New Business Direction LLCGreetings!
When your goods come rolling in, be sure to document them correctly.
You’re probably happy to see couriers delivering inventory items you’ve ordered since it means you can ship to customers, but recording the new stock means yet another repetitive task.
QuickBooks’ tools can help with this, but you need to be sure you’re using the right forms. There are two different ones that you’ll use, depending on whether or not you’ve received a bill.
Bill in Hand
Either way, you’ll get started by opening the Vendors menu (or clicking the arrow next to Receive Inventory on the home page). If you do have a bill, select Receive Items and Enter Bill (Receive Inventory with Bill on the home page). The Enter Bills screen opens; select your vendor from the drop-down list. If you had entered a purchase order, you’ll see something like this:
Now the PO item information has been entered in the window. Check the form for accuracy, then save it.
Of course, if there was no purchase order, you’ll enter the information about the items you received (descriptions, prices, etc.) in the Enter Bills screen.
If you receive items without a bill, you still need to document the shipment. Open the Vendors menu and select Receive Items (or click the arrow next to the Receive Inventory icon on the home page and select Receive Inventory without Bill).
The Create Item Receipts window opens. Select the vendor by clicking the down arrow next to that field. If a message about existing purchase orders for that vendor appears, click Yes or No, and either select the appropriate POs or enter the information about what you received.
If the items were already earmarked for a specific customer on the purchase order, the Customer column will have an entry in it, and there will be a check mark in the Billable column. If there was no purchase order and you’re entering the information, you can complete those two fields manually
Figure 2: If a purchase order was already assigned to a customer and is billable, that information should appear in this windowEnter a reference number if you’d like. The Memo field should already be filled in with Received items (bill to follow), and the Bill Received box should not be checked.Warning: Be sure that the Items tab is highlighted when you’re recording physical inventory. If there are related costs like freight charges or sales tax, click the Expenses tab and enter them there.
When the bill comes in for merchandise that you’ve already recorded on an Item Receipt, you’ll use this procedure to pay it:
* Click Vendors | Enter Bill for Received Items, which opens the Select Item Receipt window.
* Select the vendor, then the correct Item Receipt.
Note: If the bill corresponds to more than one Item Receipt, you’ll need to convert each into a bill separately. You can create a new bill if some items received were not accounted for on Item Receipts.
* Click the box next to Use the item receipt date for the bill date if you want to match it to the inventory availability date.
* Click OK. The Enter Bills screen opens, which can be processed like you’d handle any bill.
Though it may seem like extra work, this last procedure is important, since it prevents you from recording the same inventory items twice.
It’s easy to get tangled up on these procedures. We hope you’ll consult us when you begin implementing inventory management in QuickBooks, or when you’re taking on a new task there. It’s a lot easier to prevent errors than to go back and fix them.
This article of QuickBooks Tips and Tricks was based on the 2013 version of QuickBooks.
Cash flow improvement is a hot issue for small businesses; in many businesses, it seems like there is never enough cash when you need it. The last thing a business owner wants is to reduce their cash balance unnecessarily. To help you preserve or increase your cash, here are five cash management leaks to avoid.
1. Bloated Bank Fees
Some banks are more business-friendly than others. We recommend you assess the fees you are currently being charged to see if you can discontinue any unnecessary services.
- Could you maintain a cash balance to avoid monthly fees?
- Are you being charged online banking fees and bill pay fees, and are these still necessary?
- Are you being charged for a high volume of transactions or cash drawer services, and are these competitive with other banks?
Banks, including national brands, that have not kept up with technology and have not automated a significant amount of their transactions are inefficient and must charge higher fees to cover their processing costs. If your accounts are located at one of these costlier banks, you do have a choice.
2. Overtaxed
Are you sure that you are paying the lowest amount of taxes you legally owe? There are several places to look to make sure you have not overpaid taxes anywhere in your business or personally:
Payroll taxes- Sales and use tax
- Franchise taxes
- State and local income taxes
- Property taxes
- Federal income taxes
- Taxes that are specific to your industry
In preparing income taxes, a few of the easiest items to overlook include carryovers from prior years and new deductions you become eligible for. If you received a large refund this year, congratulations, but that means you gave Uncle Sam an interest-free loan on your money. You can do better next year by estimating your tax payments and paying only what’s due.
3. The Check Is in the Mail 
Customers who take too long to pay you are big cash drains in your business. Consider changing your terms, asking for deposits, or becoming more aggressive with collections to bring your DSO (days sales outstanding) down. When you do, you’ll get an instant, permanent cash flow improvement.
4. Sweat the Small Stuff
You may have an eagle eye on your largest bank account, but what about your other cash stashes? PayPal, petty cash, and business savings accounts are among the places that may not get daily scrutiny. Make sure those accounts are properly reconciled and have the proper controls in place so funds don’t go missing.
5. It’s in Your Interest
A nice problem to have is when your bank balances get too large and you don’t need the money immediately. Make 
sure that money is still working hard for you by putting the excess in an interest-bearing account. It’s not much these days, but every little bit helps.
Make a Dash to the Cash
If we can help you plug any of these cash leaks in your business, please don’t hesitate to reach out and let us know.
Greetings!
So Hard to Choose
If you have lots of ideas in your head or on your “to do” list that are not getting done, you’re certainly not alone. Here’s a process for helping you decide what to do first, next, and not at all.
Once you have everything down on paper, you will be amazed at how much this unclutters your thinking. You will also have all your great ideas captured so you don’t forget them. You might also get very overwhelmed, but don’t stop now. Relief is on the way.
Step 2:
Add some information about each item, creating four additional columns:
Step 3:
Analyze your choices
- Separate tasks that are working ON vs. IN your business. There is never enough time to work on your business, so force it by blocking out a few hours or a half-day a week and do it, no matter what. It might be the best way to make progress in your business.
- Sort the list by how much revenue the task could generate or how much potential it has, and decide how to prioritize from there. If you need help calculating the ROI, return on investment of an idea, we can help you calculate that.
- Take a look at what you marked “not able to delegate,” and ask “why not?” Does a procedure need to be written? Do you need more staff? Does your staff need training? Or do you need to learn to let go? Whatever it is, and especially if there are a lot of these items, get these roadblocks tackled so you don’t become the bottleneck in your own business.
- Sort the list by “column D” above, the market value you recorded for the task. Then ask yourself what your hourly rate is. How many tasks are you doing that are below your hourly rate? Hiring someone to do your lowest level tasks could very well be another item you need to add to your new “to do” list.
This last one is really important, because it can so strongly affect the profitability of your business. The last thing you want to do is go backwards and give yourself a demotion with a pay decrease, but that’s exactly what you’re doing each time you do a task yourself that’s at a low market rate.
Prioritize with confidence
Time
There’s nothing more precious and scarce than our time. Every day, we have a choice about how to spend it, but too often we get caught up in the urgent, but not important, daily fires. This exercise helps us take a step back and look at what’s important instead of what’s urgent.
Not using progress invoices? Maybe you should be.
Greetings!
The U.S. economy may be picking up, but your customers are probably still being very careful with expenditures. If your company’s finances will allow it, you can help them out on sizable jobs by using progress invoicing, also known as partial billing or progress billing.
You could, of course, simply create invoices for smaller chunks of the job as they come. A smarter way is to build estimates for the entire job or sequential phases so your customer can see the big picture. You can still use progress invoicing to start collecting funds one segment at a time.
How to Proceed
First, be sure you have progress invoicing turned on. Go to Edit | Preferences | Jobs & Estimates | Company Preferences and make sure the Yes button is filled in next to the questions about estimates and progress invoicing.
Now create your estimate (these instructions are for QuickBooks Premier 2013; your steps may vary slightly). Go to Customers | Create Estimates. When you’ve entered all of the items you want to include in this phase of your project, click the Create Invoice button. This window will open:
By clicking one of these buttons, you can bill the customer 100 percent of what’s due on the invoice or just a percentage. But let’s say you and your customer have agreed that payment will be due in pre-defined stages, so click the third button and select one or more of the line items. Click OK. QuickBooks will display a new window that lets you select items and/or percentages of amounts due.
In our example here, we’re going to invoice the customer for two items, the blueprints and floor plans. So we selected the button next to Show Quantity and Rate and entered the full estimated quantity for each item in the QTY columns (if you chose Show Percentage, new columns would appear). It would look like this:
Click OK. QuickBooks will return to your progress invoice, which you can save and print or email to your customer. Your original estimate will remain unchanged.
Tip: If you don’t want any of the zero amounts to appear on the progress invoice, go to Edit | Preferences | Jobs & Estimates | Company Preferences and make sure there’s a check mark in the box next to Don’t print items that have zero amount.
Following Up
When you want to bill for another set of items on this estimate, simply repeat these steps.
Here’s an easy way to determine how much (if any) of the estimate has been invoiced. Go to the Customer Center and select the customer. Click the arrow next to the Show field and select Estimates. Any estimate that has a zero in the OPEN BALANCE column has been completely billed.
QuickBooks provides a report that tells you where you are with all of your progress invoices. Go to Reports | Jobs, Time & Mileage | Job Progress Invoices vs. Estimates. Your report will include the progress invoice you just created:
More Options
What if you determine that you won’t have one or more of the items on the estimate? QuickBooks lets you quickly generate a purchase order. With your estimate open, click Create Purchase Order to select the item(s) needed and generate the form. You can also click Create Sales Order if one is necessary.
Estimates provide a useful way to fine-tune your bookkeeping and inform your customers about impending costs. They can also be confusing if you don’t keep up with them. We can help you determine when they’re a good idea and how to keep them organized. QuickBooks provides good tools here, but they require some administrative control.
This article of QuickBooks Tips and Tricks was based on the 2013 version of QuickBooks.
As entrepreneurs, we work hard for our money, and the last thing we need is to have it disappear due to fraud, hackers, or identity theft. Some people have called 2013 the year of the hacker, which is worrisome. But you’re far more likely to experience risks with disgruntled or financially desperate employees and contractors. Mistakes happen too, and when they do it can be costly to get them corrected.
Here are five ways to increase your financial controls so that you can lower your business risks when it comes to the handling of cash and cash equivalents. As you read the list, check to see where you can tighten up controls in your business.
1. Checking your Checks
Do you have blank checks lying around? If so, reduce the temptation and get them locked up. You can also go a step further and have your accountant run a report each month of missing check numbers. If any checks are unaccounted for, take action by processing Stop Payment orders at your bank.
2. Bank on It
If you are still getting your bank reconciliation on paper, where does it get mailed? The business owner should always see the bank reconciliation before anyone else does. Also, make sure the person that performs the reconciliation is not the same person that deposits the checks. Segregation of duties is essential to improve cash controls.
Today, it’s a good idea to do all your banking online, if possible, so that nothing gets mailed. In that way, you have some reduced risk over identity theft.
Some banks offer multiple-user access to your banking account, so that bookkeepers can get the information they need. Lock that user ID down as much as possible, so that the user can only get to what they need to. If they’re honest, they will appreciate the reduced level of responsibility and consider it a smart financial move.
3. PayPal Protection
If you have a PayPal account, keep the balance low by transferring funds frequently to your bank account. You can also restrict access to reduce your risk.
4. Credit Card Control
If you use credit cards in your business, you’ll want to maintain tight control over them. For each employee or contractor that needs to charge items on a credit card, here are a couple of points to consider:
- If the credit limit on the current card is sky-high, then ask the bank to lower it or set up a new card with very low credit limits just for
employee use. - Contact your credit card company and get a card in the employee’s name.
- Make sure you can access the credit card transactions online. They are immediate, and if necessary, you can closely monitor what’s going on.
- Insist on a receipt brought to you for every purchase.
- Create clear procedures, limits, and approvals before the spending occurs.
- Don’t let the employee “keep” the credit card during off hours. Keep it locked up on your premises instead.
5. Safeguarding Payroll
One of the biggest cash outflows for small businesses is payroll. Here, segregation of duties comes into play again. The person preparing the payroll should not be the one who approves it and actually runs it.
You can do this by having different user accounts and controls within your payroll system.
Hopefully, you already have a lot of these ideas in place. If not, add the ideas you like to your to do list so that your business risks will be reduced.
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Tips & Tricks in QuickBooks®
