QUICKBOOKS BY INTUIT STUDENT VERSION ACCOUNTING SOFTWARE SUPPLEMENT FOR CHAPTER 1

Transcription

1 THE KNOWLEDGE BUREAU 2011 QUICKBOOKS BY INTUIT STUDENT VERSION ACCOUNTING SOFTWARE SUPPLEMENT FOR CHAPTER 1 COMMONALITIES OF BOOKKEEPING FOR VARIOUS BUSINESS ENTERPRISES OUR PRACTICAL GOAL: Here is what we are going to cover: Using the pre-configured charts of account provided with QuickBooks. Understanding the restrictions on deleting accounts. How to modify the chart of accounts. How to prepare a bank reconciliation. Using Existing Charts of Account QuickBooks comes with a series of pre-configured charts of account which have been created for a wide variety of business profiles. When a new enterprise is set up in QuickBooks, the user can choose to use one of these charts of accounts. 1

2 THE KNOWLEDGE BUREAU 2011 Choosing to Create a new company starts the process and activates the setup wizard and the following screen appears: QuickBooks provides an EasyStep Interview feature which allows the company to be set up quickly and easily by answering questions about the company. This interview can be exited at any time and information can be added or modified from outside of the interview. Click Start Interview and complete the screens of the wizard: 2

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4 THE KNOWLEDGE BUREAU 2011 Setting up the password is optional and can be modified at a later date. From the next screen onward, questions are answered specific to the business to determine the company settings used in the set up process: 4

5 THE KNOWLEDGE BUREAU 2011 Once your company has been created, you can turn on the account numbers by accessing the company preferences. From the Edit menu, choose Preferences and under Company Preferences in the accounting window, check the box to use account numbers. Restrictions on Deleting Accounts Although a user is given a great deal of flexibility in modifying accounts in a chart of accounts, there are restrictions on deleting accounts. These restrictions arise because an account cannot be deleted if it is referred to by a link to another 5

6 THE KNOWLEDGE BUREAU 2011 account or if it includes historical financial information that QuickBooks needs to process transactions or produce financial statements. Use the Help function to search for Deleting Accounts. Depending on the version of QuickBooks you are using, you will see something like: Modifying the Chart of Accounts Steps to modify the chart of accounts: 1. Open the Chart of Accounts window from the List menu. 6

7 THE KNOWLEDGE BUREAU 2011 Options for adding, modifying, and deleting accounts can be found clicking the Accounts button at the bottom left corner of the screen. 2. To modify an existing account or create a new account, enter the information in the following fields: Account number and name Account type Add or remove subaccount designation Tax line mapping Change opening balance Inactive or active account Description of the account 7

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9 THE KNOWLEDGE BUREAU 2011 Liability Account Types QuickBooks refers to the liabilities account group as any amounts that are owed to another business, bank or other person. As mentioned in the Chart of Accounts section the liability accounts are grouped from 2000 to Following is a listing of the liability account classes and their descriptions used by QuickBooks: Liability Loan Credit Card Accounts Payable Other Current Liabilities Long-Term Liability Any amounts owing. This class can represent any type of liability and encompasses all liability classes. Tracks the principle owed on a loan or line of credit Credit cards used by the company Amounts owing to vendors for goods or services provided. Example: Knowledge Bureau Payable Other amounts owing may arise from transactions outside of the company s usual business. Amounts owing to a creditor to be paid in the long term usually more than one year. Asset Account Classes Following is a listing of the asset account classes and their descriptions when using QuickBooks: Bank Accounts Receivable Other Current Asset Other Assets Fixed Assets Any bank with which the company holds an account or petty cash, cash to be deposited, etc. Amounts owing by a customer for goods or services provided Other amounts owing to the company. They may include inventory, prepaid expenses, loans made by the company, cash advances to employees, etc. Other assets may include Goodwill, long term notes receivable, etc. Capital assets owned by the company, such as land, building, equipment, etc. 9

10 THE KNOWLEDGE BUREAU 2011 Bank Reconciliation The starting point for setting up a bank reconciliation in QuickBooks for the first time is to start with a manually balanced bank reconciliation from a previous month. In the Home Screen, click the Reconcile icon from the Banking section. Choose the account to be reconciled. Enter the statement date, ending balance, service charges, date, and account to charge the service charges to, and interest earned, date, and the account to charge the interest to. Click on the Continue button. 10

11 THE KNOWLEDGE BUREAU 2011 This screen will show any transactions posted to the account. Check the cleared items as shown on the bank statement. If there is a zero balance in the Difference field then the account is reconciled. QuickBooks offers online banking features. To access, use the options found in the Banking Menu under Online Banking. 11