchase order is fulfilled, and the products move into your inventory. You run payrolls and submit their related taxes and other payments.

Managing the life cycle of your fixed assets is an exception. Fixed assets are physical entities that you purchase to help your business generate revenue, like property, a vehicle or a commercial oven. By definition, they must be in use for over 12 months.

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Figure 1: You’ll need our help in depreciating the book value of your fixed assets, but careful recording of them will make your QuickBooks reports, your taxes and your company’s worth more accurate.

QuickBooks can help you track these, but both the value of your company and your tax obligations–and the sale price, should you eventually sell them–are affected by how the book value of your fixed assets is depreciated. It’s important that you work closely with us over the life of each one. What you can do on your own, though, is to maintain absolutely accurate records in this area.

Two Paths

The best time to start recording information about a fixed asset is while you’re creating a transaction related to its purchase. You can build an item record for it as you’re filling out the Itemsection of Enter Bills, Write Checks, Enter Credit Card Charges or Purchase Order.

Let’s say you’re writing a check for a new company truck. You’d go to Banking | Write Checks and fill in the blanks. Click the Items tab below the MEMO field, and then click the down arrow in theITEM field. Scroll up to the top of the list if necessary and select . You’ll see this menu:

Quickbooks Advanced Features - Wealth Builders CPA's (60)
Figure 2: Keep track of your company’s fixed assets by creating item records for them. You can do this as you’re entering transactions for their purchase.

Click on Fixed Asset to open the New Item window.

Transactions Not Required

There may be times when you’ll want to create an item record for a fixed asset when you’re not processing a transaction. Such situations include:

  • Cash purchases
  • Transfer of a personal asset to your company
  • Purchase of a fixed asset with personal funds, or
  • A multi-item purchase.

To do this, click on the Lists menu and select Fixed Asset Item List. If you’re adding a new one, right-click anywhere in the list part of the screen and select New (or click the down arrow next to the Item button in the lower left of the screen and click New). The same New Itemwindow that you opened from the check-writing screen appears.

You’ve already chosen Fixed Asset as the TYPE, so your cursor should be in the Asset Name/Number field. Enter an easy-to-recognize name so that you’ll be able to quickly identify it in reports. Select the correct Asset Account (ask us if you’re not sure) and type a description in the Purchase Description field, clicking the correct button for new or used.

Enter the Date purchased, the Cost and the Vendor/Payee. Don’t worry about the SALES INFORMATION fields until–and if–you eventually sell the asset.

Quickbooks Advanced Features - Wealth Builders CPA's (61)
Figure 3: You should be able to complete the New Item window in QuickBooks for your fixed assets on your own, but consult with us on any questions.

Under ASSET INFORMATION, enter the Asset Description (you can write a lengthier description here), its Location, PO Number if applicable, Serial Number and warranty expiration date. AddNotes if you ‘d like, and you’re done–unless you want to incorporate Custom Fields. If so, click the Custom Fields button in the upper right, then Define Fields.

(We can provide the depreciation and book value numbers under FIXED ASSET MANAGER.)

Your fixed asset records are critical elements of QuickBooks. You may be storing similar information elsewhere in your office records, but QuickBooks needs it, too, so you’ll have a comprehensive accounting of your company’s value.

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(Video) QuickBooks Online Advanced - Complete 40-Minute Guide


Which 4 key features are only included in QuickBooks Online Advanced? ›

QBO Advanced includes everything in QBO Plus, including the ability to track by class, along with exclusive features such as reporting powered by Fathom, batch invoice import and custom user permissions.

What is the difference between QuickBooks Online and QuickBooks Advanced? ›

QuickBooks Online Advanced Features

QuickBooks Online Advanced has several features not available in QuickBooks Online Plus. QuickBooks Online Advanced comes with a smart reporting feature that uses Fathom to track financial records and other key performance indicators (KPI) with enhanced analytics and reporting tools.

What are the best features of QuickBooks? ›

Top 5 QuickBooks Desktop Features
  1. 'Past Due' Stamp (Pro/Premier/Enterprise) ...
  2. Cash/Accrual Toggle (Pro/Premier/Enterprise) ...
  3. Mobile Inventory Scanner (Enterprise) ...
  4. Improved Sales Order Fulfillment (Enterprise) ...
  5. Search the Chart of Accounts (Pro/Premier/Enterprise)
16 Nov 2022

What is difference between QuickBooks Advanced and Enterprise? ›

Whether QuickBooks Desktop Enterprise or QuickBooks Online Advanced is better for your business depends on your specific business requirements. The main differences between the two products include accessibility and the availability of advanced functionality and specialized features for different industries.

What are the 5 basic functions of QuickBooks? ›

The way we're going to organize this for you is by creating the skeleton of QuickBooks. The skeleton is made up of Vendors, Customers, Employees, Company, & Banking.
The 5 Basic Functions of QuickBooks
  • Vendors. The first function you see in the top left corner is Vendors. ...
  • Customers. ...
  • Employees. ...
  • Company. ...
  • Banking.
7 Jun 2013

What are the 4 item types in QuickBooks Online? ›

The item type determines if and how an item is tracked in QuickBooks. There are four basic item types: inventory, non-inventory, services, and bundles.

What are the 5 main Account types in the chart of accounts QuickBooks? ›

The main account types include asset, liability, income, and expense accounts.
Below are the most common types of revenue or income accounts:
  • Sales income.
  • Rental income.
  • Dividend income.
  • Contra income.
8 Nov 2021

What are 4 options you can access via accountant tools in QuickBooks Online? ›

Learn about accountant tools

Reclassify transactions: Edit or move multiple transactions at once. Write off invoices: Cancel and zero-out bad invoices that won't get paid. Undo reconciliations: Reset a reconciliation and start over fresh. Reporting tools: Set default date ranges and filters for financial reports.

How much is QuickBook advanced? ›

QuickBooks Online Advanced Pricing
QuickBook Online Advanced Free 30-Day Trial$90.00Per Month Free Trial

Is QuickBooks Online being phased out? ›

What does service discontinuation mean? Your access to QuickBooks Desktop Payroll Services, Live Support, Online Backup, Online Banking, and other services through QuickBooks Desktop 2020 software will be discontinued after May 31, 2023. This also means you won't receive critical security updates starting June 1, 2023.

How do I know if I have QuickBooks Advanced? ›

How do I know if I have quickbooks online Plus or Advanced?
  1. Go to the Gear icon on the top menu.
  2. Choose Account and Settings under Your Company.
  3. Select Billing & Subscription on the left pane. Then, you'll see the Online version you're using.
6 Jul 2020

What are the six versions of QuickBooks? ›

There are six QuickBooks versions that allow business owners to manage their accounting and finances: QuickBooks Online, QuickBooks Self-Employed, QuickBooks Pro, QuickBooks Premier, QuickBooks Enterprise, and QuickBooks for Mac. Each QuickBooks product varies in price, features, usability, and target audience.

What is the most important list in QuickBooks? ›

The Chart of Accounts is your most important list because every transaction recorded in QuickBooks affects an account from your chart of accounts. The Chart of Accounts are the foundation of your financial reporting. It is used to create important reports like the Profit & Loss and Balance Sheet report.

Which QuickBooks function is most useful? ›

Invoicing. Invoicing is one of the most crucial functions for many businesses, especially those that provide services or rely on freelancers. QuickBooks makes it easy to create invoices either from scratch or from an earlier estimate. You can even set up an invoice for recurring payments.

What are the benefits of QBO advanced? ›

QuickBooks Online
  • Share access with multiple users. Collaborate with your team and accountant. ...
  • Built-in business reports. ...
  • Share access with accountants. ...
  • Track income and expenses. ...
  • Create and send invoices. ...
  • Capture and organize receipts. ...
  • Maximize tax deductions. ...
  • Download transactions for your accounts.

How many users can QuickBooks Advanced have? ›

Billable users: Simple Start (1), Essentials (3), Plus (5), Advanced (25) Classes and locations: All plans (40) and Advanced (no limits)

What are the different access levels in QuickBooks? ›

Levels include full, partial, and none. Unrestricted access allows users to view all transactions in different reports, while searching transactions or any other activities. For example, a user without explicit permission to view Payroll information can view Payroll transactions if they have unrestricted access.

What are the 7 functions of accounting? ›

The 7 functions of accounting are Accounts Payable and receivables, Payroll, Inventory cost management, Cash collections & record keeping, Budgeting, Reporting financial statements, and Legal compliance & finance controls.

What is QuickBooks and its features? ›

QuickBooks is the most popular small business accounting software businesses use to manage income and expenses and keep track of their financial health. You can invoice customers, pay bills, generate reports, and prepare taxes.

What are the tools in QuickBooks? ›

What are the accountant tools in QuickBooks online?
  • Paycheck Calculator. If you want a fast way to pay your employees, this tool is for you. ...
  • Sales Tax Calculator. ...
  • Invoice Generator with free templates. ...
  • Employee Cost Calculator. ...
  • Equity and Investment Calculator.

What are the 3 main categories of usage limits in QuickBooks Online? ›

QuickBooks Online Essentials

Billable users: 3 users. Non-billable users: 2 accountant firm users. Unlimited time tracking only users.

What are the QuickBooks categories? ›

Learn about Schedule C categories and how to categorize transactions in QuickBooks.
You can categorize these types of transactions as taxes and licenses:
  • Business licenses.
  • Property tax.
  • Estimated taxes.
  • Federal tax.
  • Sales tax.
  • State tax.
  • Other taxes.
  • Doing business as (DBA) or Fictitious Business Name one-time filing fee.

What are the four main types of QuickBooks transactions? ›

Answer: The 4 main types of QuickBooks transactions are: 1. Banking and credit card transactions 2. Customers and sales transactions 3. Vendors and expenses transactions 4.

What are the six categories of accounts? ›

Types of accounts
  • Asset accounts are used to recognize assets. ...
  • Liability accounts are used to recognize liabilities. ...
  • Equity accounts are used to recognize ownership equity. ...
  • Revenue accounts are used to recognize revenue. ...
  • Expense accounts are used to recognize expenses. ...
  • Gain accounts are used to recognize gains.

Which 2 accounts Cannot be merged in QuickBooks Online? ›

QuickBooks uses some accounts as the default for certain features. These, like accounts connected to online banking, can't be merged or deleted. If you're merging accounts that have reconciliation reports, save those reports first.

What are the 3 levels of access in QuickBooks Online accountant? ›

When you assign the standard user role, QuickBooks lets you choose the user's access rights. You can choose to give them all access, limited access or none.

What are the five QuickBooks Online Tips? ›

Top 14 QuickBooks Online Tips (Including Keyboard Shortcuts)
  • Open Multiple Browser Windows.
  • Connect Bank & Credit Card Accounts.
  • Memorize Keyboard Shortcuts.
  • Set Up Items for Every Product/Service.
  • Use the Undeposited Funds Account.
  • Reconcile Your Bank Account.
  • Use Class & Location Tracking.
  • Use Attachments.
8 Aug 2022

Which 4 list types can be directly imported into QuickBooks Online? ›

You can import the following information to QuickBooks Online:
  • Bank Data.
  • Customers.
  • Vendors.
  • Chart of Accounts.
  • Products and Services.
  • Invoices.

How much does it cost to upgrade QuickBooks to 2022? ›

Thank you for posting, @DebP59725. QuickBooks Desktop (QBDT) Pro Plus 2022 annual subscription starts at $349.99/yr.

Do you have to pay a yearly fee for QuickBooks? ›

QuickBooks Desktop products are offered on an annual subscription basis. Unlike QuickBooks Online plans, which each come with a set number of users, QuickBooks Desktop plans come with one user license. Business owners must pay extra for each additional license, regardless of plan.

Does QuickBooks Advanced have payroll? ›

Individuals can enter their own details through the employee portal and mobile app (WorkZone). 1 When you are logged into QuickBooks Online select the Payroll tab and you'll be asked to choose your payroll plan. Select Advanced Payroll then Begin set up.

Why QuickBooks is shutting down? ›

Damaged or missing QuickBooks components, incomplete or improper installation, and damaged program files can cause QuickBooks 2022 shuts down randomly.

Do I have to buy a new version of QuickBooks every year? ›

You can purchase QuickBooks Premier Plus or have access to built-in payroll with QuickBooks Premier Plus + Payroll. Both plans are billed annually. Your annual subscription to either plan includes automated data recovery and backups, unlimited customer support, and automatic updates.

Is there a 2022 QuickBooks? ›

QuickBooks Desktop 2022 introduces several features to help automate and streamline your daily accounting tasks. Here's what features are included in the QuickBooks Desktop 2022 release and how you can use them to benefit your business.

What QuickBooks Advanced? ›

QuickBooks Online Advanced is a SaaS-based accounting software designed to scale with growing businesses. It includes the functionalities of QuickBooks Online, as well as more robust business analytics, customization, and resource management.

How do I upgrade QuickBooks Advanced? ›

Select Settings ⚙ and then Account and settings. Select the Billing & subscription tab. Make sure your payment info is up to date. In the QuickBooks Online section, select Upgrade your plan.

What does the little lightning bolt mean in QuickBooks? ›

Lightning Bolt = this transaction has been Verified by the Electronic connectivity or Banking Feeds download process. Asterisk = someone Started a reconciliation and check-marked this transaction in that tool, but then hit Leave and did not Finish the reconciliation.

How many item types are in QuickBooks? ›

There are four item types: inventory, non-inventory, services, and bundles. These help you categorize the products and services for better tracking. If you picked the wrong type, you can change it later on.

What is the difference between QuickBooks and QuickBooks Pro? ›

Quickbooks for Mac, as the name suggests, is a desktop tool for Mac users, Quickbooks Pro is a desktop accounting tool for small businesses, and Quickbooks Online is a subscription-based cloud accounting tool.

What are the features of QuickBooks Advanced? ›

QuickBooks Online Advanced
  • Features. Premium apps. Room to grow. Customization. Reporting & insights. Support & training. Expenses & transactions. Manage money & tax. ...
  • Industries. Overview. Professional services. Legal. Nonprofit. Accountants. Construction. ...
  • Move to Advanced. From QuickBooks Desktop. From a spreadsheet. From Sage 50.

What does the diamond mean in QuickBooks? ›

QuickBooks Enterprise Diamond is built for complex companies that need a robust end-to-end business management solution. It includes powerful tools for time tracking and payroll that help you confidently manage your business. You can connect Enterprise with Salesforce.

What is the best QuickBooks for a bookkeeper? ›

Takeaway: If you're a bookkeeper or accountant looking to provide accounting services to clients that use QuickBooks Pro or Premier, you need QuickBooks Accountant Desktop.

Do any large companies use QuickBooks? ›

180,000 companies rely on QuickBooks Enterprise*

"QuickBooks Enterprise, especially if you have inventory, is the best software. I think QuickBooks Enterprise could handle any size of business or businesses, and just give you anything that you need.

Do I need an accountant if I use QuickBooks? ›

Even if you manage your money using QuickBooks, it's worth having your tax return checked and approved by an accounting expert. If you have a more complicated business structure, such as a limited company, it's rarely advisable to do your own tax return, given the detailed knowledge required.

What is QuickBooks Advanced reporting? ›

What is QuickBooks Advanced Reporting? QuickBooks Advanced Reporting is a feature that lets you create customized reports. You can use your QuickBooks data to build your own report based on your specific needs. This lets you see how you're doing with your business.

Is QuickBooks desktop being phased out 2022? ›

Your access to QuickBooks Desktop Payroll Services, Live Support, Online Backup, Online Banking, and other services through QuickBooks Desktop 2020 software will be discontinued after May 31, 2023. This also means you won't receive critical security updates starting June 1, 2023.

What are the two types of QuickBooks? ›

QuickBooks offers different versions of its products with varying functionality and tiered pricing to cater to a wide range of user requirements and situations while not overwhelming small business owners and freelancers. Two key options are QuickBooks Online (QBO) and QuickBooks Self-Employed (QBSE).

How many users advanced QuickBooks? ›

QuickBooks Online Advanced is the most powerful QuickBooks Online plan designed to help growing businesses with increased capacity up to 25 users, top tier reporting and powerful customization.

What are the 3 levels of access in QuickBooks Online Accountant? ›

When you assign the standard user role, QuickBooks lets you choose the user's access rights. You can choose to give them all access, limited access or none.

How do I use advanced reporting in QuickBooks? ›

Sign in to QuickBooks as the admin. Go to the Company menu and select Users then Set Up Users and Roles. Select a current role then Edit or New (whichever is appropriate). Under Roll Access, Area and Activities, select File then QuickBooks Advanced Reporting, and select OK.

What are the functions of advanced reporting? ›

Advanced Reporting allows users to streamline their reporting process and easily customize pre-determined datasets based on industry patterns. Users can create easy-to-read data visuals and represent them in more relevant and meaningful ways by using Advanced Reporting tools.

What is the most used reporting tool? ›

Here are 10 reporting tools you can try:
  1. Whatagraph. Whatagraph is a reporting tool that's especially useful for tracking social media and marketing analytics. ...
  2. Power BI. Power BI is a data visualization tool. ...
  3. Reportei. ...
  4. Hive. ...
  5. Wrike. ...
  6. Octoboard. ...
  7. Tableau. ...
  8. ProWorkflow.


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