Introduction 1 About This Book 1 Foolish Assumptions 2 Icons Used in This Book 3 Beyond the Book 3 Where to Go from Here 3 Part 1: Quickly into QuickBooks 5 Chapter 1: QuickBooks: The Heart of Your Business 7 Why QuickBooks? 7 Why you need an accounting system 8 What QuickBooks does 9 Why not QuickBooks online? 10 What Explains QuickBooks' Popularity? 11 What's Next, Dude? 12 How to Succeed with QuickBooks 13 Budget wisely, Grasshopper 13 Don't focus on features 14 Outsource payroll 15 Get professional help 16 Use both the profit and loss statement and the balance sheet 16 Chapter 2: The Big Setup 17 Getting Ready for QuickBooks Setup 17 The big decision 18 The trial balance of the century 19 The mother of all scavenger hunts 22 Stepping through QuickBooks Setup 23 Starting QuickBooks 23 Using the Express Setup 25 The Rest of the Story 32 Should You Get Your Accountant's Help? 33 Chapter 3: Populating QuickBooks Lists 35 The Magic and Mystery of Items 35 Adding items you might include on invoices 37 Creating other wacky items for invoices 45 Editing items 48 Adding Employees to Your Employee List 49 Customers Are Your Business 51 It's Just a Job 55 Adding Vendors to Your Vendor List 58 The Other Lists 62 The Fixed Asset Item list 63 The Price Level list 64 The Billing Rate Levels list 64 The Sales Tax Code list 64 The Class list 64 The Other Names list 65 The Sales Rep list 65 Customer, Vendor, and Job Types list 66 The Terms list 66 The Customer Message list 66 The Payment Method list 67 The Ship Via list 67 The Vehicle list 67 The Memorized Transaction list 67 The Reminders list 68 Organizing Lists 68 Printing Lists 68 Exporting List Items to Your Word Processor 69 Dealing with the Chart of Accounts List 69 Describing customer balances 70 Describing vendor balances 70 Camouflaging some accounting goofiness 70 Supplying the missing numbers 77 Checking your work one more time 79 Part 2: Daily Entry Tasks 81 Chapter 4: Creating Invoices and Credit Memos 83 Making Sure That You're Ready to Invoice Customers 84 Preparing an Invoice 84 Fixing Invoice Mistakes 91 If the invoice is still displayed onscreen 91 If the invoice isn't displayed onscreen 91 If you need to delete an invoice 92 Preparing a Credit Memo 92 Fixing Credit Memo Mistakes 96 Taking Lessons from History 96 Printing Invoices and Credit Memos 97 Loading the forms into the printer 97 Setting up the invoice printer 97 Printing invoices and credit memos as you create them 100 Printing invoices in a batch 101 Printing credit memos in a batch 103 Sending Invoices and Credit Memos via Email 104 Customizing Your Invoices and Credit Memos 105 Chapter 5: Reeling in the Dough 107 Recording a Sales Receipt 108 Printing a Sales Receipt 112 Special Tips for Retailers 114 Correcting Sales Receipt Mistakes 115 Recording Customer Payments 116 Correcting Mistakes in Customer Payments Entries 120 Making Bank Deposits 121 Improving Your Cash Inflow 124 Tracking what your customers owe 124 Assessing finance charges 125 Dealing with deposits 129 Chapter 6: Paying the Bills 131 Pay Now or Pay Later? 131 Recording Your Bills by Writing Checks 132 The slow way to write checks 132 The fast way to write checks 138 Recording Your Bills the Accounts Payable Way 140 Recording your bills 141 Entering your bills the fast way 144 Deleting a bill 146 Remind me to pay that bill, will you? 147 Paying Your Bills 148 Tracking Vehicle Mileage 152 Paying Sales Tax 153 Chapter 7: Inventory Magic 155 Setting Up Inventory Items 156 When You Buy Stuff 157 Recording items that you pay for up front 157 Recording items that don't come with a bill 157 Paying for items when you get the bill 159 Recording items and paying the bill all at once 161 When You Sell Stuff 161 How Purchase Orders Work 162 Customizing a purchase order form 163 Filling out a purchase order 163 Checking up on purchase orders 166 Receiving purchase order items 166 Assembling a Product 167 Identifying the components 167 Building the assembly 167 Time for a Reality Check 169 Dealing with Multiple Inventory Locations 171 Manually keep separate inventory-by-location counts 171 Use different item numbers for different locations 171 Upgrade to QuickBooks Enterprise Solutions 172 The Lazy Person's Approach to Inventory 172 How periodic inventory systems work in QuickBooks 173 The good and bad of a periodic inventory 173 Chapter 8: Keeping Your Checkbook 175 Writing Checks 175 Writing checks from the Write Checks window 176 Writing checks from the register 177 Changing a check that you've written 179 Packing more checks into the register 180 Depositing Money in a Checking Account 181 Recording simple deposits 181 Depositing income from customers 182 Transferring Money between Accounts 184 Setting up a second bank account 185 Recording deposits into the new account 185 About the other half of the transfer 186 Changing a transfer that you've already entered 187 Working with Multiple Currencies 187 To Delete or to Void? 188 Handling NSF Checks from Customers 189 The Big Register Phenomenon 190 Moving through a big register 190 Finding that darn transaction 191 Chapter 9: Paying with Plastic 193 Tracking Business Credit Cards 193 Setting up a credit card account 194 Selecting a credit card account so that you can use it 195 Entering Credit Card Transactions 196 Recording a credit card charge 197 Changing charges that you've already entered 199 Reconciling Your Credit Card Statement and Paying the Bill 200 So What about Debit and ATM Cards? 201 So What about Customer Credit Cards? 201 Part 3: Stuff You Do from Time to Time 203 Chapter 10: Printing Checks 205 Getting the Printer Ready 205 Printing a Check 209 A few words about printing checks 209 Printing a check as you write it 209 Printing checks by the bushel 211 What if I make a mistake? 213 Oh where, oh where do unprinted checks go? 214 Printing a Checking Register 214 Chapter 11: Payroll 217 Getting Ready to Do Payroll without Help from QuickBooks 217 Doing Taxes the Right Way 218 Getting an employer ID number 218 Signing up for EFTPS 219 Having employees and employers do their part 219 Getting Ready to Do Payroll with QuickBooks 219 Paying Your Employees 221 Paying Payroll Liabilities 224 Paying tax liabilities if you use a full-meal-deal payroll service 224 Paying tax liabilities if you don't use a full-meal-deal payroll service 224 Paying other nontax liabilities 225 Preparing Quarterly Payroll Tax Returns 225 Using the Basic Payroll service 226 Using a full-meal-deal payroll service 226 Using the QuickBooks Enhanced Payroll service 226 Filing Annual Returns and Wage Statements 227 The State Wants Some Money, Too 228 Chapter 12: Building the Perfect Budget 229 Is This a Game You Want to Play? 229 All Joking Aside: Some Basic Budgeting Tips 230 A Budgeting Secret You Won't Learn in College 231 Setting Up a Secret Plan 232 Adjusting a Secret Plan 235 Forecasting Profits and Losses 235 Projecting Cash Flows 235 Using the Business Planner Tools 236 Chapter 13: Online with QuickBooks 237 Doing the Electronic Banking Thing 237 So what's the commotion about? 237 A handful of reasons to be cautious about banking online 238 Making sense of online banking 241 Signing up for the service 241 Making an online payment 241 Transferring money electronically 243 Changing instructions 244 Transmitting instructions 244 Message in a bottle 245 A Quick Review of the Other Online Opportunities 246 Part 4: Housekeeping Chores 247 Chapter 14: The Balancing Act 249 Balancing a Bank Account 249 Giving QuickBooks information from the bank statement 250 Marking cleared checks and deposits 252 Eleven Things to Do If Your Non-Online Account Doesn't Balance 256 Chapter 15: Reporting on the State of Affairs 259 What Kinds of Reports Are There, Anyway? 260 Creating and Printing a Report 262 Visiting the report dog-and-pony show 264 Editing and rearranging reports 265 Reports Made to Order 268 Processing Multiple Reports 270 Your Other Reporting Options 271 Last but Not Least: The QuickReport 272 Chapter 16: Job Estimating, Billing, and Tracking 273 Turning On Job Costing 273 Setting Up a Job 274 Creating a Job Estimate 275 Revising an Estimate 278 Turning an Estimate into an Invoice 278 Comparing Estimated Item Amounts with Actual Item Amounts 279 Charging for Actual Time and Costs 280 Tracking Job Costs 282 Chapter 17: File Management Tips 283 Backing Up Is (Not That) Hard to Do 283 Backing up the quick-and-dirty way 285 Getting back the QuickBooks data you backed up 289 Making an Accountant's Copy 292 Working with Portable Files 292 Using an Audit Trail 293 Using a Closing Password 293 Chapter 18: Fixed Assets and Vehicle Lists 295 What Is Fixed-Assets Accounting? 295 Fixed-Assets Accounting in QuickBooks 297 Setting Up a Fixed Asset List 297 Adding items to the Fixed Asset list 298 Adding fixed-asset items on the fly 300 Editing items in the Fixed Asset list 300 Tracking Vehicle Mileage 302 Identifying your vehicles 302 Recording vehicle miles 303 Using the vehicle reports 304 Updating vehicle mileage rates 305 Part 5: The Part of Tens 307 Chapter 19: Tips for Handling (Almost) Ten Tricky Situations 309 Tracking Depreciation 309 Selling an Asset 310 Selling a Depreciable Asset 311 Owner's Equity in a Sole Proprietorship 312 Owner's Equity in a Partnership 312 Owner's Equity in a Corporation 313 Multiple-State Accounting 314 Getting a Loan 314 Repaying a Loan 315 Chapter 20: (Almost) Ten Secret Business Formulas 317 The First "Most Expensive Money You Can Borrow" Formula 318 The Second "Most Expensive Money You Can Borrow" Formula 320 The "How Do I Break Even?" Formula 320 The "You Can Grow Too Fast" Formula 323 How net worth relates to growth 323 How to calculate sustainable growth 324 The First "What Happens If . . .?" Formula 325 The Second "What Happens If . . .?" Formula 327 The Economic Order Quantity (Isaac Newton) Formula 329 The Rule of 72 330 Part 6: Appendixes 333 Appendix A: Installing QuickBooks in 10 Easy Steps 335 Appendix B: If Numbers Are Your Friends 339 Keying In on Profit 339 Let me introduce you to the new you 339 The first day in business 340 Look at your cash flow first 340 Depreciation is an accounting gimmick 341 Accrual-basis accounting is cool 342 Now you know how to measure profits 343 Some financial brain food 343 In the Old Days, Things Were Different 344 What Does an Italian Monk Have to Do with Anything? 347 And now for the blow-by-blow 349 Blow-by-blow, Part 2 352 How does QuickBooks help? 354 Two Dark Shadows in the World of Accounting 354 The first dark shadow 354 The second dark shadow 355 The Danger of Shell Games 356 Appendix C: Sharing QuickBooks Files 357 Sharing a QuickBooks File on a Network 357 User permissions 357 Record locking 359 Installing QuickBooks for Network Use 359 Setting User Permissions 361 User permissions in Enterprise Solutions 361 User permissions in QuickBooks Pro and Premier 362 Specifying Multiuser Mode 364 Working in Multiuser Mode 364 Index 367
Stephen L. Nelson, MBA, CPA, MS in Taxation holds an MBA in finance and an MS in taxation. He has been an adjunct professor of taxation at Golden Gate University's graduate tax school, and today he is the managing member of a CPA firm. Steve's books on QuickBooks and Quicken have sold more than five million copies and have been translated into 11 languages.