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How to Track Employee Time, Part 1

8/4/2020

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Whether you’re recording employee hours for payroll or customer billing, your entries must be accurate. QuickBooks can help.

 
It’s easy to track sales of goods in QuickBooks. You create an invoice or a sales receipt, select the product the customer wants along with the quantity, and save the transaction. QuickBooks reduces the corresponding inventory level and records the purchase in the correct account.
 
Accounting for services sold, however, is a bit more complicated. Whether you’re charging customers for consulting, labor, or any other task that gets billed by the hour, you have to both create records for that billable time and track the hours spent on it carefully. QuickBooks provides tools that simplify both chores.
 
You’ll use those same tools if you need to record the hours employees work for payroll purposes. QuickBooks allows you to track time in individual records and/or traditional timesheets. Here’s what you need to know.
 

Editing Preferences

 
Before you can start tracking time, you’ll need to make sure that QuickBooks is set up for that job. Open the Edit menu and select Preferences, then click on Time & Expenses.With the Company Preferences tab highlighted, click the button in front of Yes under Do you track time? if it’s not already filled in. Click the down arrow in the field next to First Day of Work Week to open the list and choose the correct day. If it’s appropriate, check the box in front of Mark all time entries as billable.Click OK.
 
 
 
QuickBooks needs some information from you before you can start tracking time.
 
While you’re still in the Preferences window, click on Sales & Customers, then My Preferences. When you create an invoice for a customer that has unbilled time, QuickBooks can open a window listing the billable services (Prompt for time/costs to add) or display a small box asking you whether you want to include those items (Ask what to do). Select your preference or Don’t add any, then click OK.
 

Individual Time Entries

 
Let’s look first at creating individual time entries. Click the arrow to the right of Enter Time on the home page (or Customers | Enter Time) and select Time/Enter Single Activity. In the window that opens, make sure the Date is set to the date the service was provided (if that is different from the current date that appears). Click the down arrow in the Name field and choose the correct employee, and in the next field, select the Customer:Job.
 
Warning: If this work was done for a specific job, be sure to click on the actual job, not the main customer entry.
 
 
The Time/Enter Single Activity window
 
Next, select the Service Item, the actual work that the employee did. Below that, you can either enter the Duration worked manually, or click Start to launch the automatic timer. If the work is Billable, be sure to check that box in the upper right. Add Notes if you’ d like.
 
The Payroll Item (pay type) and WC Code (workers’ compensation) fields will only appear if you have QuickBooks set up for payroll. If this is the case, and you don’t see those fields, minimize the Time/Enter Single Activity window by clicking in the small horizontal line in the upper right. Click Employees in the toolbar (or Employees | Employee Center) and double-click on the name of the employee. Click on the Payroll Info tab to the left. You’ll see a line toward the bottom that says Use time data to create paychecks. Check that box and click OK, then reopen the Time/Enter Single Activity window by clicking the double box icon in the lower left of the screen. The two fields should be there.
 
When you’ve completed all of the fields required, save the time entry.
 
Note: Are you still doing payroll manually? It’s much easier to track time and pay employees if you’re doing payroll through QuickBooks. But setup can be complex, and we would want to guide you through the process. Let us know if you’re interested.
 
Creating time entries isn’t difficult, but it can be time-consuming if you have a lot of employees being paid by the hour. So, next month, we’ll look at QuickBooks’ Timesheet feature. We’ll also show you how to get information about the time entries you’ve created and what to do if QuickBooks’ time-tracking isn’t robust enough to meet your needs. In the meantime, be sure to contact us if you need help with QuickBooks or your accounting in general.
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Communicate with Customers: QuickBooks and Microsoft Word

7/7/2020

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The pandemic has forced businesses to find new ways to connect with customers. QuickBooks has built-in tools that can help.

 
Businesses are starting to cautiously re-open in the U.S. (at least partially), but we’re still a long way from “normal.” Because of COVID-19, some companies have done very well. Most, though, have had to make changes to comply with health guidelines and keep their customers and employees as safe as possible. And many consumers and businesses are less willing to spend money until they know more about the country’s path to recovery.
 
If your business has had to shut down temporarily, or at least scale back operations, we hope you’ve found ways to stay in touch with your customers. Even if you’re struggling, it’s important to communicate with the people who have helped you build your company.
 
QuickBooks can support you in this effort. Its integration with Microsoft Word makes it possible to create and dispatch letters or emails to customers that can fit a variety of common situations. There are dozens of pre-written templates that you can personalize and send to one or 10 or hundreds of the consumers and companies with whom you’ve built a relationship. Here’s how it works.
 

Finding Your Message

 
To get started, open the Customers menu and select Customer Center. To explore what’s available, click the down arrow next to Word in the toolbar, then select Customize Letter Templates. This window will open:
 
 
Before you start preparing customer letters, you should see what’s available.
 
Click the button in front of View or Edit Existing Letter Templates, then click Next. You’ll see the letter templates that are available, divided into types. Spend some time clicking on each type to see what your options are.
 
Let’s say you want to send a letter to customers who haven’t been active for a while. Click the button in front of Customer and scroll down to Inactive customer. Select it and click Next. You’ll notice that Microsoft Word has opened and is displaying your letter template, which is now saved to your QuickBooks folder. If it’s in your taskbar tray, click to open it. Read through it and make any changes you want, then save to the current folder and close it. Click Use Template.
 
In the window that opens, you’ll select the recipients of your letter. Under Include names that are, you’ll click the button in front of Inactive.  You want to direct your correspondence to customers, not jobs, so click the button in front of Customer. Look at the list that QuickBooks has displayed and make sure all of the entries have a checkmark in front of them. If you want to remove any of them, click the checkmark to turn it off. Click Next.
 
 
You can select the customers who are to receive your correspondence on this screen.
 

Editing Your Letter

 
In the window that just opened, Inactive customer should be highlighted. Click Next. Enter the Name and Title that should appear in your letter’s signature. When you click Next again, a single Microsoft Word document will open containing all of your letters in one continuous document (each letter will start on a new page). You’ll be able to edit these letters without affecting the original template.
 
If you want to print envelopes, you’ll click Next. If you want to continue on to edit and send your letters, click Cancel. Your personalized letters should be in your Windows taskbar tray. Open the document and scan through it to see if you want to change anything.
 
 You can edit your customer letters individually.
 
In the example above, you might want to, for example, delete the customer’s first name so it just reads Dear Mr. Burch. Or, you might want to change the words “Have we disturbed” to something like “worried” in the second paragraph.
 
If you want to save these letters as edited, you can go ahead and do so. Otherwise, just print them as you would any Word document. Of course, you could copy and paste them into your email system and send them that way. But sending a signed, printed letter during these times provides a more personal touch.
 
You may have already developed the habit of communicating with your customers outside of exchanging sales forms and payments. If not, consider finding ways to interact occasionally with those individuals and companies that keep your business going. This is especially important right now, as we all wait to see how the recovery will continue to progress. Let us know if we can help in any way during this uncertain period.
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Make QuickBooks Yours: Customize the Desktop

6/9/2020

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Make QuickBooks work faster for you by changing a few settings.

 
Whether your business has been locked down because of the pandemic, or you’re scrambling to hold things together with fewer employees or diminishing sales, you’re probably leaning on QuickBooks more than ever. You may be watching dwindling inventory items closely or monitoring your daily cash flow or trying to collect on invoices that aren’t being paid because your customers are short on money.
 
QuickBooks can help with all these accounting tasks. But you certainly don’t want to waste time now just dealing with the software’s mechanics.
 
As always, we’re available to help as you deal with the toll that COVID-19 is taking on your company. We’d also like to suggest that you spend a little time customizing QuickBooks. Streamlining its operations will take some of the unnecessary frustration out of your work life.
 

Getting Around Quickly

 
QuickBooks tries to accommodate different work styles and preferences by providing multiple navigation methods. These are:
  • The old, standard Windows menus.
  • The home page’s icons.
  • The Icon Bar that appears in the left vertical pane by default (you change its position by opening the View menu).
 
If you’re going to use the Icon Bar, we recommend that you set it up to make your most often-used tools prominent. Right-click in the toolbar and click on Customize Shortcuts to open the Customize Icon Bar window. In the upper left corner, you’ll see a list of your icons as they’re currently arranged. You can rearrange them by grabbing the small diamonds to their left with your mouse and dragging them to their new positions. You can change their labels by clicking Edit, or Delete them.
 
 
 
You can add almost any window in QuickBooks to your fast-access Icon Bar.
 
You’re not limited to the items in the list. Click Add, and the Add Icon Bar Item opens, as pictured above. Click on any of the ones you want to include in the Icon Bar, then click OK.  QuickBooks allows you to add almost any screen to your Icon Bar. Navigate to the window you want to add, then open the View menu and select Add...to Icon Bar. If you never use the Icon Bar, you can collapse it by clicking the small arrow to the right of the Search box at the top of the pane. You can also close the home page by clicking the lower of the two small X’s in the upper right.
 

Tile Your Windows

 
If you regularly work with the same handful of screens, there’s a faster way to access them. Open them all, then open the Window menu and select Tile Vertically. All the windows will be displayed on the same screen, arranged vertically. If there are enough of them, they will overlap. To activate one, just click on it. You can open it to full screen by clicking the small rectangle in the upper right and return to your vertical arrangement by clicking the double rectangle in the upper right.
 
If you’d prefer, you can Tile Horizontally. Or, you can click Cascade to display them stacked on top of each other with only each window’s title label showing, as shown below. If you want to go back to a blank screen and start over, click Window | Close All. The Window menu also displays a list of open windows that can be used for navigation.
 
 
 
If you click Window | Cascade with multiple windows open, QuickBooks will stack them, with only the bottom screen showing. Click on a title label to open a different window.
 

The Desktop View

 
There are other ways you can make QuickBooks work the way you want it to. Open the Edit menu and select Preferences, then Desktop View. Click on the My Preferences tab if it’s not already highlighted. There are several preferences here. Look under the Desktop heading. You can have QuickBooks open to the configuration of windows you want. Your options are:
 
  • Save [the windows that are already open] when closing company.
  • Save current desktop (a specific set of windows).
  • Don’t save the desktop (always open to just the home page).
 
Click the Company Preferences tab to add or remove icons from the home page. This is also where you turn features on and off.
 

We’re Still Here

 
All these suggestions may seem minor to you. But they will save time. More important, they will give you a better sense of control over the hours you spend on accounting tasks. And with so many things out of our control right now, creating a software environment that is tailored to your workflow can benefit you.
 
We know that you may be struggling right now to maintain your financial health, as well as your physical health. More than ever, we hope you’ll contact us if you have a QuickBooks or general accounting problem that we could solve. We’ll be happy to do what we can to help you through during this very challenging period.
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Using QuickBooks' Reminders and Calendar

5/5/2020

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Now, more than ever, you need QuickBooks to track what needs to be done.

 
COVID-19 has transformed the entire U.S. small business landscape in just a few short months. Companies are struggling to stay afloat. We all just want to get back to “normal,” but it’s unclear when that will happen.
 
We’d like to help you as much as possible during these uncertain times. One of the ways we can do that is by supporting you as you keep a close watch on your income and expenses. QuickBooks is our go-to tool for that purpose, and we hope you’re making the best possible use of the software right now.
 
There are steps you can take to ensure that QuickBooks is working quickly and well for you, and that you’re attending to the work you must do every day. The software’s Reminders and Calendar can help you stay current with your accounting.
 

Setting Up Reminders

 
You don’t want to let anything slip through the cracks right now. It’s nearly impossible to keep up with your QuickBooks tasks without using the software’s Reminders feature. Before you start using this, you’ll have to set up its structure. Open the Edit menu and select Preferences | Reminders. This window will open:
 
You can tell QuickBooks which situations should trigger Reminders.
 
This window should open to the My Preferences screen. Click the box in front of Show Reminders List when opening a Company file to create a checkmark. Then click Company Preferences. You’ll see a list of QuickBooks “events,” like Checks to Print. You can tell QuickBooks how many days in advance you’d like to be warned about this pending activity by entering a number in the box in front of days before check date. You can also request that this appear in either Summary or List form. If you don’t want to be notified about any of them, click the button below Don’t Remind Me.  When you’re done here, click OK.
 
The next time you open QuickBooks, your reminders will appear in a window on top of your home page. When you double-click on one, the transaction or other item will open. Two icons in the upper right of the Reminders screen open your Preferences and a blank To Do form. Here, you can schedule a call, task, appointment, etc. and associate it with a customer, vendor, or employee if desired. This item will then appear in your Reminders list.
 
The Reminders window appears when you open the related Company file; you can add To Do’s manually.
 

A Graphical View

 
QuickBooks’ Reminders are not the only way you can ensure that you’re meeting your accounting obligations. You can use the Calendar to see what you’ve scheduled and accomplished every day.
 
As you did with Reminders, though, you should visit this tool’s Preferences page (Edit | Preferences | Calendar). Here, you’ll only need to work with the options under the My Preferences tab. You can choose from among a Daily, Weekly, or Monthly view, or just have QuickBooks Remember last view. Your calendar can display your choice of a Weekly view:a Fixed view of 5 or 7 days or a Variable view of 5/7 days. And, you can show All Transactions, To Do, Transactions Due, or choose one type of transaction (Invoice, Sales Receipt, Bill, etc.).
 
 
How would you like your Calendar displayed? QuickBooks lets you choose from among options.
 
You can also define Upcoming and Past Due Settings. You can Hide or Show these, Show only if data exists, or remember the last settings. QuickBooks allows you to choose the number of days’ worth of data that will be displayed for both Upcoming data and Past due data.
 
You can open the Calendar itself from the Company menu and by clicking a link in the Toolbar or on the Home Page. You’ll see a graphical calendar in the View you selected. Every day where there’s been-or is scheduled to be-activity will say either Due or Entered, with the corresponding number of transactions in parentheses. Below that is a list of Transactions Entered; you can double-click on any of them to see the actual transaction form.
A list of upcoming and past due transactions appears in the right vertical pane. Fields and buttons at the top of the screen allow you to change the View and limit the list to a specified type of transaction. You can also add To Do’s from this page.
 
We hope these tools are helpful for you as you navigate through today’s choppy financial waters. Please do let us know if we can assist you in managing your company’s critical accounting tasks. We want you to keep your business going as best you can until we get to the other side of the ongoing crisis.
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How to Back Up and Move a Company File in QuickBooks

4/7/2020

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Your QuickBooks company file is gold. Make sure you know how to back it up and restore it properly.

 
You may not think of your QuickBooks company file as being portable. It lives safely on the hard drive of your desktop and/or laptop computer. You wouldn’t want it to be anywhere else, right?
 
However, the most common reason businesses move these critical files is because they’ve purchased a new computer or they may also want to share their data. QuickBooks allows you to create a backup filethat you can save to a USB drive or CD, or to another folder on your company’s network. Once it’s available at its destination computer (where a copy of QuickBooks has already been installed), you (or another recipient) will be able to restore it.
 
Note: These instructions were created using QuickBooks 2018. If you don’t see what’s being described here in your version, contact us.
 

Making a Backup

 
You shouldn’t wait until you have to move a QuickBooks company file before backing it up, though. This is something you should be doing regularly.
 
Before you start, make sure your copy of QuickBooks is updated, which shouldn’t be a problem if you’re set up with automatic updates. If you’re not, and you’ve ignored those messages about updates that appear when you open QuickBooks, we can help you launch a manual update and configure QuickBooks to automatically update.
 
With QuickBooks in Single-User Mode, open the File menu and hover over Back Up Company. Select Create Local Backup. You’ll see this window:
 
You can save your QuickBooks backup copy locally or online.
 
Intuit offers a service called Intuit Data Protect ($99.95 annually) that allows you to back up your company file online (we can help you explore this if you’re interested). Let’s assume here, though, that you have a USB drive plugged into your computer and are ready for your backup.
 
Click the button next to Local backup, then the Options button. In the window that opens, you’ll select your destination location and answer a few questions about your backup. One of these gives you the option to get a reminder to back up your file every x times you close QuickBooks, should you choose to do manual backups.
 
Click OK to return to the Create Backup window, then click Next. The following screen gives you the option to save your file and/or schedule future (automatic) backups. If you choose to simply save it now, check that button and click Next to verify the destination location and file name.
 
Note: Before you save your backup file, give it a name that is different from your regular company file. Write down the exact file name and its location.
 
Click Save. A small window will open displaying your progress, and you’ll get a confirmation message when the file has been saved with a .qbb extension. You can now take the removable storage device to the destination computer, where QuickBooks should already be installed.
 
Warning: If you want to schedule automatic backups by clicking on one of the two options in the Create Backup window, please consult with us first. Automated processes in QuickBooks can save time and effort, but when you’re dealing with your irreplaceable company file, you must get it right.
 

Restoring a Backup File

 
Once that’s done, open the File menu and select Open or Restore Company on the destination computer. This window will appear:
 
QuickBooks displays this window when you select File | Open or Restore Company.
 
Click the button in front of Restore a backup copy. Click Next and select Local backup. Then click Next again. Click the down arrow next to the Look in field and click on the location of your backup file to display its contents. Browse until you find the file (it should end in .qbb), then highlight it by clicking on it. Click Open.
 
QuickBooks displays a window that asks where you want to restore your file. You’ll click Next to find it in the Save Company File as window. The Save in field should point to your main QuickBooks directory (like QuickBooks 2018) and the File name field should show the correct file name.
 
When everything looks correct, click Save. QuickBooks will convert your .qbb file to the standard QuickBooks file type, .qbw, and open it.
 

Care Needed

 
Losing your QuickBooks data, as you know, would be absolutely disastrous. But there may be occasions when you’ll need to open a backup copy of your company file on a different computer. We would be happy to walk you through this the first time you do it; in fact, we highly recommend it. As always, we’re available to work with you on any QuickBooks issues you’re experiencing - or to get you up and running for the first time.
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Sales Receipts, Invoices, and Statements in QuickBooks

3/10/2020

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QuickBooks allows you to create multiple types of sales forms for different situations. Here’s a look at what they are and when to use them.

 
When you buy something at a store, you want a piece of paper that shows what you purchased and what you paid. If you receive products or services before you pay for them, you certainly expect to receive a bill. And if you have several transactions with the same company and want clarification on what you’ve paid, and what you owe for a specific time period, the company can usually send you a summary.
 
Your customers want the same things. That financial documentation might be difficult for you to provide if you’re still doing your accounting manually on paper.
 
Fortunately, QuickBooks has a solution. Or, rather, several solutions. The software includes templates for all of the sales forms that you’ll probably ever need: invoices, sales receipts, and statements. Here’s an introduction to when and how to use them.
 

Sales Receipts

 
When a customer pays you on the spot, you can create a sales receipt.
 
When you receive full payment for a product or service at the time of the sale, the correct form to use in QuickBooks is the Sales Receipt. Click the Create Sales Receipts icon on the home page or open the Customers menu and select Enter Sales Receipts. You’ll see a form like the partial one pictured above.
 
Click the down arrow in the Customer:Job field and select the correct one or <Add New>. If you assign transactions to Classes, pick the right one in that list. The Template field should default to the appropriate form. If you’ve created more than one sales receipt template, select the one that you want. Click the icon above the correct payment type.
 
Tip: Want to be able to accept credit cards and eChecks? You’re likely to get paid faster by some customers. You’ll also be able to accept payments on your smartphone or tablet and create receipts. Talk to us about adding this capability.
 
Select the appropriate Item(s) from that drop-down list and enter a Qty (Quantity). Be sure to apply the sale’s Tax status by opening that list. (If you know that you’re responsible for paying sales tax on at least some of your sales but you haven’t set this tracking up in QuickBooks yet, we can work with you on that. It’s important.) When you’ve finished filling in the table with all the goods or services you sold, you can save the transaction and either print it or email it to your customer.
 

Invoices

 
After you’ve completed the top half of an invoice, you’ll see something like this at the bottom.
 
You’ll create and send Invoices to customers when you’ve received either a partial payment or no payment at the time of the sale. Those completed transactions become a part of your total Accounts Receivable (money owed to you). Click Create Invoices on the home page or go to Customers | Create Invoices. Fill out the fields at the top of the screen like you did with your sales receipt; the forms are almost the same. Invoices, though, have Bill To and Ship To addresses, as well as fields for the sale’s Terms and Due Date.
 
You shouldn’t have to do anything with the bottom half of the screen (pictured above) unless you want to include a Customer Message, since the information here is carried over from the top of the screen. Check to make sure the Tax Code is correct, though.
 
It’s important to note, it's an either/or situation when it comes to creating an invoice and a sales receipt for the same transaction. It’s best to not use sales receipts for invoice payments, as it can cause issues.
 

Statements

 
When you create statements, you’ll first choose the customers who should receive them.
 
Statements are very useful when you have multiple customers who are past due on their payments (you can find this out by running the A/R Aging Summary report, which you’ll find under Reports | Customers & Receivables). Click the Statements link on the home page or go to Customers | Create Statements. You’ll first have to select the customer(s)who should be on your list, as pictured above. There are several other options on this page that will help you refine this group. When you’re done, QuickBooks will automatically generate them, and you can print or email them.
 
You’ll save a lot of time when you use QuickBooks’ sales forms. Your bookkeeping will also be more accurate, and it will be easier to track down specific transactions. If you use them conscientiously, you’ll be able to run reports that provide comprehensive overviews of various elements of your finances.
 
Do you have questions about any of this, or are you just getting started with QuickBooks? We’re happy to schedule a consultation to determine what your needs are and how we can assist. Contact us, and we’ll set something up.
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Dealing with Deposits in QuickBooks

2/11/2020

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Where do the payments you receive in QuickBooks go? The software provides tools for managing deposits.

 
Recording payments, whether they come in to comply with an invoice you sent or are issued as sales receipts, is one of the more satisfying tasks you do in QuickBooks. The sales cycle is almost complete, and you’re about to have more money in the bank - once you document the payments as bank deposits.
 
Unless you use QuickBooks Payments, which moves your company’s remittances into an account automatically, you’ll have to deal with your deposits twice. First, you’ll have to make out a deposit slip for the bank. You’ll also need to record the deposit in QuickBooks itself.
 
Fortunately, the software makes this easy for you. Here’s how it works.
 

A Special Account

 
By default, QuickBooks transfers payments received into an account called Undeposited Funds. You can see it in your Chart of Accounts by clicking the Chart of Accounts icon on QuickBooks’ home page and scrolling down a bit. Look over to the end of the line and you’ll see its current balance. This account is an Other current asset. It holds your payments until you record them as deposits and take your money to the bank.
 
When you’re getting ready to take cash and checks to the bank, click the Record Deposits icon on the home page. The Payments to Deposit window will open.
 
When money moves into Undeposited Funds from invoice payments or sales receipts, it’s displayed in the Payments to Deposit window.
 
We recommend completing your physical deposit slip first, based on the checks and cash you have in hand. Then, match them to payments in the window pictured above. You can click in front of each one you’ve matched to create a checkmark. When you’ve finished, click OK. The Make Deposits window will open. Make sure that the account you want to Deposit to is showing in the upper left corner. You can add a Memo and change the Date if needed.
 
Do you want cash back from your deposit? You may want to move this to Petty Cash, for example. Click the down arrow in the Cash goes back to field and select the correct account. Add a memo if necessary and enter the Cash back amount. When you’re done, save the transaction. QuickBooks now knows that you’re taking a deposit slip to the bank.
 
The total for your handwritten deposit slip and the final tally in the Make Deposits window should be the same. This will ensure that the amount deposited in your bank account will match the bank deposit amount in QuickBooks when reconciling. If you have leftover cash or checks, you’ll need to track down their origins and create new transactions.
 

Checking Your Work

 
It’s a good idea to check your Undeposited Funds account occasionally to make sure that you haven’t left money undeposited. To do this, open your Chart of Accounts again. Right-click Undeposited Funds and click on QuickReport: [number] Undeposited Funds. All should be selected in the Date field in the upper left. Click on Customize Report and select the Filters tab. Scroll down in the Filters list and click on Cleared. Select No and click OK to display your report.
 
You can customize your QuickReport to see if you’ve neglected to deposit any payments. If this list contains any, open the Banking menu and select Make Deposits to follow the steps above again.
 

Changing Your Destination Account

 
As we’ve already mentioned, QuickBooks is set up to automatically move payments into Undeposited Funds. We recommend leaving it this way so you can easily check for money that hasn’t been deposited. You can change this, though. If you feel it’s necessary, let us know, and we’ll help you modify your destination account.
 

Working with Payment Methods

 
QuickBooks comes with a default set of payment methods. You can add to these and/or make existing ones inactive, so they don’t clutter up the drop-down list. Open the Lists menu and select Customer & Vendor Profile Lists | Payment Method List. If you don’t accept Discover cards, for example, right-click on that entry and select Make Payment Method Inactive. To add one, click the down arrow next to Payment Method and then New. The Payment Method should always match the Payment Type.
 

Precision Critical

 
Account reconciliation is difficult enough without having to deal with deposit discrepancies. Treat this element of your accounting with great care and let us know how we can help with account management, financial reporting or any other QuickBooks-related issues. We can troubleshoot - or even take over bookkeeping tasks that are vexing you.
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Start 2020 Right: Get into the Report Habit

1/7/2020

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It’s a good time to start new habits - or refresh old ones. Running reports regularly will help you make better business decisions.

 
Whether or not you made New Year’s resolutions, you probably look at January as a fresh start in personal and professional matters. Unfortunately, we can’t help you join a gym or organize your closets or meet your monthly sales goals.
 
What we can do, though, is encourage you to start a new habit that may actually leave you more time for those activities and even improve your company’s financial bottom line. We’re talking about committing to using the reporting tools QuickBooks offers.
 
You can’t possibly know how your business is doing unless you take advantage of this critical feature. It’s the payoff for all the hard work you do keeping up with your daily accounting workflow. Here are five things you should try.
 

Visit QuickBooks’ Report Center:

As you know. QuickBooks devotes an entire menu to reports, dividing them into types (Sales, Purchases, Inventory, etc.). When you hover your mouse over one of these categories after opening the Reports menu, you’ll see a list of all related reports.
 
Click on Report Center, though, and you’ll see a kind of home page for reports. They’re categorized by type, just like in the main Reports menu, but there’s much more you can do here.
 
 
Click on a report name in the Report Center and you’ll have numerous options.
 
When you click on the graphic representing a report, you’ll first be able to change the date range by clicking on the down arrow. Then you can Run the report, see a brief explanation by clicking Info, click on Fave to add it to your list of Favorites, or open Help. The tabs at the top of the screen allow you to toggle between these Standard views, reports you’ve Memorized, Favorites, Recent, and Contributed (report templates created by individuals outside of Intuit).
 
If you know exactly what reports you want to run it’s probably easier to just use the Reports menu, but the Report Center is a great place to learn about and organize your content.
 

Customize Your Reports:

You’re probably used to changing the date range on your reports, but have you ever explored any of QuickBooks’ other customization tools? You can use them on any report. Click the Customize Report button in the upper left. Click on the Display tab, and you can change the report’s columns by checking or unchecking entries in the list. Filters are more complex, and you may need our help setting up very specific, multi-filter reports. They offer a way to pare down your report to contain just the data you want. You could, for example, prepare a report that only includes one or more Transaction Types or customers who live in a specified state.
 

Memorize Your Reports:

Once you’ve changed columns and filters in a report you’ll run frequently, you can save those settings so you don’t have to go through all of that again. Open any report and click the Memorize button in the upper toolbar. The window that opens will ask if you want to save that customized report to a Memorized Report Group, which you can do by clicking the box and opening the list of groups. Either way, you can find your report by opening the Reports menu and selecting Memorized Reports.
 
If you want to create a new Memorized Report Group, open the Reports menu and click Memorized Reports | Memorized Report List. Open the Memorized Report drop-down menu and select New Group.
 

Schedule Your Reports:

The best way to get your report habit started is by creating a schedule of reports you need to see regularly. You can do this by setting up Reminders (Company | Reminders). Click the gear icon in the upper right corner to specify your Preferences and the + (plus) sign to add a reminder. QuickBooks 2017 and later versions offer a scheduling tool that allows you to share reports withothers, but please don’t try this on your own. It’s a complicated procedure with many rules.
 
You’ve probably noticed that there is a report category called Accountant & Taxes. Some of these should be created monthly or quarterly, but you’ll need our help analyzing them as well.
 
In the coming year, we strongly encourage you to expand your skills at generating reports. You can’t make realistic, effective plans for the future of your company without knowing its current financial state and its history. So start the year off right in 2020, and let us know how we can help.
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How to Clean Up QuickBooks for 2020

12/10/2019

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We know December is a busy month. However, take some time now to make sure QuickBooks is ready for 2020.

 
Yes, it’s here again: the end of the year. You probably have a lengthy to-do list full of tasks that must be done before December 31. There’s one task-or rather, a series of tasks-that you should definitely add to that list: year-end QuickBooks cleanup. Following the guidelines provided here will do three things. It will:
  • Ensure that you’ve processed every 2019 transaction (or that you know why you can’t).
  • Give you a sense of closure, knowing that you’ve dealt with all your 2019 financial data.
  • Allow you to start your 2020 QuickBooks activities with as clean of a slate as possible.

First Things First

 
Before you start looking at transactions and running reports, check to make sure that your fiscal year is recorded correctly in QuickBooks. Open the Company menu and select My Company. Click the pencil icon in the upper right to open the Company Information window, then click Report Information in the tabs to the left. This window opens:
 
Is your company’s fiscal year recorded correctly in QuickBooks? If not, please contact us. Don’t try to fix this on your own.
 

Account For All Of Your Income

 
You certainly want to have received all the money owed to you by December 31 if at all possible. So, run a report to see which customers have outstanding, overdue balances. Open the Reports menu and select Customers & Receivables | A/R Aging Summary.
 
The first column here will read Current. You don’t have to worry about these customers. It’s the next four columns that will require follow-up. If your default payment terms are 30 days, you’ll see columns for 1-30, 31-60, 61-90, and >90. Customers with dollar amounts in those columns have not met their obligations and are past due by those date ranges.
 
Note: If your default terms are different (like 15 days), you’ll need to customize the report. In the toolbar at the top, you’ll see a field labeled Interval (days). Change it to reflect your own default terms and click Refresh in the upper right corner.
 
If your report contains only a sea of zeroes in those four columns, everyone is paid up. If not, you can send statements to anyone who is at least one day past due to remind them of what they owe. Open the Customers menu and select Create Statements to see this window:
 
Partial view of the Create Statements window
 
Make sure the Statement Date is correct since QuickBooks will use this to calculate aging. Then you can either enter a specific Statement Period or request All open transactions as of Statement Date. If you choose the latter, you’ll most likely want to limit the statements to customers whose payments are overdue. So, you’d click in the box in front of Include only transactions over [your number here] days past due date.
 
Below these options, you’ll be able to indicate which customers should receive statements. The most common choice is All Customers (who fall into the group you just defined), but you can also send to one or multiple customers, for example. QuickBooks will display a list if you select one of these. The right pane of this window contains several additional options that you can check or uncheck. When you’re satisfied, you can Preview, Print, or E-mail the statements.
 

Pay Outstanding Bills

 
You should also try to settle your Accounts Payable before the end of the year. Open the Reports menu and select Vendors & Payables | A/P Aging Summary. Look for dollar amounts in the columns that show aging beyond the first column. You can also run the Unpaid Bills Detail report and look at the Aging column, as pictured here:
 
Look in the aging column of this report to see which bills are past due and by how many days.
 
Note: QuickBooks has multiple Preferences that relate to reports and aging. We can go over these with you if you haven’t explored them.
 
There are other tasks you should complete before December 31, some of which may require our assistance. These include reconciling all accounts, running year-end reports, and clearing any deposits that remain in the Undeposited Funds account. We’re here if you need us now, otherwise we can connect in the New Year.
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Setting Up Sales Tax in QuickBooks, Part 2

11/1/2019

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Now that you have your sales taxes set up, you’ll be able to use them in transactions and reports.

 
Last month, we talked about the process of setting up sales taxes in QuickBooks. To recap a bit, you first have to go to Edit | Preferences | Sales Tax to make sure the software is set up correctly for this use. This means you’ll need to understand exactly what your state and local sales tax rules are. You can learn this by going to your state’s Department of Revenue or Department of Taxation website.
 
State sales taxes are considered Items in QuickBooks; you create them like you would create product records. When local sales taxes are also required, you can set up Sales Tax Groups. You’ll be assigning these Items as well as Tax Codes to customers.
 

Using Sales Taxes

 
Once you have sales taxes set up, you can start using them in transactions. You can create them on the fly from within transactions, but we recommend taking care of this important housekeeping task before you start.
 
QuickBooks applies the Sales Tax Item or Sales Tax Group that you assigned to the customer on your invoices. You can see the others that are available.
 
Start by creating an invoice. When you reach the Tax column for your first line item, you’ll see that QuickBooks has already assigned Tax or Non to it based on the information in the item’s record. You can mix taxable and non-taxable items on the same invoice. You can also add a new sales tax on the fly from the invoice itself. Click the down arrow in the Tax column and select <Add New>.
 
Be sure you’re not required to pay sales tax on an item when Non is selected. You may not have to charge sales tax on, for example:
  • Nonprofit organizations
  • Out-of state sales
  • Items that your customers will resell
Tip: If you’d like, you can create more specific sales tax codes for these situations. You could use OOS for out-of-state sales, for example, LBR for labor, and NPO for nonprofit organization.
 
 
QuickBooks already includes Sales Tax Codes Tax and Non, but you can add additional ones that are more descriptive.
 
Be very careful with your sales tax classifications in QuickBooks. As we said last month, such errors will be discovered in a sales tax audit, should you ever be subject to one.
 
Once you’ve entered all the line items in the invoice, look down toward the bottom of the screen, directly beneath the table containing invoiced items and above the Total. QuickBooks will have calculated the sales tax due using the Sales Tax Item or Group you assigned to that customer during setup, placing it in the Tax field.
 
Look to the left of those numbers, and you’ll see the actual rate that was applied. To the left of that is a drop-down list containing the correct Sales Tax Item or Sales Tax Group. Click the down arrow if you want to see the list of other options. And in the lower left of the screen, you’ll see the Customer Tax Code.
 

The Sales Tax Center

 
The Manage Sales Tax window
 
When it’s time to pay sales taxes, you’ll open the Vendors menu and select Sales Tax | Manage Sales Tax. From the screen that opens, you’ll be able to:
  • Access Sales Tax Preferences.
  • Generate sales tax reports that will help you fill out required forms.
  • Visit related screens.
There are two reports you’ll need to run: Sales Tax Liability (displays total sales, amounts that are taxable and at what rates, taxes collected, and how much sales tax is due to each taxing agency) and the Sales Tax Revenue Summary (breaks down total sales into taxable and non-taxable). These reports are, of course, customizable, so you can filter them, for example, by Sales Tax Code.
 

A Delicate Balance

 
Collecting the correct amount of sales tax on taxable items and submitting the right tax totals to the right agencies takes vigilance. You don’t want to charge customers for unnecessary taxes, but you also don’t want to end up paying taxes you should have invoiced out of your own pocket.
 
We can help you get this straight from the start. It’s much easier to spend some time setting up sales tax accurately in QuickBooks than it is to go back and untangle inaccurate records. Give us a call and we’ll set up a consultation.
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    Author

    Julie L. Davis, CPA is the founder and owner of JD and Company in Yorba Linda, CA.  The company specializes in both for-profit and non-profit organizations, providing accounting, bookkeeping services, and tax preparation for small businesses. 

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