QuickBooks Tip: Advanced Excel Options

You've undoubtedly created reports that were so lengthy that you got tired of scrolling up and down to find totals for each individual section. QuickBooks lets you collapse and expand reports to see primary totals only, but this command affects the entire report.

If you want to just collapse a section or two, here's how you do it. As an example, go to Reports | Company & Financial | Balance Sheet Standard. In QuickBooks 2012, you'd click the Excel button (your version may say Export). Indicate that you want to create a new worksheet and click Advanced. This window opens:

Figure 1: The Advanced Excel Options window displays the formatting tools you can carry over from QuickBooks and the features in Excel that you want to be active.

Make sure that )Auto Outline (allows collapsing/expanding) is checked, then click OK and start the export. When your report opens as an Excel spreadsheet, you'll notice that there is a series of vertical lines to the left of your data, and a group of numbers that corresponds to them running above horizontally.

Figure 2: Excel's Auto Outline feature adds tools to the left of your data that let you collapse and expand subsections.

To collapse a section so that only the totals show, click on the minus (-) sign next to the line that should remain (in this example, it's Total Checking/Savings). Do the same for Total Accounts Receivable and Total Other Current Assets. Then scroll down and do the same thing for the other asset subtotals. Here's what you'll see:

Figure 3: As you can see, the minus (-) signs have turned into plus (+) signs, which allows you to expand the rows back to their original states.

Auto Outline is a very useful feature, but there's more than one way to implement it. And its availability and operation can vary in different versions of both Excel and QuickBooks. We can help you master this, as well as other QuickBooks-to-Excel tools. Call us today!

Why It Pays To Hire Your Kids

Hiring your children not only prepares them for their future and allows you to spend more time with them, but it also offers significant tax advantages.

Having your kids as employees will be most beneficial if they are under the age of 18. The government assumes that you will take care of your underage children if they lose their jobs, so you will not be required to pay unemployment insurance premiums. For similar reasons, the federal government will not require you to pay taxes for Social Security or Medicare.

If your child works for you, you can also open an Individual Retirement Account on his or her behalf. Opening a traditional IRA allows your child to earn a larger income without paying taxes. Conversely, opening a Roth IRA allows your child to put money away into account that can be tapped without penalties in the future.

In order to claim any of these financial benefits, you must follow certain rules when you take your children on as employees. First of all, any work your children perform must be reasonable and necessary for the business. If you would usually pay someone else to perform a task your child is doing, the IRS will most likely consider it to be a valid job. Jobs must also be appropriate for your child's age. For example, you probably shouldn't hire your eight-year-old to program the computers in your office.

In order to hire your children legally, you must also pay them a wage that is consistent with the wage you would pay another employee to do the same work, and you must treat them like all other employees in your company. Make sure that you keep good records in case you are chosen for an audit.

Hiring your kids isn't always the right decision, but it can be rewarding if done correctly. Acting as your child's employer allows you to teach the child financial responsibility while simultaneously reaping tax benefits for your business.

QuickBooks Tip: Classes or Types? When to Use Them

QuickBooks' standard reports are critical to understanding your company's past, present, and future. But the program also offers innovative tools that can make them significantly more insightful and comprehensive.

QuickBooks offers two simple conventions that let you identify related data: classes and types. Classes are used in transactions. Types are assigned to individual customers, vendors, and jobs.

You might use classes to, for example, separate transactions that relate to different departments or locations or types of business. A construction company might want to track classes using New Construction, Remodel, and Overhead. Your customer types might help you isolate groups by characteristics like Industry or Geographical Location.

Creating Classes

First, make sure that QuickBooks is set up to use classes. Go to Edit | Preferences | Accounting | Company Preferences. Make sure that Use class tracking is checked. If you want to be prompted for a class designation in transactions, check that box, too. QuickBooks already contains a Type field in customer, vendor, and job records.

It's easy to build lists of options for both. To define classes, go to Lists | Class List. In the bottom left corner of the screen, click on Class, then select New from the menu. You'll see this:

Figure 1: To create a class, just give it a name and click OK.

Let's say that you're a contractor and you want to separate remodeling jobs into room types, like Bathroom or Kitchen. Go through the above steps again. Enter "Bathroom" in the Class Name field and click the box next to Subclass of. Open the list and choose "Remodel." Click OK.

Tip: If your class list grows lengthy and you want to tidy it up, you can make classes that you're not currently using inactive by checking the box in this window. It will remain in your QuickBooks records and can be reactivated again.

Putting Classes to Work

Now you can use classes in transactions. Open a blank invoice and select a customer. The Class field will be next to the customer name. If the entire invoice will be assigned to the same class, click the drop-down list and select it. You can also assign separate classes to individual line items:

Figure 2: You can assign different classes to individual line items in transactions.

Not all invoice templates include a column for classes. You can add this by selecting the invoice form you want to modify and clicking Customize in the toolbar.

QuickBooks comes with two reports specially designed for tracking class-based transactions: Profit & Loss by Class and Balance Sheet by Class (both can be found in the Reports menu, under Company & Financial). Of course, you can filter other reports to include a class column. You can also create a QuickReport for individual classes. Go to Lists | Class List and select a report or graph.

QuickBooks Tip: Customer Refunds...Are You Doing Them Right?

Refunds. You probably wince at the word. Some - like customer refunds for returns - are fairly uncomplicated, thanks to QuickBooks' tools. Others, not so much. You may find yourself unable to balance your accounts receivable. 

There are numerous scenarios that necessitate the use of credit memos, including overpayment, order cancellations and bad debt write-off. It's critical that these are entered correctly. If they aren't, you may lose a lot of the time that QuickBooks helped you save as you try to chase down a few dollars.

Figure 1: QuickBooks helps you identify refunds quickly.

Sending money back

Let's say a customer pays for an order but cancels before it ships. You could:

• Apply the balance to an existing invoice
• Keep it as an available credit 
• Issue a refund 

Click Customers | Create Credit Memos/Refunds. Select the correct customer and job (and A/R account, if you have more than one). Enter the items just as they appear on the invoice. When you're finished, click Save & New.  The Available Credit window opens, displaying your options:

Figure 2: The Available Credit window displays your credit balance options.

You would select Give a refund and click OK. The Issue a Refund window opens and should already be filled in. If everything is correct, click OK. The refund check has now been entered in the checking register, ready to be processed.

WARNING: If the invoice was paid with a credit card, it gets complicated. Your instructions will depend on whether you are using Intuit Merchant Service for QuickBooks or another merchant account service. You'll also have to deal with transaction fees. We can help you deal with this.

Other refund options

If the customer has open invoices, you may want to choose Apply to an invoice in the Available Credit window. A list opens;  just select the correct invoice. Or if you want to have those extra funds available for other invoices but don't want to apply them immediately, click Retain as an available credit.  When you want to use them, click the Apply Credits button in the lower right corner of the invoice. 

Figure 3: When issuing a refund, QuickBooks can hold those funds to be applied to invoices later.

Sometimes, customers overpay an invoice or statement charge, or make a down payment for which there is no invoice. This is easy to fix. Open the Customer Payment screen (Customer Center | Transactions | Received Payments) and double-click the related payment. In the screen's lower left corner, you'll see this:

Figure 4: Click the correct option here.

Click the correct button, then Save & Close. The Issue a Refund window opens; you'd treat it the same way you did when you dispatched a return refund.

Another use

You can also use credit memos to write off bad debt if you are using the accrual method of accounting. 

If you don't already have a Bad Debt item in your item list, set up a new item as an Other Charge. Name it "Bad Debt" and match it to the correct account.

Open the Credit Memo window and select the customer, then select Bad Debt as the item. You'll get a message saying that the item is associated with an expense account; click OK. Enter the write-off amount minus sales tax if taxable (be sure the Tax column is correct) and click Save & Close. 

WARNING: Enter two lines on the credit memo if it combines both taxable and non-taxable items (both charged to the Bad Debt account), one for each type. Be sure that the Tax Columns are correct.

The Available Credit window opens. Select Apply to an invoice. Put a check mark next to the correct one and click Done.

Make refunds make sense

It seemed easier in the days when you just wrote a check for a refund or made an entry in a paper ledger, didn't it? Using QuickBooks credit memos, though, helps you maintain records that follow standard accounting procedures and simplifies our understanding of your files. We'll be glad to help you make sure that this sometimes-complex task is done right from the start.

QuickBooks Tip: Make it Yours

No matter which version of QuickBooks you're using, there are always ways to make your workday easier. As with any software, we tend to learn the features we need and not much more. But small changes in the way you operate can add up to significant time savings and more accurate files. If you jumped into QuickBooks without a thorough introduction, consider these tips. 

Use the Open Window list

Spend some time in Preferences, and you'll be surprised to learn that you have more flexibility than you knew. QuickBooks is designed to work for a tremendously wide variety of businesses, so it comes with some features activated but many dormant. 

The Open Window list is a good example. Do you tire of closing windows to find a screen that you used several tasks ago? Make sure that you're in one-window view (View | One Window), and then click View | Open Window List. Click on any entry to move to that page.

Figure 1: The Open Windows list lets you easily move among active screens.

Make account assignment mandatory

QuickBooks lets you enter transactions without assigning them to accounts. So your Chart of Accounts has two accounts labeled Uncategorized Income and Uncategorized Expenses that serve as repositories for these transactions. This means that when you run reports or prepare for taxes, you may have a hard time remembering the circumstances of those transactions and will find it difficult to assign them to accounts.

Do yourself a favor. Set up QuickBooks so that you must assign an account to every transaction. This will take extra time upfront, but not as much as if you try to recall the transaction three months from now. Go to Edit | Preferences | Accounting | Company Preferences and make sure that Require Accounts is checked. If you have questions on this, please call or email us.

Use the Account Prefill fields

Speaking of accounts, here's a little time-saving tip. If you have vendors that are always assigned to the same account(s), you can establish this constant in the vendor record. Simply open the Edit Vendor window for a client and click the Account Prefill tab. Select the appropriate selection(s) from the drop-down lists. If a payment is sometimes split between multiple accounts, you'll handle this division when you add transactions. 

Figure 2: Designate vendor accounts to save time when creating transactions.

Use "Pending Sales"

Invoices, sales receipts and credit memos can be earmarked as "pending." These sales do not show up in registers or reports (except for the Pending Sales report) and can't be used for transactions where payment has already been applied. Create the transaction and click  Edit | Mark [form name] As Pending. To finalize it, open the form and click Edit | Mark [form name] As Final.

This action can be useful in multiple situations, including:

• Backordered items
• Draft approvals
• Estimates
• Time-tracking for jobs
• Profit and loss reports that show the impact of pending sales (choose Either as the posting status [Non-posting or Posting] under Filters)

Figure 3: You can mark a payment as "pending" in several situations.

Be kind to your accountant: Set a closing date 

Once we've worked with your QuickBooks file up to a certain date, entering, editing or deleting transactions prior to that date wreaks havoc with the balance of your books. To be safe, your administrator should password-protect the ability to do this, so that no one does this intentionally or unintentionally. Go to Edit | Preferences | Accounting | Company Preferences and enter a closing date and password. We will change the date each time we complete our work.

Figure 4: Password-protect closed periods to preserve the accuracy of your books.

These are just a few examples of ways you can customize QuickBooks to make your workdays more productive and your record-keeping safer and more reflective of your business. We can help you further tailor the software to make it a better fit.

If you have questions on this or any other QuickBooks feature, call or email us. We're your partner and we're here to make your business better.

QuickBooks 7-Point Inspection

Did you know most QuickBooks users only use about 40% of the features QuickBooks offers? Failing to take advantage of these features can drain your productivity, which can drain your wallet!

Here at Rikard & Neal CPAs, PLLC we have a solution to help you get the most out of QuickBooks. For a limited time, we are offering a free QuickBooks 7-Point Inspection.

A free QuickBooks 7-Point Inspection can help:

• Identify problem areas.
• Identify QuickBooks features that may be beneficial for your business to implement.
• Identify potential security issues.
• Identify time-wasters.
• Identify the reports to help you make sense of your finances.
• Identify areas where performance could be lagging.
• Make year-end tax planning much smoother.
• Save you money!

Please contact us today at 901-685-9411 for your free QuickBooks 7-Point Inspection.

QuickBooks Tip: Finding the Report You Need

For many busy business owners, QuickBooks is the go-to accounting software. QuickBooks has made entering invoices, bills, and all kinds of financial transactions as easy as can be, but how does a business owner analyze and make sense of all this data? If you know where to look in QuickBooks, you can find the report you need to answer the questions you have.

  

QuickBooks provides many preset reports that focus on all aspects of your business finances. These reports can answer many of your business questions, such as:

1. How much do my customers owe me?
2. How much do I owe my vendors?
3. Do I have enough cash?
4. Which parts of my business are profitable, and which are not?
5. And most importantly…Am I making money or am I losing money?

While QuickBooks preset reports can answer the questions mentioned above and so much more, how can you find the reports that are tailored to the needs of managing your business? The easiest way to find the report you need is to use the Report Center. In the Report Center, you can:

1. Browse through report categories and the related reports for each category.
2. View sample report images and report descriptions.
3. Create and access a list of your favorite reports.
4. Quickly access recently reviewed reports.
5. Search for reports based on words found in its title or description.

The Report Center is a central location for all your reports. From here, you can easily run reports that show all Open Invoices, Sales by Customer, or Sales by Rep, for example. You can even print several different reports all at once!

What is your favorite report? Post a comment and share it with everyone – thanks!