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Posts tagged bookkeeping
QuickBooks Simple Start……or STOP!
Jul 28th
Intuit used to make a product called QuickBooks Simple Start, which was a version of QuickBooks lower than QuickBooks Pro and less expensive. But sometimes less expensive means less valuable and meaningful. Even though Intuit has discontinued QuickBooks Simple Start, you can still purchase older versions online for about $60 or less, and on one site I found it was FREE! Buyer beware – you get what you pay for, right?
I recently had the pleasure of helping out a client clean up a QuickBooks file using QuickBooks Simple Start and showing the client to use additional features of the program. However, I was not happy with the lack of functionality of the program and do not recommend anyone to use it, even at free. The program is a very watered down version of QuickBooks Pro and is missing a lot of stuff (technical accounting term).
The Forward and Back Button – In QuickBooks Pro if you are entering an invoice, a sales receipt, a journal entry, or making a deposit there are these two arrows that let you scroll forward and backward to see transactions you have already entered. QuickBooks Simple Start does not have these arrows! So if you make an entry, press save and new, and go ooops – I forgot to add something to that invoice, you cannot press the back button to edit the transaction. Instead, in QuickBooks Simple Start you have to click on a button for a “list” and find the transaction.
Preferences – There is a preference menu item in QuickBooks Simple Start, but it has about 5 or less items to choose from. You cannot turn on class tracking. You cannot tell the program to use account numbers. You cannot set a preference on reports to be cash or accrual basis or to refresh automatically when you make a change. You cannot edit the email message that is sent out with invoices and statements. You cannot change the default date for entering new transactions. You cannot set the program to automatically recall the last transaction for the name. You cannot set a password to “close” your books. There are no options for finance charges. And you cannot change the default account “undeposited funds” when receiving customer payments which forces you to always go into the banking – make deposit screen even to make a single receipt!
Reports – You can generate a Profit & Loss statement and Balance Sheet in QuickBooks Simple Start like in QuickBooks Pro, but the Balance Sheet report in Simple Start is summarized. For example, instead of seeing each individual chart of account line item on the report, some accounts are combined. There may be a name that says Other Assets, but it consists of undeposited funds, credit cards, and loans. You have to double-click on the dollar amount to obtain the details. The same is true with the equity accounts. Let’s say you have two or more partners, you cannot easily see how much each partner withdrew or contributed during the year because the program combines the accounts. Again, you have to double-click on the dollar amount to see the detail. So you would have to create several reports for your tax preparer which would increase tax preparation time and money!
Bank Reconciliations – If you want to reconcile your bank statement, there is no menu Banking – Reconcile in QuickBooks Simple Start. Instead, you have to use a menu that takes you to For Accountant – Reconcile. So is this program inferring that you, the business owner, cannot reconcile your own bank statement and that it can only be performed by an accountant? I found that menu odd, maybe event a bit insulting to a business owner.
Those are just a few limitations I found with QuickBooks Simple Start when compared to QuickBooks Pro. My professional recommendation is to never use QuickBooks Simple Start and start with QuickBooks Pro.
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Neat Features of Peachtree Complete Accounting
Jul 17th
QuickBooks is not the only accounting software package out there for small business owners. Another choice people have is a program called Peachtree Complete Accounting. Here are some neat features of the program:
Memorized Transactions – if you use an outside payroll service, this feature is a time saver. Usually payroll generated from an outside firm is entered as a journal entry and there are several accounts to post to such as wages, FICA withheld, Federal Tax withheld, State Tax withheld, garnishments withheld, retirement withheld, and checking account. If you do not use a memorized journal entry to enter your payroll, then each time you have to remember which accounts to use. However, a memorized journal entry that is created can be used as a template ~ the accounts will already be there and you just have to update the dollar amounts and description (such as payroll w/e 3/15/2011). You can set-up a memorized journal entry to enter your payroll and then another one to enter your payroll taxes.
You can also memorize invoices. For example, if a customer is invoiced $150 per month for lawn maintenance services, then you memorize the invoice once and then use it as a template to enter in subsequent months.
Another type of transaction you can memorize is payments. Let’s say you pay $1,200 in rent each month. You can memorize the payment, select it, and then print the check or assign a manual check number to the transaction. You can also memorize payments such as automatic withdrawals from your checking account that are the same each month.
Memorized transactions save you time and aggravation.
Very Specific User Access – Peachtree allows you to set-up users with very limited or broad access to areas of the program. There are 7 different areas to restrict access to: Business Status, Customers & Sales, Vendors & Purchases, Inventory & Services, Employees & Payroll, Banking & General Ledger, and Company. For example, if you want an employee only to have access to Customers & Sales, you set the other areas to no access. Within the Customers & Sales area you could further restrict access to only allow the person to maintain the customer list but not be able to have access to credit card information, create invoices, or create customer reports.
Report Snapshot Screens – The Customers and Vendors have a management tab to quickly show you the activity of a specific customer or vendor on one screen. For example, if you choose a customer, you can see all the invoices, receipts, credit memos and account totals for a specific period of time. If you choose a vendor, you can see all the purchase orders, payments, item purchase history, and totals for a specific period of time.
If you have liked this blog, find out more tips by following EverChange, LLC on twitter (@EverChangeLLC), “like” EverChange, LLC on Facebook or sign up for the EverChange, LLC newsletter.
Clothes Hound – Grand Opening!
Jun 24th
I met Bryce at the Greater Raleigh Chamber of Commerce speed networking event. She was looking for a person that could help her with her POS system. At the event she handed out flyers of her grand opening event, but the occasion slipped my mind.
Wednesday night at the Greater Raleigh Chamber of Commerce after hours event at Lennar, Kim Niskey (great person to talk to if you want to join the chamber) gave me another grand opening brochure so I decided to check the place out.
Clothes Hound used to be an online boutique store to purchase hard-to-find, yet affordable, celebrity-driven brands of fashion but now it has opened its first store in north Raleigh. The store offers a selection of clothing and jewelry in the price range of $20 to $150. It even sells fashionable doggie collars, doggie bows, and cupcake squeeky dog toys. 10% of the sales proceeds from now until Saturday will be donated to the SPCA of Wake County.
At the ribbon cutting ceremony, people could enjoy white wine, cookies in the shape of dresses w/ pearl necklaces, cupcakes topped off with a high heel shoe, fancy sandwiches and salads and take home a unique bag full of goodies. Reusing this bag gives you 10% off your purchases.
I am not a huge clothes shopper, especially for dresses, but I found a really cute and affordable dress that I bought as well as a nice orange spandex t-shirt.
Check out the Clothes Hound at its new location in Raleigh: 8111 Creedmoor Rd., Suite 149, Raleigh, NC 27613 or shop online at www.shopclotheshound.com.
QuickBooks – For Real Estate Transactions
May 17th
QuickBooks is a very useful accounting software program used by many small business owners. If you own rental real estate property or have a business buying & selling real estate you may have wondered if QuickBooks would help you. Here are some ways that QuickBooks can benefit you if you are in the Real Estate industry:
Class Tracking – QuickBooks Pro has a feature called class tracking that can be turned on in the preferences section of the program. Class tracking allows you to tag income and expense items to a specific class, which in your case would be properties. For example, you could name the class using the street of your rental property or piece of property you want to sell. One class may be called 123 Main Street while the other may be called 45672 Pearl Street.
By using class tracking you can easily view reports that show the net profit of each individual property. For rental properties you can see which houses are generating the most money. For resale property you can see which ones yielded the biggest profits. You can also use the reports to determine where the biggest costs are for your rental properties and use the reports to determine if you want to keep the house as a rental unit or sell it.
Class tracking reports also save you time & money during tax season because it makes completing Schedule E a breeze for tax preparers.
Automated Invoicing – In QuickBooks you can set-up an invoice to automatically enter itself each month for each tenant so you can keep track of who owes you money. For example, if John Smith’s rent is $975 each month, you only have to create an invoice one time. Then you “memorize” the invoice and have it enter itself automatically each month on the first of the month. By automating your invoice process you will not have to wonder if you have invoiced all of your tenants. Invoices can also be emailed out in a batch once they are created.
Template for Selling Properties – You can set-up a journal entry template to use each time you sell a house in order to keep track of the gain or loss you made on the sale of the property. First you would “memorize” the transaction (but you would not enter it in automatically like invoicing). Later you would use the “memorized” transaction, changing the dollar amounts of the chart of account line items and the class (property name). Having the chart of accounts already set-up in the journal entry makes recording the transaction a lot easier, accurate, and consistent than if you recorded the transaction from scratch for each sale.
Pass Costs Onto Tenant – If you pay the utility bills for the rental units you can have your tenants reimburse you the costs. For example, let’s say you paid $500 for an electric bill on 123 Main Street and have two tenants. You want to charge $250 to tenant Bill and $250 to tenant Amy. When you enter the bill or write the check, you split the transaction and tag $250 to each tenant. In the bill or check, make sure there is a checkmark in the billable column. You can then modify the invoice that was automtically created by pressing the Add Time/Costs button on the invoice screen and selecting the cost to be reimbursed.
Those are just a few ways that QuickBooks could help if you work in the Real Estate industry.
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QuickBooks – for the PC or for the Mac?
May 10th
I have read reviews on the Intuit Online Community about frustrations of using the Mac version instead of the PC version. One post, which I agree with, stated that for the same price of product the programs should do exactly the same functions. So what are some of the differences between the PC version and the Mac version?
For starters, some of the menu options are different. For example, to turn on class tracking in the PC version you goto Preferences, but in the Mac version you go to Company Settings.
Payroll – for the PC version payroll is well integrated into QuickBooks, however, for the Mac payroll is online, you have to print PDF’s to print checks, and you have to import the transactions.
Collection center – this feature, that helps you track the monies owed to you by customers, is not available in the Mac version.
Batch invoicing – invoicing multiple customers at the same time is only available in the PC version.
QuickBooks search – this search feature is not available in the Mac version.
Scanning & depositing checks – this subscription feature which allows you to scan and deposit your checks into your bank account is only available in the PC version.
Multiple currencies – this feature, to invoice customers in different countries in non-US dollars, is not available in the Mac version.
Customer snapshot – and this feature, that captures key customer information in one place, is only available in the PC version.
There are more differences between the Mac version and the PC premier version. So, before you make your purchase decision, determine what your needs are or contact a Certified Intuit ProAdvisor for assistance.
I filed my taxes, so I don’t have to do anymore bookkeeping for a while, right?
Apr 24th
Wrong! One of the purposes of keeping your accounting records in order is to file taxes. But that’s not the only reason or the most important reason to keep your books up-to-date.
One reason why you should not relax and let your accounting slide now is so that you know the financial stability of your company. Now you can use previous years’ data and look at trends so you can plan for this year. For example, which months produced the most income and why? Which months produced the least amount of income? For those months you need to be prepared and have cash on hand.
This would be a great time to set-up a budget so that when your sales are up, you can save money for when sales are down. Also, analyze why your sales go down. Did you go to less networking events? Did you change your marketing strategy? Are there other factors out of your control that made your sales go down?
Another reason to keep your accounting current is to calculate your quartely estimated taxes due. If you’re self-employed you have to make quarterly estimated tax payments. Some people think that as long as they pay the tax in full on April 15th they are OK, but they are not. You can receive stiff penalties and interest for not paying your taxes throughout the year.
A third reason to keep your books up-to-date is for financing. What if you get stuck this year and need a loan? You want to be able to present fair and accurate financial statements to a bank. And trust me, a lender can tell when you haven’t kept your books up-to-date and have a mess on your hands. That would not help you secure a loan.
If you have liked this blog, find out more tips by following EverChange, LLC on twitter (@EverChangeLLC), “like” EverChange, LLC on Facebook or sign up for the EverChange, LLC newsletter.
How Do I Pay Sales Tax in QuickBooks?
Apr 11th
Paying sales tax using QuickBooks can turn into a mess if you do not use the right screen to pay for sales tax.
To start, how is sales tax calculated in QuickBooks? QuickBooks can calculate the sales tax owed using the cash (when the money is received) or accrual (when the customer is invoiced) method. You can use either method with the State of North Carolina, but you have to be consistent. For example, if you started with the accrual method you have to continue to use the accrual method. If you want to switch to the cash method, you have to contact the NC Dept. of Revenue which will first audit your sales taxes paid before allowing you to switch sales tax payment methods.
In order for QuickBooks to properly calculate sales tax, you have to use either the Customers – Enter Sales Receipt screen or the Customers – Create Invoices (and later Receive Payments) screen. If you record your sales by only making a bank deposit, the sales tax will not calculate for you and the sales tax reports will not be useful to you.
When you are ready to pay your sales tax, whether you file on a monthly, quarterly, or annual basis, there is a report that you can generate to see what is due. From the main menu bar, click Reports – Vendor & Payables – Sales Tax Liability. Be careful which dates you choose because that effects how much sales tax is due. After choosing the right dates, the amount due will show up on the last column of the report with a heading such as “Sales Tax Payable as of April 30, 2011″.
Next, make sure this amount equals the following screen: click on Vendors – Sales Tax – Pay Sales Tax. Again, be careful with the dates. For example, if you are paying sales taxes owed for April, make sure the date under “Show sales tax due through” is 4/30/2011. The amount due in this screen must match the Sales Tax Payable report previously generated. When the amounts match, put a check mark next to the tax agency you want to pay and press the OK button.
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EverChange, LLC ~ Forever Changing Your Business in an Ever-Changing Business Environment!
Should I Use QuickBooks Online?
Apr 4th
One of the best advantages of using QuickBooks Online is that you can access the program from anywhere in the world that has Internet access. However, the Basic program (currently $12.95 / month subscription fee) may not fit your business. Also, you cannot work on QuickBooks Online when the server is down, which has happened to me at a client’s location twice.
No Recurring Transactions – A great feature of the QuickBooks Pro desktop version is the ability to set-up recurring, or memorized, transactions that can be used as a template or enter themselves automatically. For example, you could set-up a payroll journal entry that has all the accounts set-up for you and you just change the dollar amounts for the current payroll cycle. Or, you could use the feature to enter in a rent bill each month automatically. You could also use the feature to automatically enter invoices for customers who owe the same amount of money each month. Recurring billing is available on the QuickBooks Online Essentials version, but that costs $24.95 / month ($299.40 per year, but you can buy the desktop version for $229.95 and use it for a few years).
No Class Tracking – Another great feature of the QuickBooks Pro desktop version is called class tracking. Class tracking allows you to tag income and expense items to specific locations, such as property ABC for a rental company, or to grants for a non-profit agency to track net monies left in grant pools. Unfortunately, the QuickBooks Online Basic version does not have class tracking. Instead, you have to use the QuickBooks Online Plus version which costs $39.95 / month ($479.40 per year. Ouch!).
No Progress Invoicing – This feature allows a user to create an estimate and then invoice a partial amount for the invoice. For example, let’s say your business has a policy of collecting 1/2 of the money up front and 1/2 of the money upon receipt of service. You would create an estimate in QuickBooks Pro and then make a progress invoice for 50% of the estimate. That way the customer sees the total amount agreed up and the amount currently invoiced and due. Estimates cannot be created and progress invoicing does not exist in the QuickBooks Online Basic version.
No Inventory Tracking – Only the QuickBooks Online Plus contains inventory tracking. Again, the price is $479.40 per year for that version compared to the QuickBooks Pro edition for $229.95 per year which could last up to three years worth of usage. If you buy the desktop version now through www.intuit.com when it is on sale, the cost is only $183.95.
Those are just a few examples of the differences between the QuickBooks Online editions and QuickBooks Pro desktop edition. To really know if Quickbooks Online is right for you, seek out a QuickBooks Pro Advisor(r) and discuss your needs with the advisor.
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Do You See Similar Businesses as Competitors or Business Partners?
Feb 26th
My guess is that most people view similar businesses as competitors and this should not be the case, in my opinion. Instead, similar businesses should work together and share ideas in order to help each other’s entity grow.
When I had my business in Michigan, I trained an intern how to use QuickBooks so that she could start her own business. My mother thought I was crazy, asking “why would you want to share your secrets with someone else?” But I did not see the woman as my competitor. I was eager to share my QuickBooks and accounting knowledge with someone else, especially since she lived much further away from me. I figured she would be able to serve a population that I would have little interest serving because of the travel time, and why not give the client the best service possible indirectly through my tutoring?
Here in North Carolina is the same case. There are many QuickBooks consulting firms in the area, but different clients fit with different firms so there is not really competition. New businesses form often and there is plenty of business to go around. One woman, Christine Kelly of netWorth Bookkeeping services, is based out of Fuquay-Varina. Although she offers the same or more services than I do, we do not view each other as competitors. Some of our service areas do overlap, but for the most part we service other areas.
The benefit of us seeing each other as business partners is that we share a lot of information with each other to help each business grow. For example, we are often chatting on inside919 in the instant message system or through Facebook. I have referred clients to her and for me she provides invaluable information. For example, she taught me how to get listed on Google places for free and how to use a free service called Mail Chimp to send out newsletters to people. I also watch how she tries to grow her business and think she’s a marketing guru. Then I ask her how each marketing technique works so I can evaluate if I will try it or not.
Overall, we have a great working relationship and we keep helping each other learn how to be a better business person instead of closing our doors and not sharing any information.
I hope that through networking events, and the blogs we write, and advertising we give each other helps to serve as an example to other similar businesses to share their efforts to help each other grow.
No W-9 Yet and Form 1096 is Due Feb. 28th?
Feb 17th
First of all, don’t panic. If you sent out a Form W-9 requesting a taxpayer ID so you could issue a 1099 but haven’t received one back, send it again. Each time you send out a Form W-9 keep a log so you can prove to the IRS that you tried to obtain a tax ID number from an individual or business.
Should you issue a 1099 without a tax ID number? Yes! According to a conversation I had with IRS representative 0705420, you still have to issue the 1099. What will happen is that the IRS, in the spring or fall, will send a notice stating that your information return is incomplete. If you have obtained the Form W-9 from the person by the time you receive the notice, you do not have to do anything. However, if you receive a penalty, you can try to get the penalty waived under Regulation 301.6724-1. As long as you have the evidence to show the efforts you made to obtain the tax ID number, you should be fine.
You can also file for a 30-day extension to file the information returns by completing Form 8809.
For more information, visit the IRS website at www.irs.gov. You can also read Publication 1281 which talks about bakup withholding if you do not receive a Form W-9.
