New Business Direction LLCThere are a lot of clues that indicate trouble with your QuickBooks company file. Is it time for a check-up and tune-up?
After this ridiculously long winter, you’ll probably hear few complaints about things like puddles in the street, summer heat and spring cleaning. Most people are eager to throw open the doors and windows, and attack the dirt that the season left behind, both inside and outside of the house.
It’s not hard to see when your home is dirty. QuickBooks company file errors are harder to detect, but they’re there, including:
- Performance problems
- Inability to execute specific processes, like upgrading
- Occasional program crashes
- Missing data (accounts, names, etc.)
- Refusal to complete transactions, and
- Mistakes in reports.
Figure 1: If some transactions won’t go through when you click one of the Save buttons – or worse, QuickBooks shuts down — you may have a corrupted company file.Call for Help
The best thing you can do if you notice problems like this cropping up in QuickBooks – especially if you’re experiencing multiple ones – is to contact us. We understand the file structure of QuickBooks company data, and we have access to tools that you don’t. We can analyze your file and take steps to correct the problem(s).
One of the reasons QuickBooks files get corrupt is simply because they grow too big. That’s either a sign of your company’s success or of a lack of periodic maintenance that you can do yourself. QuickBooks contains some built-in tools that you can run occasionally to minimize your file size.
One thing you can do on your own is to rid QuickBooks of old, unneeded data. The software contains a Condense Data utility that can do this automatically. But just because QuickBooks offers a tool doesn’t mean that you should use it on your own.
A Risky Utility
The program’s documentation for this utility contains a list of warnings and preparation steps a mile long.
We recommend that you do not use this tool. Same goes for Verify Data and Rebuild Data in the Utilities menu. If you lose a significant amount of company data, you can also lose your company file. It’s happened to numerous businesses.
Be Proactive
Instead, start practicing good preventive medicine to keep your QuickBooks company file healthy. Once a month or so, perhaps at the same time you reconcile your bank accounts, do a manual check of your major Lists.
Run the Account Listing report (Lists | Chart of Accounts | Reports | Account Listing). Are all of your bank accounts still active? Do you see accounts that you no longer used or which duplicate each other? Don’t try to “fix” the Chart of Accounts on your own. Let us help.
Figure 3: You might run this report periodically to see if it can be abbreviated.
Be very careful here, but if there are Customers and Vendors that have been off your radar for a long time, consider removing them – once you’re sure your interaction with them is history. Same goes for Items and Jobs. Go through the other lists in this menu with a critical but conservative eye. If there’s any doubt, leave them there.
A Few Alternatives
There are other options. Your copy of QuickBooks may be misbehaving because it’s unable to handle the depth and complexity of your company. It may be time to upgrade. If you’re using QuickBooks Pro, consider a move up to Premier. And if Premier isn’t cutting it anymore, consider QuickBooks Enterprise Solutions.
There’s cost involved, of course, but you may already be losing money by losing time because of your version’s limitations. All editions of QuickBooks look and work similarly, so your learning curve will be minimal.
Also, try to minimize the number of open windows that are active in QuickBooks. That will improve your performance. And what about your hardware? Is it getting a little long in the tooth? At least consider adding memory, but PCs are cheap these days. If you’re having problems with many of your applications, it may be time for an upgrade.
A Stitch in Time…
We’ve suggested many times here that you contact us for help with your spring cleanup. While that may seem self-serving, remember that it takes us a lot less time and money to take preventive steps with your QuickBooks company file than to troubleshoot a broken one.
Increasing your income is good. But even if you can’t, you can still take steps to collect the money you’re already owed faster. Here are five ways. 
If you asked five small business owners to name the top three roadblocks they face in their quest for ongoing profitability, it’s likely that all five would point to slow payments.
It’s everyone’s problem. Accounts receivable requires constant monitoring. As satisfying as it can be to dispatch a group of invoices, you know that it’s going to take some work to bring in payment for at least some of them.
By using QuickBooks’ tools and complying with accounting best practices, you’ll be more confident during the invoicing stage that what you’re owed will actually be in your bank account in a reasonable amount of time. Here are five things that we suggest.
Let Customers Pay Invoices Electronically
A few years ago, this was a good idea. In 2014, when people have stopped carrying checkbooks and are accustomed to using their mobile devices to pay for merchandise, it’s become almost required. Whether or not you know it, you’re probably losing some business if you don’t have a merchant account that supports credit and debit card payments, and possibly e-checks.
If you have an online storefront, you’ve undoubtedly been accepting plastic for a long time now. Not many shoppers want to place an order on a website and hunt for envelopes and stamps and blank checks to complete it. If you invoice customers, it’s just as critical that you allow them to remit payment as soon as possible.
Not set up with a merchant account yet? We can help you get started with the Intuit Payment Network.
Keep a Close Watch on your A/R Reports
Part of being proactive with your accounts receivable is being vigilant and informed. Create and customize A/R reports regularly. When you customize your A/R Aging Detail report, for example, in addition to the other columns that you include, be sure that Terms, Due Date, Bill Date, Aging and Open Balance are turned on (click Customize Report | Display and click in front of each column label).
You should also be looking at Open Invoices and Collections Report frequently, or assigning someone else to monitor them closely. We can help here by creating more complex financial reports periodically, like Statement of Cash Flows.
Send Statements
Invoices are generally the preferred way to bill your customers, but you should consider sending statements when customers have outstanding balances past a certain date. QuickBooks sometimes calls these reminder statements. You’re not providing the recipients with any new information; you’re simply sending a kind of report that lists all invoices sent, credit memos and payment received.
To generate statements, click Customers | Create Statements. You’ll see the window pictured above. You can send statements to everyone, a defined group or one customer, and you can define the past-due status that you want to target in addition to other options.
Send Accurate Invoices the First Time
Few things will slow down your accounts receivable more than incorrect invoices. The customer can wait until payment is almost due to dispute the charges, which means that they’ll probably get another 15 or 30 days (or whatever their terms are) to pay the amended bill.
So whoever is responsible for creating invoices needs to be checking and re-checking them. If it’s logistically possible, and depending on your workflow, have them verified by a second employee.
Offer Discounts for Early Payment and Assess Finance Charges
Offering discounts is a balancing act. You’ll be getting less money for your sale – even 5 percent multiplied by many customers can add up – but it may make sense financially for you to take a small hit in return for being able to deposit the payment sooner. We can help you do the math here.
To offer this, you’ll have to set up your discount scenario as a Term option (Lists | Customer & Vendor Profile Lists | Terms List), as seen here:
To make a customer eligible for the discount, open the Customer Center and double-click on a customer, then on Payment Settings| Payment Terms.
You might also want to be assessing finance charges. The revenue you bring in from finance charges will probably be negligible. But sometimes, just knowing that a late payment will be more costly may prompt your customers to settle up in a timely fashion.
Whatever approaches you choose to accelerate your receivables, be consistent. If any of your customers should compare notes, you want to be regarded as being firm but fair.
Have you ever called a help line and at the end of the call had a bigger problem than before you called? Unfortunately, it’s not uncommon.
Navigating the help line process can be a challenge for anyone’s patience. Here are a couple of tips you can try to make the process a little less painful.
Repeat Business
If you get someone that does a good job of solving your problem, ask them if you can contact them directly. You will begin to establish a rapport, and you’ll have an inside ally you can turn to. They’ll also begin to know your issues, the product you’re calling about, and how you use it.
Fly First Class
Sometimes, it’s just worth it to pay for a higher level of access. You can check that out yourself, or you may have expert vendors you can tap to access their higher-level resources. By paying for a higher level of service, you can get priority service and access to more highly trained personnel.
Learn the Language
How you communicate your request to the help line personnel can make all the difference in the world when it comes to saving time. To speed up the process, have the following things handy:
- If an error message is involved, take a screen print or write down the exact wording or error code, if any.
- If software is involved, be ready to let your technician know the operating system you’re on, what browser you’re using if the Internet is relevant, and other details that will isolate the problem.
- If software is involved, they may ask you what version you have. You can find that by choosing File, Help from the menu, or they can walk you through it.
Call Off-Peak
For shorter wait times, try to call when no one else in calling. For hardware and software support, this may mean avoiding Mondays and rush hours. For questions to the IRS, it may mean calling earlier in the season.
Hire an Expert
Some of your vendors (including us!) may have access to a higher level of support based on their connection with the company. For example, certain QuickBooks ProAdvisors have access to an elite group of support technicians and get priority services as well. Accountants have a special line in to the IRS. Fortunately here at New Business Directions, we have both.
You may be able to save money and especially time by delegating these help line calls to those privileged vendors. (And if we can help save you time and frustration in this area, please let us know.)
You may not have even completed your 2013 taxes yet. But now is an ideal time to start getting ready for your 2014 returns.
We know that you’re in some stage of preparation for your 2013 income taxes. It may seem odd to start thinking about 2014 taxes just now, but actually, this is the ideal time to start planning and making business decisions with their tax implications always in the back of your mind.
As you look at the data that will be entered in your 2013 tax forms, you’re likely to come across some expenses that you might have handled differently, or some income that should have been deferred. If you begin your planning process for 2014 while 2013 is still in the works, you can start making smarter, more tax-advantageous business decisions now, instead of late in the year when everyone is rushing to take actions necessary to lower their tax obligation.
Here’s how QuickBooks can help you with this new approach.
Overhaul your Chart of Accounts
The mechanics of doing this in QuickBooks are fairly uncomplicated, but changing this critical list – the backbone of your company file – requires solid knowledge of which accounts should be added, deleted or changed. You also need to know which accounts and subaccounts will have impact on your income taxes. They must be structured accordingly.
Figure 1: QuickBooks’ default Chart of Accounts can be easily modified to meet your company’s unique needs. But let us help you with this task.
For these reasons, we ask that you consult with us if you think your Chart of Accounts could use an overhaul. Our early involvement will be much more economical for you than if we have to come in down the road when your accounts have become dangerously tangled.
Devise an Effective System for Estimated Taxes
As you well know, there’s no magical formula for estimating how much income tax you’ll owe when all of your income and expenses have been tallied. We can make this an ongoing task by creating monthly or quarterly financial reports for your business and working from those.
If you’re self-employed, you might want to open a low-fee checking account that will serve solely as your tax fund. Because you have no employer to pay a portion of your Social Security and Medicare obligations, it’s critical that you’re putting enough away. Consider putting one-third of your taxable income into that account and see how it goes. You may get a pleasant surprise at tax prep time, or you may have to dip into other savings to be compliant.
Figure 2: You may want to set up a separate bank account to park estimated tax funds, so you know they’re committed. Ask us about numbering new accounts.
You can submit federal payments online on the Electronic Federal Tax Payment System site. Check with us to see if your state has an electronic system. Of course, the IRS will accept a check.
Run Reports on Everything. And Keep Running Them.
We already mentioned that we’re happy to create and analyze your most critical financial reports on a regular basis. You may have tried to understand the Trial Balance, Statement of Cash Flows, etc. in QuickBooks and been puzzled. Don’t feel incompetent because of that: It often takes an accountant-level individual to understand what they mean for your business.
You can define and build your own reports using QuickBooks’ customization tools. If you have employees who travel, consider bringing in an automated expense report application (we can help you find one and implement it). Stress the importance of adhering to IRS rules about travel. Same goes for your local salesforce, off-site technicians and other service providers, etc.
For employees who come into the office every day or are telecommuting, you can give them some ownership of their contribution to expenses by bringing them into the budget process and/or requesting that they submit their own monthly mini-reports on any company funds they spend. The more employees are aware of and accountable for expenses, the easier it will be for you to work toward minimizing your tax obligation. And having some information about the considerable sum you pay in taxes may help staff understand your tightening of the purse strings.
Consider Retraining Bookkeeping Staff if Necessary
You may be paying a portion of your taxes unnecessarily, simply because your company’s bookkeeping is less-than-precise. Nip that in the bud.
The more you manage your reporting, stay aware of the consequences of every expenditure and bring employees into the process, the more prepared you’ll be for 2014 taxes.
Have you ever tried on a shirt or jeans and found they didn’t fit at all? 
They looked great on the hanger, but that was the end of it. Accounting systems come in all sizes, shapes, and colors just like clothing; and just like clothing, some accounting systems fit your business better than others. It’s not that easy to spot in a mirror when an accounting system does not fit a business, but there are other signs that will give it away. Here are five of them:
Numerous Workarounds
A workaround happens when your current system cannot do all the things you need it to do. A workaround can take the form of a spreadsheet, a report, a program, or a database that is created with extra time spent every month so you can get the information out of your system and manipulate it the way you need it to run your business. 
Since no accounting system is a perfect fit for any one business, it’s normal to have some workarounds in place to meet your unique business needs. If you have too many workarounds, and it feels like patchwork, it might signal that you’ve outgrown your current system and need to find an accounting system that provides you with more functionality.
Downtime or Wasted Time
If you are unable to access your system when you need to do your job, then you are experiencing downtime in one form or another. You may be waiting for a file to be fixed, or the system may actually be down. If your system runs slowly, then that’s another form of downtime that wastes your time. If you have to take time to make backups and perform restorations, this type of activity does not add value to running your business. When you have too many of these time-wasters, it could be time to look for a better way.
Old Technology
If your accounting system is more than about three years old and you’ve chosen not to update it, then you may be missing out on newer time-saving features that could help you reduce the amount of time you spend doing your accounting. If your accounting system is more than six or seven years old, then you are definitely losing productivity. It’s time to bite the bullet and learn a new system so you can experience better profit margins in your business.
Limited Users or Security
If your current accounting system does not provide you with enough users, then you might have more expensive employees doing lower level jobs, which is costing you more in payroll expenses. 
You may also need certain user permissions to be more granular than they are in your current system as you grant access to certain parts of the system to different users. If you’re on QuickBooks, that’s a really easy fix, so please talk to us about this.
We find that user access is a hot button with a lot of business owners, so if it’s true for you, please reach out and let’s have a conversation about this.
Limited Physical Access
If your accounting system is located on a private PC or server in your business, this limits access to your files. If you have more than one business location, you like to work from home, or your employees work from their homes occasionally, then you may want to look for a system that accommodates “anywhere, anytime” accounting. This is a pretty easy fix too, as this requirement is now quite common with business owners today.
The same can be said for mobile access. New apps enable many accounting features to be completed from your mobile phone, such as checking bank balances, approving a bill, and taking a picture of a receipt and uploading it, to name a few. If you want to do you accounting from your mobile phone, ask us about mobile apps that we can link to your system to enable this functionality.
Boosting Your Accounting Productivity
We might be a little biased, but accounting has gotten to be a lot more fun in the last few years with advancements in technology. If you see any of the signs listed above, it might be worth a conversation to see if your accounting system is the best fit for your business. Just reach out anytime.
Many small business owners focus on 
generating more revenue every year, and that’s a great objective. But not all revenue is created equally. If you sell more than one product or service in your business, then you can benefit from looking at your revenue mix.
Although it’s fun to watch our revenues grow, it’s the profit number that really matters. If your expenses grow faster than your profits, then you have a lot of activity going on, but you don’t get to keep as much of what you make, which is what really matters.
An insightful exercise to try is to take a look at your revenue mix. Then you can ask “what if?” to optimize your profits.
Your Revenue Mix
Let’s say you offer three different services: Services X, Y, and Z. Your revenue pie looks like this:
X: $1.4 million or 70% of the total
Y: $0.3 million or 15% of the total
Z: $0.3 million or 15% of the total
Total: $2.0 million
In this example, Service X is clearly the service making you the most revenue in your business. But is it making you the most profits?
The profit you receive from each of these service lines is as follows:
X: $160K
Y: $20K loss
Z: $60K
Total: $200K
While Service X is generating the most profit volume for your business, it’s actually Service Z that’s the most profitable. Earning $160K on $1.4 million yields 11.4% return on Service X, but earning $60K on $300K yields nearly double the return at 20%. Service Z generates the most return. And if possible, Service Y may need to be discontinued or turned around.
Optimizing Profits
Your strategy for a more optimum revenue mix might be to sell as much of Service Z as possible, while eliminating or fixing the problem around Service Y.
It’s fun to experiment with different revenue mixes. And of course, there are many more variables besides profit, such as:
Which service do you prefer to work on?- Are you able to sell more of the most profitable service or are there marketing limitations?
- Is one service a loss leader for the others?
- Are you able to adjust price on the lower margin services to increase your profits?
There are many more questions to ask and strategies to consider to make you more money, which is why we love our job!
A New Year, A New Mix
We hope you’ll spend some time analyzing your revenue mix and having fun asking yourself “what if?” If we can help you expedite the process or add our perspective, please reach out anytime.
With the holiday season just around the corner, it’s a perfect time to get your financial records in order. Tax moves you make now can mean finding more “green” to spend on family gifts and festivities. Here are five quick tips for you to feel more prepared about your financial status as you go into year-end.
1. Avoid Penalties
This time of year is ideal to double-check your tax payments, both federal and state, to make sure enough has been paid in, and even more important, to avoid overpaying so your money is not tied up unnecessarily. If you’re not sure of your 2013 tax liability, check with your tax preparer.
2. Balanced Books
Rather than wait until the busiest time of year for accountants and bookkeepers, you can get a head start now on catching up your books. You’ll have more of their attention and you may even avoid a rate increase if you get your books done early. Completed bank reconciliations are a very important part of catching up.
3. Forms
It’s not too early to get your orders in for the forms you need at year-end like your W-2s, W-3s, 1099s, and 1096s. That way, your forms will be onsite when you’re ready. If we do not process your year-end forms, you can order the forms you need online and save 20% using code PAPWBKC.
4. Records
Information that’s missing at the last minute can take up extra time and be costly. It’s a great idea to do an audit now of W-9s to grab missing addresses and tax ID numbers of your sub-contractors. Also do a scrub of your employee payroll records so that your W-2s will be complete and accurate.
5. New Tax Changes
Be sure to check with your advisors on new laws affecting individuals and businesses next year. One of the biggest ones making news is avoiding the fine involved regarding the new health care requirements for individuals. And there are many more you’ll want to get up to speed on so that you’ll know how they affect your situation.
We know it’s early to be talking about taxes, but we’re also all about saving you money and time. Try these five tips so you’ll have better peace of mind and be more prepared for year-end.
Greetings!
QuickBooks is easy to use, intuitive and flexible. But it is not an accounting manual or class or tutorial. If your business is exceptionally uncomplicated, you might get by without knowing a lot about the principles of bookkeeping.
Still, it helps to understand the basics. Here’s a look at some terms and phrases you should understand.
2. Accounts Payable (A/P). Everything that you owe to vendors, contractors, consultants, etc. is tracked in this account.
3. Accounts Receivable (A/R). This account tracks income that hasn’t been realized yet, like outstanding invoices.
4-5. Accrual Basis. This is one of two basic accounting methods. Using it, you record income as it is invoiced, not when it’s actually received, and you record expenses like bills when you receive them. Using the other method, Cash Basis, you would report income when you receive it and expenses when you pay the bills.
6-7 Asset. What physical items do you own that have value? This could be cash, office equipment and real estate. In QuickBooks you’ll be managing two types. Current Assets are generally used within 12 months (or you could convert them to cash in that length of time). Fixed Assets refers to belongings like vehicles, furniture and land, property that you probably won’t use up in a year and which usually depreciates in value. Depreciation is very complex; you may need our help with that.
8. Average Cost. This is the inventory costing method that programs like QuickBooks Pro and Premier use to calculate the value of your stock.
10-12. Double-Entry Accounting.This is the system that QuickBooks uses – that all legitimate small business accounting software uses. Every transaction must show where the funds came from and where they went. Each has a Credit (decreases asset and expense accounts) and Debit (decreases liability and income accounts) which must balance out (other types of accounts can be affected).13. Equity.This refers to your company’s net worth. It’s the difference between your assets and liabilities.
14. General Journal. QuickBooks handles this in the background, so it’s unlikely you’ll ever be exposed to it. We sometimes have to create General Journal Entries, transactions required for various reasons (errors, depreciation, etc.) that contain debits and credits. Please leave that to us.
15. Item Receipt. You’ll create these when you receive inventory from a vendor without a bill.
16. Job. QuickBooks often associates customers with multi-part projects that you’ve taken on, like a kitchen remodel.
17. Net income. This is your revenue minus expenses.
18. Non-Inventory Part. When you purchase an item but don’t sell it or you buy something and resell it immediately to a customer, this is what it’s called. It’s merchandise that isn’t stored by you for future sales.
19. Payroll Liabilities Account. QuickBooks tracks federal, state and local withholding taxes, as well as Social Security and Medicare obligations, that you’ve deducted from employees’ paychecks and will remit to the appropriate agencies.
20. Post.You won’t run into this term in QuickBooks. It simply refers to recording a transaction within one of your accounts.
21. Reconcile. QuickBooks helps you with this. It’s the process of making sure your records and those of your financial institutions agree.
22. Sales Receipt.This is how you record a sale when payment is made in full during the transaction.
23. Statement. You’ll generally use invoices to bill customers in QuickBooks, but you can also send statements, which contain transaction information for a given date range.
24. Trial Balance. This standard financial report tells you whether your debits and credits are in balance. Should you run this report and find a problem, let us know right away.
25. Vendor. With the exception of employees, QuickBooks uses this term to refer to anyone who you pay as a part of your business operations.
These are just a few of the terms you should recognize and understand. We hope you’ll contact us when you need help understanding how the accounting process fits into your workflow.
Greetings,
Knowing your vital signs, and especially when they are out of whack, is good for your health. In the same way, knowing your business’s vital signs, and especially when they are out of whack, is good for the financial health of your business.
If you’ve been in business a while, you might already know the “vitals” you like to track. Here are some common ones for a small or new business:
- Checking account balance(s)
- Cash flow requirements for bills and payroll
- Revenue for the month and year-to-date
- Sales by customer so you can see the top five to ten largest customers
As time goes on and your business grows, you may want to add some of the following:
- Revenue for the month and year-to-date compared to last year
- Net income for the month and year-to-date compared to last year
- Days Sales Outstanding which is a measure of how long it takes to collect on an invoice from a client
- Revenue by service or product line in a pie chart
What about these important metrics?
- Best and worst selling products
- Tracking promotion codes and coupon results
- Work in progress or backlog
- Number of days to fill an order
These are just a handful of the many options there are when it comes to measuring the results of your business, and it would be difficult for us to list all of them here. The point is to decide proactively what you would like to track on a monthly basis. Then you can set up the process it takes to get those numbers delivered to you in the format you prefer.
Once you decide on the numbers you need to run your business, you’ll be able to take your “vitals” whenever you want. You can take this to the next level with one more idea: exception reporting.
It’s great to glance at your numbers periodically, but there can be a lot of data to wade through. How about getting a report that tells you only when the numbers go out of range? This is called exception reporting, and requires that you set ranges for each measure you want to follow. If the measure stays within range, you do not have to be alerted. However, if it falls out of range, then you can get a report to tell you what’s going on so you can take the right business action.Exception reporting is not all that common in small business, but it should be. It can save a busy owner a lot of time.
By determining the vitals you want to watch for your business and putting a process in place to monitor that information, you will be helping your business stay healthy. If we can help, please reach out and let us know. The doctor is IN.
Phone: (603) 356-2914 | Fax: (603) 356-2915
Greetings!
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.
