QUICKBOOK CERTIFICATION EXAM 2024, Exams of Nursing

Download QUICKBOOK CERTIFICATION EXAM 2024 and more Exams Nursing in PDF only on Docsity! 1 | P a g e QUICKBOOK CERTIFICATION EXAM 2024 WITH ACTUAL CORRECT QUESTIONS AND VERIFIED DETAILED ANSWERS |FREQUENTLY TESTED QUESTIONS AND SOLUTIONS |ALREADY GRADED A+|NEWEST|GUARANTEED PASS|LATEST UPDATE Which of the following is not an app that is offered by Intuit as an add-on product? QuickBooks Enterprise Solutions The QuickBooks Online __________________ allows developers to connect their apps to QuickBooks and send data back and forth between them. Open API platform How do you log in to QuickBooks Online Accountant? Enter your Intuit ID at qbo.intuit.com Which of the following is information found in the Client Details screen? Current account balances Which of the following is an accurate statement about the Your Books section in QuickBooks Online Accountant? It is a QBO Plus company What is one option for creating a new QuickBooks Online Accountant firm? Be invited as the accountant user from a QuickBooks Online company 2 | P a g e Which of the following summary information of activity from clients' QBO companies can be found in the Client list grid in QuickBooks Online Accountant? Close Date Basic access grants which of the following permissions to team users? View-only access to firm information Which of the following lists is the same in both Your Books and QuickBooks Online Accountant? Customers Where do you manage wholesale billing for the QBOA firm? Gear Icon> Your Account You are getting frustrated because you are always changing the dates when you run reports. What can you do to set default dates for reports? Click on the Accountant ToolBox and choose Report Tools You may end up working with a company with a surplus of uncategorized transactions sitting in a Miscellaneous, Ask My Accountant, or Uncategorized expense account. What is the most efficient way to post these transactions to the proper accounts? Use the Reclassify Transactions tool to move the transactions from the uncategorized account to the proper expense account To import QBO data into ProConnect Tax Online, use the following workflow: Accountant Tools > Trial Balance > View Tax Return What does the Accountant ToolBox allow us to do that our clients cannot do on the Bank Reconciliation screen? Undo bank reconciliations Which of the following tools is not available in the Accountant Toolbox? Exceptions to Closing Date Report The Trial Balance tool in QuickBooks Online is a tool that: Pushes QuickBooks Online data to ProConnect Tax Online for online completion of the federal income tax return When creating journal entries as an accountant user, what can we do that our clients cannot do? Mark the journal entry adjusting Why is setting a closing date and a password strongly recommended? It prevents a client from making changes to a closed period 5 | P a g e Where can you add a new Customer to your Customer List in QuickBooks Online? The Customer Center > New Customer Which of the following best describes the functionality of the top navigation bar in QuickBooks Online? A place to easily access tools for entering transactions The QuickBooks Online App provides users with a more 'desktop like' experience. What feature does this app have that QuickBooks desktop does not? Ability to tile windows across multiple monitors Where can you find the Transfer function of QuickBooks Online? Quick Create How do you get multiple screens to display over multiple display monitors when working in the QuickBooks Online Apps? Windows menu > Menu items open new windows The Sales Center is found in the _________________________ in QuickBooks Online. Left Navigation Pane Which is not a benefit of using the QuickBooks Online Apps for Mac and Windows? You do not have to be connected to the internet to open your QBO Company Choose the statement that best describes QuickBooks Online's functionality related to sales forms and products and services: Charges to a customer on a sales form post to the account mapped to the product / service item's income account field How do you create a recurring invoice in QuickBooks Online? Start from existing transaction and create a template by clicking Make Recurring Which of the following are benefits of using the Online Invoicing Portal? Clients can correspond with their customers regarding invoice details What is the difference between an Invoice and a Sales Receipt? A Sales Receipt is meant to record an immediate acceptance of payment while an Invoice represents an expected payment in the future What are posting transactions related to sales? 6 | P a g e Invoice Receive P ayment Credit m emo Sales r eceipt Refund What are non-posting transactions related to sales? Estimate Delayed charge Delayed credit When you record a charge to a customer on a sales form, what account does the line item charge post to? The account mapped in the income account field in the sales information section of the product / service item If you do not use sales form or a product/service item, what account does the item charge post to? The income account you selected from the dropdown field How is a Credit Memo different from a Refund Receipt? A Credit Memo affects Accounts Receivable Which of the following is not a feature of Online Invoices? Shows total balance for customer for all open invoices Which of the following can be used for drafting bank accounts (ACH payment) in QuickBooks Online? QuickBooks Payments' Pay Now button on an Online Invoice The Bill screen is best used for which of the following tasks? To record bills to be paid later You have received a shoebox full of receipts from a customer to enter into QuickBooks Online. They are not sorted in any way, and they include check stubs from different bank accounts, receipts for cash 7 | P a g e expenditures, and credit card slips from different cards. Of the following options, which is the most efficient way to get them entered into QuickBooks Online? Use the Expense function and specify the bank, cash or credit card account in each transaction What is a benefit of recording expenditures on bills using product / service items instead of accounts? Use of Purchase reports Which of the following transactions can be recorded using the Expense feature? Credit Card Expense Which transactions are non-posting transaction when it comes to purchases? Purchase Order Billable Expenses Which transactions are posting transactions when it comes to purchases? Expense Cash Expense Credit Card Expense Check Bill Bill Payment(Check or Credit Card) Vendor Credit Credit card sales Sales tax payment Which of the below is NOT an advantage of recording a transaction as a purchase versus an expense? Only transactions posted as a purchase record activity directly to the general ledger and can be found on a Financial Report, such as the Profit & Loss report Which of the following is an important distinction between QuickBooks Online Payroll and Intuit Online Payroll for Accounting Professionals? Payroll is run inside QuickBooks Online with QuickBooks Online Payroll and outside of QuickBooks Online in Intuit Online Payroll for Accounting Professionals Where do you enter time tracking activities in QuickBooks Online? 10 | P a g e a handy resource for getting to know your new clients, gathering the required info to get their account set up, and discovering what their business needs are in order to best match them to a subscription level. NCC: Client Profile the basic contact information fro your client and their business. NCC: Needs Assessment lists all the functionality your client may need from QuickBooks Online, and encourages a better understanding of their business so that you can best advise on the subscription level they will need. NCC: Features and Solutions dives deeper into the subscription solutions that will best suit your client. The workflows you highlight as needs or requirements in the Needs Assessment tab will be pulled through automatically and displayed in column A. This enables you to see at a glance which subscription level is likely to be best for your client's business. NCC: Mileage If your client needs to track mileage, then collect their vehicle profile information during the requirements gathering stage. You can do this for each vehicle they need to track mileage for. NCC: Onboarding Checklist Use the Onboarding Checklist to gather any final additional requirements from your client. This will enable you to set up the appropriate QuickBooks Online subscription quickly and accurately. NCC: Self-Employed Profile If, after your consultation, it is clear the client requires QuickBooks Self-Employed, the QBSE Profile tab has been designed to ensure you acquire all the additional information you need from your client in order to set up their subscription, including whether they have a healthcare plan or a vehicle to take into consideration. Sales and Accounts Receivable relates to the transactions relevant to their customers. In this section, you'll get a better idea of their requirements for estimating, invoicing, price levels, and sales-tax circumstances. Expenses and Accounts Payable This part of the checklist covers their payment preferences, outstanding loans, petty cash limits, and reimbursable expenses, among others. Employees and Payroll One of the key areas you'll need to discuss is whether the company is run solely by the owner or whether your client has employees (and therefore payroll requirements). Other expense tracking needs 11 | P a g e Your new client may also have to track other expenses, such as mileage on a vehicle. They may also want to keep an eye on their income in order to estimate their future income tax bill. Ask your client what their current method for keeping track of their taxes is. If they are self-employed, they may not know that estimating their taxes is a handy feature of QuickBooks Online Self-Employed. Other daily operations needs Does your client hold stock as part of the day-to-day running of their business? How do they keep track of their inventory? If your client has inventory, they may want to include inventory tracking. If this is a requirement, you will be able to discuss with them how QuickBooks Online and/or third-party apps can help with this. Industry-specific needs Every client and every business is different, depending on their industry. For example, your client may need QuickBooks Online with third-party apps enabled to track their e-commerce or web-based sales, manage their logistics, manufacturing, shipping, point of sale, or many other variables such as their personal billable time. Specialized application needs There is a range of apps compatible with QuickBooks Online. Your client may benefit from a specialized app to handle an area of their business. They may even already use one. You will be able to use your knowledge of QuickBooks Online features to spot when a client has a requirement QuickBooks Online can't cater for on its own. That's where integrated apps come into the picture. From cloud storage to time-tracking, there's an app for just about everything. Reporting needs This section of the New Client Checklist helps you get a clearer picture of how your client prefers to run their reports. Which reports work best for them? How often do they run and analyze their reports? As an additional feature, if the client has employees, they may wish to add users to their accounts who have reports-only access. We'll look into that in more detail later in the course. Any other requirements Don't forget to ask your client whether there is anything else they may need that you haven't yet covered or asked. They may already have an accounting solution and wish to convert their existing account to QuickBooks Online. Transaction volume This section is important because it will reveal to ProAdvisors the transactional volume and scope of the client's business. It may, for example, indicate that the client might benefit from a QuickBooks Online Advanced subscription, if transactions exceed a threshold of 43,000. This is because QuickBooks Online Advanced offers accelerated data-entry features. Industry trends 12 | P a g e While you need to take the time to understand each client's specific requirements, there are some common themes and pain points based on which industry they're in. These are five common business industry types, and each comes with its own pain points: - Professional services - Contractor/field services - Retail and e-commerce - B2B wholesale business - Nonprofits IT: Professional services Managing cash flow is essential for these types of businesses, because they often incur expenses up front, before they receive payment. Time tracking and job costing are essential to ensure the profitability of any business. This holds especially true for these clients, who must spread limited resources—including their time—across various jobs. IT: Contractor/Field Services These clients are always out and about in the field, which means they don't have a lot of time for bookkeeping. They need solutions that let them stay on top of their books, wherever their projects take them. IT: Retail and e-commerce Retail and e-commerce businesses are optimized to sell products and deliver exceptional customer experiences. Sales, payment, and staff management systems must work closely together to better manage profit and loss. Understanding cash flow and balance sheets is necessary to run any business. It's especially important to retailers and resellers, who must manage sales and inventory on top of being ready to do taxes when the time comes. Managing inventory and avoiding out-of-stock situations are critical to the success of retail and e- commerce customers. IT: B2B Wholesale business Wholesale businesses rely on knowing their inventory at all times. They also need to be able to keep track of all the logistics that go with shipping orders of all sizes, from sales forms and invoices to store locations and agreements with shipping companies. IT: Nonprofit Nonprofit and charitable organizations often track the expenses of various programs and funds. Donations often have to be tracked in as well as out when allocated to various branches of the charity. QuickBooks Online seeks to help make keeping track of donations, pledges, and other funds quick and simple. Migration 15 | P a g e - 25 billable users - 3 accountants - No limit reports-only - No limit time-tracking Wholesale Billing Under this option, you (as the client's accountant) are billed monthly for the subscription and will have an itemized view of all your wholesale subscriptions for easy tracking. As our most trusted partners, we want to ensure that you receive the best pricing on QuickBooks Online, with up to 50% wholesale discount. With wholesale billing, you control how the cost is passed along to your clients. The benefits include: - Bundling expenses: Add the cost into the services you provide to your clients - Easy tracking: Receive a monthly itemized bill for your subscription for easy tracking - Switch anytime: Remove clients from Wholesale billing seamlessly or cancel anytime Direct Discount Direct discount is when you add a subscription through QuickBooks Online Accountant, but you want your client to pay. The client will be required to enter their credit card information when they sign in to the newly created subscription, but they typically get a discount on the pricing for a finite period of time. If clients sign up for Direct Discount, they get a limited-time discount on their subscription which then reverts to the listed monthly charge. Your client is billed directly for the subscription. Adding new clients: QBO Accountant If your client is new to QuickBooks Online and hasn't signed up yet, you will want to add them via QuickBooks Online Accountant. If you, as their accountant and ProAdvisor, set this up for them, you'll be able to: - Ensure they're signed up to the subscription level that best fits their needs - Take advantage of discounts, like wholesale billing - Access their books right away, using your own sign-in credentials, without waiting on an invitation - Assign access to team members in your firm to work on their books. Multiple users can be signed in at the same time Adding new clients: By Invitation If your client has already signed up to QuickBooks Online, they simply need to send you an invite. When you accept their invite, they'll be added to your QuickBooks Online Accountant, and appear in your client list. Adding new clients: Getting started As a minimum, you will need to enter: The business name and contact details The type of subscription How your client will be billed Which team members in your firm need access to the client's QuickBooks Online 16 | P a g e Adding new clients: Basic setup The first time you open your client's QuickBooks Online, you will be asked to provide more information about them in the new client setup wizard. When you answer these questions, QuickBooks Online will begin to customize the setup to meet your client's needs. You can still fine-tune these settings at a later date. For basic setup, you need to know: - Your client's industry How they make money: e.g. retail, by project, or as a service provider - Their business type: e.g. sole proprietor, corporation, partnership, or nonprofit What they need to do in QuickBooks Online: - Send and track invoices- Organize expenses - Manage inventory - Track retail sales - Track bills - Track sales tax - Pay employees Adding new clients: Fine-tuning QuickBooks Online can be fully customized to meet your specific client's needs. For example, here are just some of the additional features you may need to set up: Online payments Multicurrency Sales tax Adding new clients to QBO Accountant 1. Go to your Client Dashboard in QuickBooks Online Accountant 2. Select Add Client 3. Decide if the account is for a business or an individual. In this example let's assume it's a business 4. Enter the Business name 5. Add the client's email address 6. You can also add a Display name. This is how it will show in your QuickBooks Online Accountant Client Dashboard 7. Add their mobile number 8. You could also Add more info at this stage to capture their contact details, but we're going to come to this a little later 9. At this point in the setup process, you need to select whether the client is being set up with a QuickBooks Online subscription or not. If you choose Subscription, then the process will continue with the steps below. If you choose No Subscription, there is just one item left to do. Select which team member will have access to this client and then select Save to complete the process 10. Choose whether this client will be charged via Wholesale discount (bill your firm) or Direct discount (bill your client) 11. Select the subscription level suitable for their needs and select Save 12. If this is the first client you have added, you'll need to enter your firm's billing information to charge your account for clients on wholesale billing. You also have the option to include payroll at this stage 17 | P a g e and you can assign further team access to the new client subscription 13. Then select Save 14. When the subscription is created, the new client will get an email inviting them to set up a user account. But we don't need to wait for them to do this to get going on the rest of the setup 15. If you return to your Client Dashboard in QuickBooks Online Accountant, you'll see the new client is ready and waiting. Simply select the green QB icon to complete the rest of the new client setup wizard. 16. We're going to walk you through the feature options later, so for now you can select All Set and the job is done! Inviting an accountant and accepting an invitation 1. Ask your client to invite you to their QuickBooks Online as an accountant user. They'll find this option by selecting the My Accountant tab in the Left Navigation Bar. They will need the email address you use for QuickBooks Online Accountant. Note: Whichever team member accepts the client's invitation will become the lead for that client. If the team member's access is revoked in the future, the lead can be assigned to someone else 2. Once your client has invited you, go to your firm's QuickBooks Online Accountant email inbox. In there you'll see a mail. The subject line will read: [Company Name] has invited you to use QuickBooks Accountant]Select the Accept Invite buttonNote: if you have more than one Intuit ID under your email address, choose the ID you wish to associate with that client. If you already have QuickBooks Online Accountant, make sure to choose the user ID that you use to sign in to your firm. 3. Enter the user ID and password you use for QuickBooks Online Accountant and select Accept Invitation. If you have more than one QuickBooks Online Accountant firm under your user ID, you will be asked to choose the firm you wish to connect this client to 4. Select Continue and your Client List will appear 5. You're ready to get to work for this client! Client Overview Screen The Overview screen offers collapsible sections for Company Setup, Banking Activity, and Common Issues. When you initially view the screen, these will be in their collapsed state. COS: Company Setup Company Setup shows you the subscription level that the client is subscribed to, whether they are subscribed to a Payroll product, and whether Sales tax has been enabled.These indicate the complexity of the client's QuickBooks Online Company. COS: Apps You can also see the number of apps that have been connected to QuickBooks Online. There's a list of the first two rows and you can select the link to view all of the apps.It's really important to know which apps a new client might be using to fully understand their workflow. You'll want to review this on a regular basis because new apps are being connected all the time. COS: Banking Activity In the Banking Activity section, you can see the register balance of each bank and credit card account in QuickBooks. The register balance is the balance from the end date of the register, which could include 20 | P a g e Overview Understand the key benefits offered by an app as well as how the app works with QuickBooks Online. Reviews Many of the apps have been reviewed by customers and other ProAdvisors, and anyone can check these reviews out. You can also visit the app's website to read the privacy statement to find out what kind of information they share with other parties. Testing You may also want to test the app yourself before you recommend it to a client. You can create a trial company to test the app (because it's not recommended to test an app by connecting it to a live QuickBooks Online company). Most apps in the App Center offer a free trial period without the need to give credit card information. You can also request a demo of the app from the developer or sign up for a webinar to learn about it. Many developers offer partner programs, incentives, or special discounts for referring your clients. These can be an additional revenue stream for your firm. Understand the vendor's billing policy Check if your client will be charged monthly or annually. Make sure you can answer any questions the client may have regarding billing policies. Understand the vendor's onboarding and support services Make sure you know what your role will be up front and that you'll be able to get help directly from the vendor regarding setting up the app and troubleshooting client questions. Recommending apps for clients Cindy has been manually entering her sales from her website into QuickBooks Online, and this has been taking up lots of time that should be spent on other areas of her business. She has heard about the benefits of apps and wonders if there could be apps that can help save her time and streamline her processes. You know all about apps.com and offer to jump in and help her find a solution. The first step is to understand the existing process she uses and what technology is involved in the process. She tells you that her website platform keeps track of her customer, sales, and inventory data. She has been entering each sales receipt captured by the website into QuickBooks Online. Let's see if we can find an app on apps.com that can sync her data and enter her website sales into QuickBooks Online automatically! We'd certainly be heroes if we could save her time and make her job easier! If we know what type of website platform Cindy uses, we can enter the name into the search box because it will only show apps that include the keywords that we enter. Notice that there are apps to sync data between lots of different types of website platforms like Magento, Shopify, and WooCommerce. Which two categories would you find (POS)-based apps under? - Manage customers - Sync data How might you get lists and transactions into a new Quickbooks Online company? 21 | P a g e - Import Excel files - Convert QBD files Which subscription level in QBO could you recommend that would provide features such as tracking for sales and sales tax? Simple Start, Essentials, Plus, or Advanced To be listed in the QB App Center, apps must ______________ Meet strict requirements and undergo a testing process Wholesale billing has three key benefits. What are they? - Bundling all client subscriptions into one invoice - Easy tracking - Switch anytime Onboarding Workflow: Tasks The steps in the QuickBooks Online Accountant QuickStart template for onboarding aren't just a set of tasks to check off, but a list of opportunities to add value and develop a great working relationship. OW: Meeting the client and gathering information As we've seen, by using the New Client Checklist and asking the right questions, you can more accurately scope the client engagement, set expectations, and build a stronger collaborative relationship for the upcoming onboarding process. Once the contract is signed, providing a detailed onboarding plan and introduction to the onboarding team, and agreeing on payment arrangements are key ingredients for success. Getting this right gives the client the reassurance they may need that they're getting expert advice. OW: Recommending the best QBO solution A completed New Client Checklist will provide you with the information you need to recommend the best QuickBooks Online solution for your client. The completed Client Profile section will provide the information you need to complete the client's account settings for them. You can even request a copy of your client's logo to surprise your client with a customized homepage and sales template! OW: Customization Whether you're advising on a custom payroll setup, adding logos, or improving sales form templates, you can demonstrate your value to clients by helping them to build the best workflows for their unique business. When setting up lists for businesses new to QuickBooks Online, review their current customer/vendor lists to determine if you can utilize the current data to import into QuickBooks Online or if you can tailor it to their needs with some adjustments to their lists and categorization options. OW: Training and mentoring 22 | P a g e It's a great idea to help clients help you as their accountant/bookkeeper by training them in best practice methods. Training and mentoring also allows you as a ProAdvisor to highlight your value as a subject-matter expert, not just in accounting best practice and requirements, but also in how they should work in QuickBooks Online to get the best results. It's a great time to remind them to download the QuickBooks Online app so that they can keep track of their finances on the go. The sooner they're confident in recording their day-to-day transactions, the sooner they'll see the value and time-saving benefits of QuickBooks Online and their trusted advisor—you! QBO Status Updates There are lots of benefits of having your client's financial information in the cloud. But what happens if there's a problem? As part of your client onboarding process, it's a good idea to make them aware of how to deal with outages. SU: How do I know if there's an outage? In the U.S., we continuously monitor QuickBooks Online for outages and slowdowns. We provide status updates on any service outages or interruptions here. If you or your client have any problems accessing products in the QuickBooks ecosystem, visit this site to see if there's a service interruption. SU: How can I get notified when it's fixed? If any of the products experience an outage or interruption, the banner will let you know what's happening. By selecting the Subscribe button, you'll be automatically notified when the service issue is addressed and resolved. Where can you find the QuickStart of client onboarding tasks? - In the Work tab of your QBO Accountant firm What is the Chart of Accounts? The purpose of bookkeeping is to create a record of financial transactions that are organized in a way that allows you and your client to analyze the business financial data, run financial reports, and prepare for taxes. These transactions are organized in the Chart of Accounts, which forms the backbone of the accounting system. How to add a Chart of Accounts Now that you understand the importance of the Chart of Accounts, let's see what it looks like in QuickBooks Online. Craig needs to create a subaccount to capture the professional fees his business incurs. Once set up, this will help him track money he pays to professionals to help you run his business. When you create a new account, you can assign it a name which will appear in the Type column. The type is broken down into Assets, Liabilities, Equity, Income, and Expenses. 25 | P a g e Editing Account Names Sometimes it's a good idea to make things a little easier for clients by making account names more appropriate and easily identifiable. This helps them avoid errors and posting to the wrong accounts when recording transactions. In Chris's COA, we're going to make his petty cash account more identifiable by changing its name from the default Cash on Hand account to Petty Cash. To edit the name of the account: 1. From the Left Navigation Bar, select Accounting and choose Chart of Accounts 2. Then find the Cash on Hand account in the list 3. From the Action column drop-down menu, select Edit 4. In the Account dialog, update the Name to Petty Cash 5. Select Save and Close Merging Accounts and Making Accounts Inactive Merging and deactivating accounts may be more appropriate or more necessary when onboarding clients who have already started using QuickBooks Online. QuickBooks Online users that haven't had ProAdvisor guidance, tend to add lots of additional accounts when recording transactions. Merging Accounts Merging accounts is a good idea if two accounts are being used for the same thing. This is a more common practice when a client has started using a file and has added accounts that they did not need for their recording and reporting purposes. However, a default COA setup can still be optimized by merging accounts. In Chris's case, the accounts haven't been used yet, so they have no transactions linked to them. If they did, the transactions for the merged accounts would also be merged to appear under one entry in any reports we run. Note that the merging process is permanent and cannot be reversed. 1. Select Accounting in the Left Navigation Bar, then choose Chart of Accounts 2. Locate the account to be merged in the list. In this case, we're looking for his Bank Fees account which we're going to merge with his Bank Service Charges account (because he doesn't need both) 3. In the Bank Service Charges row, select the downward arrow under the action column and select Edit 4. Highlight, right-click and copy the name of the account Bank Service Charges 5. Select X to close the Account editing window 6. In the Bank Fees row, select the downward arrow under the action column and select Edit 7. In the editable Account name text box, change the name of the Bank Fees account to Bank Service Charges 8. Select Save and Close 9. When prompted whether you want to merge the accounts, select Yes Making Accounts Inactive 26 | P a g e When setting up a client file, it's a good idea to make any default accounts inactive if they aren't going to be used. This keeps the COA tidy and efficient and prevents the client from posting transactions to the wrong or a redundant account in error. One of Chris's accounts isn't appropriate for his needs. Let's make it inactive, so it no longer appears in his Chart of Accounts and in other places where accounts can be selected (such as account lists on invoice screens). 1. Select Accounting in the Left Navigation Bar, then choose Chart of Accounts 2. Find Corporate Taxes in the Chart of Accounts list 3. Select the drop-down in the Action column, then choose Make Inactive 4. Select Yes to confirm If we need to make an account active again, the steps are: 5. Above the Action column, select the small Gear icon, then check Include inactive 6. Find the account you want to make active again 7. Select Make active By default, inactive accounts are not visible from the Chart of Accounts. If the account contains transactions, they remain as part of the company data. Inactive accounts are still visible on reports if transactions were posted to the account when it was active. The accounts are listed as deleted on reports. Account Editing Limitations: You cannot delete or merge the following accounts: - Undeposited Funds: You cannot delete this account because it is required to properly record payments before they are deposited. - Opening Balance Equity: This account is the default account for adjustments. You can only edit the name of this account, if necessary. - Retained Earnings: This account is the default account for reporting retained earnings on the Balance Sheet report. You can change the name of the Retained Earnings account if, for example, you are a nonprofit that prefers to use another name for retained earnings, but in all other cases, the name should not be changed. - Inventory/Stock Assets and Cost of Goods Sold/Cost of Sales: If you try to edit or delete these accounts, any edits to Products/Services will recreate them - Reconcile/Reconciliation Discrepancies: This account is used to report when transactions in QuickBooks Online don't match the transactions reported on your bank statement, and this account cannot be deleted. - Unapplied Cash Payment Income: This account is used to report cash-basis income from customer payments that were received but not applied to a sales form. - (Sales tax agency name, such as GST/VAT) Payable: This account is created when you set up sales tax and reports the sales tax for every transaction. You cannot delete this account. Accounts that can be edited, but not deleted or merged: - Services: The Services income account is the default income account in QuickBooks Online. It operates the same as any other income account, but neither it nor the corresponding Product/Service item can be deleted. However, you can edit the names of both to reflect a main income type. - Uncategorized Expense and Uncategorized Income: These accounts are created automatically when 27 | P a g e entering an opening balance for a vendor or customer, and recording any expense or income transactions that can't be matched to an account. You cannot delete these accounts. - Uncategorized Asset: This account records any asset that cannot be matched to an account and cannot be deleted. - Owner's Equity: This account represents the cash or assets invested in the company, and cannot be deleted. What are the four types of products and services? - Inventory (Plus and Advanced only) These are products (such as a generator, electrical panel, or air filter) that are bought and sold, and where it's necessary to track quantities on hand. You must subscribe to QuickBooks Online Plus or Advanced to use this feature. - Noninventory These are products bought and sold where it isn't necessary to track quantities on hand, such as the wire or nuts and bolts used in a generator installation. - Service This includes services that are provided to customers, such as an emergency service call visit or other labor. - Bundle This is a collection of products and services that are sold together, such as the installation of a generator that includes both labor and materials. Product and Service Settings: Show Product/Service column on sales form - must be selected to use Product/Service items on sales forms. Deselecting this setting will limit users to adding only descriptions to each line item of a sales form and will use the default Product/Service item created by QuickBooks behind the scenes. Chris needs to keep track of the different products and services he provides to his customers, so he'll keep this box selected. Product and Service Settings: Show SKU column - will add a column to track SKU numbers to sales and purchase forms. Chris doesn't track SKU numbers in his business (they're most commonly used in retail and other product-based businesses). Product and Service Settings: Turn on price rules - enables the Price Rule feature in QuickBooks Online Plus and Advanced subscription levels. This feature allows you to create special pricing for different types of customers and products/services. Product and Service Settings: Track quantity and price/rate - adds the quantity and rate columns to sales and purchase forms. Chris wants his customers to know how many hours he is spending on the work he does for them and how much material is used in each job, so he'll turn this feature on. Product and Service Settings: Track inventory quantity on hand - turns on the inventory-tracking feature in QuickBooks Online Plus and Advanced subscription levels. Chris won't be tracking inventory in his business so he can leave this feature turned off. 30 | P a g e Chris may not have provided customer information for every field. Don't enter anything in the Opening Balance field because this will make adjustments to the General Ledger for each customer upon import. When the mapping is correct, select Next The Import screen displays the data before we actually import it into QuickBooks OnlineHint: You can make changes to the data here if you need to. We're happy with what Chris has sent us so that we can move on to the import. Select Import. QuickBooks Online will tell us if the data was imported successfully - In the Customers tab of the Sales screen we can see all of Chris's imported customers. What is a vendor? Vendors are businesses Chris uses to buys things. Payments to vendors are money-out transactions. Setting up vendors means clients can do two things. Vendor Information: Company You'll start by entering the company name. This is the information that will appear on all bills and purchase orders that Chris creates. The Display Name field will automatically be populated based on the information that you entered in the Company field. Note that if the vendor is an individual, or you want the contact person to be listed, you should fill in the first and last name at the top of the screen. Vendor Information: Print on check as This field should be automatically populated, based on what you entered in the Company field. If for some reason the payee is different from the company name, you can remove the check mark and enter the company name that checks should be made payable to. Vendor Information: Address Here, you enter the address where Chris will mail his payments. This is also known as the remit-to address. Vendor Information: Cost rate, Billing rate, Terms If Chris ever needs to change the default payment terms for any vendor, he can do so in this Vendor profile screen. The cost rate only appears if the client is using Projects and the vendor is not being paid via expenses or bills but as, say, a contractor on a daily rate billable to the client. Vendor Information: Opening balance Use this field when setting up a new vendor to record the beginning balance for a new vendor. In almost all cases, it should be empty. When an amount is entered here, QuickBooks will automatically create a journal entry to increase accounts payable and decrease the Opening Balance Equity account. Vendor Information: Account number Enter the vendor's account number. This is helpful for a utility payment, for example. The account number will show up on the memo on the check. Vendor Information: Business ID no. 31 | P a g e The Business ID is where you can store the tax ID number (Employer Identification Number or Social Security number) of a vendor. This number is used when creating Forms 1099-MISC in QuickBooks. Vendor Information: Track payments for 1099 Track payments for 1099 selects the vendor to be used in the 1099 wizard when creating Forms 1099- MISC in QuickBooks. Adding a vendor Select Expenses from the Left Navigation Bar Select Vendors Hint: If this is the first vendor you have added to Chris's file, you are taken straight to an easy entry screen. If you've been here before, just select New vendor Enter Lang and Sons Electrical Supply to the Company field In the Address field, add 8839 East Smoky Hollow Court, Rochester, NY, 14606 In the Email field, add Angela@email.com Phone: 555-5570 Mobile: 555-556-9019 Leave the Opening balance as zero In the Terms drop-down, select Net 30 Enter the date Select Save This entry will now show in the Vendor list in the Expenses Center. Importing a vendor list Chris has forwarded us the list of his vendors, so let's help him by adding it into QuickBooks Online: First, we select the Chris's vendors file and download it to the Desktop of your PC or Mac so you can find it quickly From the Dashboard, select Expenses from the Left Navigation Bar In the Expenses screen, select the Vendors tab Select the drop-down arrow next to the green New vendor button and select Import vendors Now browse for the Chris's vendors file you downloaded Select Next Because the fields have been set up to match QuickBooks Online format, they will have imported correctly. It's a good idea to have a look at the sample file for future reference, then you can advise your client on how to prepare the lists for import. Select Next Make any necessary edits Select Import All the vendors and their details should now be in the vendor list, in the Expenses screen under the Vendors tab, ready to use. If an opening balance of $100 is recorded for a vendor you just added, QuickBooks Online creates a journal entry. Which 2 options from the list are features of this journal entry? 32 | P a g e - The journal entry will increase accounts payable - The journal entry will decrease the Opening Balance Equity account Connecting Bank Feeds Go to the Banking Center in the Left Navigation Bar If it's the first time here, select Connect, otherwise select Add account Select the bank Use the regular username and password to sign in (as for banking online). (You might want to do this with your client so they sign in to their bank and you don't have their banking password) It might take a couple of minutes for the bank's database to talk to QuickBooks Online. Choose the bank account for the business and the account in QuickBooks Online If you don't see a QuickBooks Online account in a list that matches the bank account, don't panic. Just select Add New Choose the account type, either bank or credit card, and choose a detail type Give the account a name, then select SaveIt's that simple!QuickBooks Online connects to the account and by default downloads all the transactions for the last 90 days. What is OAuth? OAuth stands for open authentication. It means that your client no longer has to provide their bank username and password after initial setup. Instead, your client gives permission at their financial institution (FI) for QuickBooks Online to access their account. Their bank sends QuickBooks Online a token that is used to access their account. After that, QuickBooks Online can still securely access the account even if your client changes their password, giving them a more reliable connection. Which bank are moving to this connection? QuickBooks Online is working with individual banks to change the way it connects to them. This is why your client will only see some banks offering this new connection, at least for now.So far, Capital One, Chase Bank, Wells Fargo, Bank of America, PNC, USAA, US Bank and Citi have agreed to move toward a better connection for QuickBooks Online customers. You can find more exact dates and timelines for each bank here. Over time, more FIs will make the move, so stay tuned! Can anybody who has access to the bank website set up the new OAuth connection? Some banks or financial institutions have restrictions on who can establish this new OAuth connection. The primary user for the bank's website can always set up the connection, but sometimes delegate or secondary users can't establish the connection. For more information, take a look here. However, this is not something you can do on your client's behalf because it requires the sign-in credentials for their bank or financial institution. Is there a deadline for my client to update their existing connection? It depends on which bank they're updating. Each bank gives a window of time to migrate customers over to the new connection. Usually, this window lasts 31 days to give your clients enough time and warning to update their connections 35 | P a g e the sales tax calculation on invoices via a link. Selecting the See the Math link on the invoice will open a pop-up that shows you how sales tax was calculated. The Sales Tax Center As clients collect sales tax from their customers, the Sales Tax Center will keep track of how much sales tax they owe to each tax agency.Let's take a quick tour around its key features in another client's QuickBooks Online. Sales Tax Center: Sales Tax Due This is the total amount your client currently owes to one or more tax agencies. Sales Tax Center: Tax Breakdown Area Due this month: This shows taxes that are currently due, in other words, require more immediate action.Upcoming: Shows tax amounts being accrued for the following period.Overdue: Shows taxes in which the due date has passed and no tax payment has been recorded within the QuickBooks Online account. Sales Tax Center: View Return When it's time to file the return and for your clients to pay sales tax, you can View return to give you the information you need to file the tax return outside of QuickBooks Online. Typically, you need to go out to the state's website to pay the tax and file the forms. You then record the payment in QuickBooks Online, so that it can be marked as filed and moved to your client's history area.Record the payment in QuickBooks Online by selecting View return and then the Record Payment button. Sales Tax Center: History Here, you can review any returns that were previously marked as paid/filed within QuickBooks Online. Sales Tax Center: Sales Tax Setting Here, you can view and edit any tax agencies you have set up within your client's QuickBooks Online account, and add new agencies. A tax agency can be made inactive at any time by selecting the Edit button next to it. Sales Tax Center: Reports You have shortcuts to the Sales Tax Liability report and the Taxable Customer report. All other reports can still be found using the Reports tab on the Left Navigation Bar. Sales Tax Center: Shortcuts Shortcuts here mean you can be just one tap away from everything that feeds into sales tax calculations, like customer addresses, product and services lists, and more. Once sales tax has been set up, what criteria does QuickBooks Online use to calculate the sales tax owed on an invoice? (Select all that apply) 36 | P a g e - The state where you are registered to collect sales tax - The physical address of the client's business - The customer's physical address - The customer's sales tax status - The tax category for the product or service Your client wants to review how much sales tax they paid last quarter. Where will they find this information in the Tax Center? History - The History link is where you review any returns that were previously marked as paid/filed within QuickBooks Online. Setting Up Payments: QB Payments have to offer? As Chris's business expands, he'll have more and more customers paying invoices at different times. No matter how many payments per month Chris expects to receive, QuickBooks Payments will make this a seamless process. QB Payments: Key Features What fees are involved? Chris will pay a small fee per transaction processed. The merchant service plans include Amex, MasterCard, Visa, and Discover. Once Chris has applied for QuickBooks Payments, Intuit will verify his details. If he's approved, his merchant account will be created. Once approved, Chris will then be able to start enjoying all the great features QuickBooks Payments has to offer. With prior authorization, customers can pay via an online invoice, just by selecting a Pay Now button, or in person via a card reader. Alternatively, they can pay through pre-authorization or via phone when Chris has set this up. Chris can also type in credit card or bank account information directly in QuickBooks Online on the Receive Payment screen. He can email invoices that contain a link, allowing his customers to view and use Pay Now securely His customers can easily pay via credit card or ACH debit (electronic bank transfer) with the tap of a button He'll still be able to accept payments in person or over the phone. QuickBooks Payments processes credit card payments directly from the QuickBooks Online Sales Receipt and Receive Payments He can also use a card reader to receive payments in person via the mobile app The Receive Payment transaction, subsequent batched bank-deposit transaction, and even the merchant service-fee transaction are all automatically recorded in QuickBooks Online by the QuickBooks Payments service How long do payments take to reach Chris's accounts? Chris can sign up for next-day deposits to speed up payments so that all payments hit his account the next day. Setting up QB Payments Let's now guide Chris through the process he needs to follow to set up his account with QuickBooks Payments. It's important to remember that your clients need to sign up for QuickBooks Payments themselves 37 | P a g e because the process forms a contract. If you were to sign them up, you'd be signing the contract—not your client. Note that there might be some variation in the steps if, for example, the bank account is already set up in QuickBooks Online. The first stage is to sign up for QuickBooks Payments, then we'll look at the settings that are available. Select the Gear icon Navigate to Account and Settings Select Payments from the left-hand navigationBecause Chris has not signed up for payments, his only option is to select Learn more. Select Learn more Select Finish setup or Get setup Now there are three sections to complete. Select the first section The first section is information about Chris's business. You'll see that some of the fields have already been populated with information from the Company section of Accounts and Settings. Make sure Chris checks the details and makes corrections where needed Chris doesn't have an online presence just yet, so he needs to select the No website or social media links checkbox Select Next to move on Here, Chris can add personal details as the owner Chris needs to add his name, Chris Grier, and his address Note that QuickBooks Online will help find the address and try to validate it. Because we're using a dummy address in this demonstration, Chris selects the checkbox next to Use the address I entered Chris now needs to enter his date of birth and contact number, and the last four digits of his SSN, 1235 Select NextThis last page is where Chris will add his business bank account number and bank routing number. Connect to an existing QB Payments account Because Chris didn't already have an existing QuickBooks Payments merchant account, he needed to apply for one.If you have a client who already has a QuickBooks Payments account (also known as GoPayment, or QuickBooks Merchant Services, or Intuit Merchant Services, or Intuit Check Solution) and you need help syncing or migrating, select the Help menu then Contact Us from QuickBooks Online Accountant and follow the instructions to receive a callback from Support. Note that the QuickBooks Payments account can be used with either QuickBooks Desktop or QuickBooks Online at any given time. It won't work with both simultaneously. Signing Up for QB GoPayment For clients who are out on the road, a mobile point-of-sale app like QuickBooks GoPayment is an ideal way to get paid fast. With a free mobile credit card reader, they can easily accept mobile payments on goods and services— anytime, anywhere. What's more, the transactions automatically reconcile with QuickBooks Online for hassle-free bookkeeping. With a free Bluetooth-enabled mobile card reader, clients can accept magstripe and EMV chip debit and credit cards, along with Apple Pay, Google Pay and Samsung Pay. 40 | P a g e policy. This is important because it specifies how your information and data is handled or shared. Once you've checked out an app, you can select the Get app now button. You get options to install the app for your firm or for a specific client (which you can select from the drop-down list). Who can add and manage apps subscriptions for clients? Select all that apply - Firm Primary Admin - Full Access team user Additional setup tasks Many clients considering QuickBooks Online (or new to it) will need options set up for them beyond what we've looked at already. Your client, Cindy, recently opened a retail store to sell her beauty products. Thanks to some great marketing work and the quality of her products, she's had to start thinking about taking on additional employees. She's considering her options with QuickBooks Online Payroll, an additional QuickBooks product that integrates with her QuickBooks Online file. She may also need some help with her lists, so we may need to take a look and make some adjustments. QBO Payroll options QuickBooks Online Payroll has three subscription levels: Core, Premium, and Elite. QBO Payroll Options: Core QuickBooks Online Core Payroll covers the basics for you and your clients. To help clients and accountants avoid payroll errors, all subscription levels offer full-service features. These ensure payroll tax deposits and forms are filed correctly and on time. Most clients will be happy to input employee working hours but want some help processing regular payroll runs, and may prefer an accountant/bookkeeper to take responsibility for employee setup, overseeing remitted taxes, and filed forms. QuickBooks Online Core Payroll features include next-day direct deposits, unlimited payroll runs and auto payroll to support your payroll needs. For clients considering QuickBooks Online Payroll, you can use the New User Checklist to gather the necessary information to complete the setup. Take a look in the further resources section at the end of this lesson to see and download the New User Checklist. QBO Payroll: Premium QuickBooks Online Premium Payroll is the perfect way to manage your payroll needs. The Premium payroll subscription includes all the features of Core, plus same-day direct deposits, expert setup review and TSheets time tracking. QBO Payroll: Elite QuickBooks Online Elite Payroll is the most robust option. It has a complete payroll service with a team of U.S.-based payroll experts to take care of payroll for your client. QuickBooks Online Elite Payroll includes TSheets for employee time tracking, and guarantees accuracy, 41 | P a g e so the payroll setup, payday, and taxes are done right. If there is ever an issue, Intuit offers full tax representation to take care of it for you. Which payroll option would you recommend so that Intuit's penalty-free guarantee protects you and/or your client? With QuickBooks Online Elite Payroll, if there is ever an issue, Intuit offers full tax representation to take care of it for you.* *Terms and conditions apply. Adding extra lists There are several other lists that can be set up as required, depending on your client's needs. To take a look at the other lists that are available, go to the Gear icon and All Lists. Here are some you might find useful. Select the tabs in turn to find out more. Adding extras lits: Payment methods This displays cash, check, and any other ways you categorize payments you receive from customers. That way, you can print deposit slips when you deposit the payments received. Some examples of other payment methods are ACH or EFT. Also, you may want to have payment methods for each type of credit card accepted. Adding extras list: Terms This displays the list of terms that determine the due dates for payments from customers, or payments to vendors. Terms can also specify discounts for early payment. Adding extras lists: Attachments This displays the list of all attachments uploaded. From here, you can add, edit, download, and export your attachments. You can also see all transactions linked to a particular attachment. Customizing Sales Forms: Invoices Let's take a look at how you can customize invoices for your clients. Alison Ganz is a bookkeeper on your team. She needs to create an invoice for an onsite service on behalf of Chris Grier and send it to a customer, Elizabeth Mason. The invoices for Chris Grier use the standard black-and-white template. Alison would like to apply a new logo supplied by Chris to the template. Once signed in to QuickBooks Online Accountant, select Chris's account Viewing Emailed Invoices Let's see how the invoice looks to Samantha Rembo. She uses her mobile phone to access the Gmail app. When she's busy, she finds it difficult to pay her invoices on time. Being able to pay directly from the email will help her manage her payments more efficiently. Samantha logs in to her Gmail account and finds the invoice from Chris She selects the email 42 | P a g e The key points of the invoice display within the email so that everything Samantha needs to understand and review is laid out clearlySamatha can see: who the invoice is from the amount owed the payment due date what the invoice is for and even the message reminding her to book a meeting to discuss her upgrade using the Pay button, Samantha will be taken directly to QuickBooks Online Invoicing where she'll be able to make her payment electronically, if she has signed up for this facility the full invoice is also attached as a PDF Clients can boost their payment speed to the next level by turning on QuickBooks Payments, giving their customers the freedom to pay their way by accepting all credit cards and free bank transfers. This allows customers to pay directly in the Online Invoicing portal at the tap of a button. This unique Pay Now link ensures that payments are encrypted. It's powered by technology from the makers of TurboTax and Mint, so it's secure and reliable. You are about to raise an invoice on behalf of Carol Walker, a small store owner. Walker's Wonders is a confectionery store with a fun and vibrant logo. The invoices for Walker's Wonders use a standard template. As well as adding the logo to the invoices, how else can you customize the invoice? Select 3 options. - Add color to the highlighted areas - Set the size and poistion of the logo - Change the font style and size Managing Client Access Clients with employees value the ability to control access to their QuickBooks Online, allowing them to choose who can see and edit their financial data. In this lesson, Cindy, who runs a retail business selling bee beauty products has a new employee. She needs some help setting up permissions for them. Client Acces: User Permission Settings Some of your clients will require employees in their company to manage or oversee parts of their business. Perhaps you want them to just enter time or review reports. Therefore, the clients will want permissions set up so they can fulfill their role. When you set up Cindy's Bee-uty Bar, you gave her full Company Administrator permissions to perform all tasks within her company's QuickBooks Online account. If Cindy wanted to give one or more of her employees access to the account, there are four types of user permissions that you can set up for her. Time-tracking only This enables users to sign in to a special version of QuickBooks Online that only has timesheets. This is where users fill out and change their own timesheets but don't have access to other users' timesheets. Reports only Users sign in to a special version of QuickBooks Online that gives them access to almost all reports, except Payroll and list reports that include contact information (QuickBooks Online Plus only). Company administrator 45 | P a g e You have been asked to add a new user to another company. Ryan Zurowski has just joined the team and the owner wants him to be able to run reports, but without being able to change anything in the QuickBooks Online company. You set him up as a Reports Only user. Ryan has access to the new Reports Center. He will see the account differently from those with full access. Reports Only users: Select each hotspot in turn to see what's different - There's no navigation panel in the Reports Only view. Ryan doesn't require access to any other part of QuickBooks Online—everything he needs is on this view. - The Search icon has been removed. Everything Ryan needs is on this screen—he doesn't need to search for anything else. - Even if they are accessing the Reports Center from QuickBooks Online Accountant, a Reports Only user won't see the Accountant Toolbox. Ryan doesn't need access to this. - Ryan can still add reports he uses regularly to Favorites. - In order to focus on areas of the reports he needs for each task, Ryan can collapse report sections to hide data until he needs it. Switching between Accountant and Business view In QuickBooks Online, there are two user views: Business view and Accountant view. You can switch between them anytime. The main difference is the appearance. Feature, menu, and button names are different, but the actions in each view are identical in most cases. Some features are only available in one view or the other Accountant view As an accountant or bookkeeper, this is the view for you. It uses standard accounting language and gives you control over features like your client's chart of accounts and other features that are aimed at the experts. You may choose to recommend your client also uses this view, so that when discussing their accounts you both see the same product navigation. Business view Small business owners who use QuickBooks Online without the support of an accountant or bookkeeper might prefer Business view. This view simplifies the workspace so that day-to-day tasks like sales and billing are easier. It uses non-accountant terms. This lets them do their accounting without learning complicated steps or processes. How to switch views Based on the information entered when QuickBooks Online is first set up, you'll start in either Business or Accountant view. Changing views doesn't affect your client's accounts or data. Select Settings, Gear icon Select Switch to Business view or Switch to Accountant view 46 | P a g e You have set up a new user and removed payroll access. They will still be able to see some payroll entries, though these will be anonymized. What can't they see? - The Employees tab in Workers Users without payroll access will be able to run reports and access the Bank Register in order to process all other information relating to the business. They won't be able to see employee information except where it has been masked. Manging the Client List As a busy practice manager, Lisa Garcia's working life is ruled by deadlines. Switching between lots of different solutions and packages to manage the tax, accounting, and payroll needs of clients, not to mention keeping track of email, to-do lists and a whole host of Excel spreadsheets: it's exhausting. Plus, what happens if she accidentally works on an old version of a file? It's enough to keep her awake at night! Client List The Client List gives you a one-stop shop for all your client information—even clients who don't use QuickBooks Online. Keep your client contact info, notes, and documents close at hand with a consolidated Client List. And access client QuickBooks Online accounts and ProConnect Tax Online from one location. Client List: Add client If your firm gets a new client, it's easy to add them to QuickBooks Online Accountant. Client List: Filter If you work in a large practice, the client list can be long. You can filter the list to only show clients assigned to a particular lead Client List: Banking Check the status of the client's online banking transactions. Client List:Prep for Taxes Select Review Data to open the Prep for Taxes tool. You'll be able to quickly review balances and make year-end adjustments to your clients' books. You can also map the accounts in QuickBooks to the tax form lines and export balances to ProConnect Tax Online. Client List: Tax Returns Here, you can see any tax return information relevant to the client, including the status of any return that has been started. Client List: LEad Easily see which lead is assigned to each client. 47 | P a g e Client List: Actions Here, you can edit the client's details, start Prep for Taxes, create a tax return, or make clients inactive. Client Details: Edit Here, you can view or edit your client's contact information, see details of their subscription, and check which members of your firm have access to the client. Client Details: Notes The Notes tab lets you easily capture notes created by your team. You can see who created a note and when. Here's how it works: When you add a note to the client file it's automatically stamped with the time and original author. Notes can be viewed and edited by all team members who have access to that client. Your client will never see notes added here, it's just for you and your team. You can include hyperlinks in notes to give your team fast access to relevant files and websites You can also add and view notes while you are in your client's books. Simply go to Accountant Tools and select Notes. Your notes will automatically sync to this client details section in QuickBooks Online Accountant and will only be visible to you. Client Details: Pinned notes You can also pin a note that is important or permanent, so it is easy to get that information at a glance. The Pins will always be listed on the right side of the Notes page. Client Details: Bookkeeping Here, you can see the closing date and QuickBooks subscription level. You can also see the Account Watchlist, which shows the current balances in the asset and liability accounts of the company, including key accounts such as checking and credit cards, and when these accounts were last reconciled. Client Details: Payroll If your client has QuickBooks Online Payroll, the Payroll tab shows the next pay date, the last pay date, and a summary of recent tax payments and form filings.It even links right into Payroll, so you can start the next payroll run directly from within QuickBooks Online Accountant. Client Details: Shared Documents Any documents you or your client upload to their QuickBooks Online My Accountant tab are stored here. With documents saved in a safe and secure location, there's no more worrying about sharing confidential information over email or wondering whether you're looking at the right version of a file. Client Details: Tax If you are using ProConnect Tax Online, you can view the filing status and access previously created income tax returns.You can also start a new tax return from here for non-QuickBooks Online clients or clients who are using QuickBooks Online but whose financial information you don't want to import into the tax return. 50 | P a g e Billable users are admin, standard, and custom users. You can see that this Plus client has three out of a possible five users. Chart Of Accounts The Chart of Accounts is the backbone of accounting software. All assets, liabilities, income, and expenses are recorded here in an account or subaccount. This client has got plenty of scope to increase the entries in their Chart of Accounts if they need to. Classes ad Locations Location tracking and Class tracking let you track your income and expenses in QuickBooks Online Plus or Advanced. Class tracking specifies a different class for each detail line of a transaction. Location tracking allows you to assign a location to an entire transaction.You'll learn more about setting up clients with classes and locations in Advanced Certification. Usage Limits: How are limits calculated?: Classes and Locations Counts towards: Active classes and locations Added by someone with permissions in the QuickBooks Online account Generated by a third-party application someone with permissions has connected to the QuickBooks Online account* (these apps are allowed to add above the usage limits) Does not count towards: Generated by QuickBooks Online at sign-up or from usage of services such as:- Sales tax-Shipping-Multicurrency System-generated entries created by other QuickBooks-related offerings such as: -Payroll-TSheets Imported into QuickBooks Online from QuickBooks Desktop Usage Limits: How are limits calculated?: Billable users Counts towards: Billable users are admin, standard, and custom users Pending invites you've sent (until they're automatically removed in 90 days) Usage Limits: How are limits calculated?: Chart of Accounts Counts towards: Active accounts Added by someone with permissions in the QuickBooks Online account Generated by a third-party application someone with permissions has connected to the QuickBooks Online account* (these apps are allowed to add above the usage limits) Does not count towards: Generated by QuickBooks Online at sign-up or from usage of services such as:- Sales tax-Shipping-Multicurrency System-generated entries created by other QuickBooks-related offerings such as: -Payroll-TSheets Imported into QuickBooks Online from QuickBooks Desktop Usage limits: Penalties To be fairer to all users, QuickBooks Online accounts that stay beyond usage limits will not be supported and can lose functionality and be suspended. In October 2019, users started being notified if they were over their subscription limits. They either were or will be given options to upgrade. Accounts that stay over a limit once they have received this notification will be suspended on the next renewal date. If a client's account is suspended: 51 | P a g e You will have read-only access to the QuickBooks data for one year, meaning that you or your client won't be able to add new transactions or change anything You/they won't be able to reduce usage You can't upgrade in QuickBooks Online You will lose any special wholesale billing discount of QuickBooks Online for this client You/they can export data to Excel or a desktop version of QuickBooks If your client is signed up for QuickBooks Online Payroll via their QuickBooks Online subscription, the Payroll subscription will also be suspended After your client's account is suspended, you'll need to contact QuickBooks Online to reactivate the account. Upgrading and Downgrading Keeping track of and managing usage is important to clients and, in fact, all QuickBooks Online users. The subscription level that was a perfect fit a few years ago may be a little too basic now. They may need more room to maneuver and improved features and space to continue to grow into. Let's look at how to upgrade and downgrade a client file. How to upgrade clients who aren't part of wholesale billing? (i.e. direct billing?) Select the Gear icon in the client's company and select Account and Settings Select the Billing & Subscription menu In the QuickBooks Online section, select Upgrade your plan In the Upgrade page, choose the plan you want and select Upgrade Confirm your payment information and select Save How do I upgrade clients on wholesale billing agreements? Select the️ Gear icon in your QuickBooks Online Accountant company file, then Subscriptions and billing In the Your subscriptions section, locate the client Select the Upgrade option in the Select Action column You can't upgrade pending wholesale clients. You must wait for that company to be fully moved over to your Wholesale billing account before you can make changes to a company's subscription. What should you consider when downgrading a client? Features: Downgrading means losing some features in your client's current QuickBooks Online plan. Make sure the new QuickBooks Online plan will meet their needs. Check out this comparison chart to review what will be lost when they switch Third-party apps: Changing a plan might affect some third-party apps connected to QuickBooks Online. This happens when the new plan doesn't support the feature the client app works with. Review each affected client's apps by selecting Apps in the Left Navigation Bar in QuickBooks Online Accountant, then selecting Client apps Plan discounts: Downgrading will remove all discounts on the current plan Would a client benefit from downgrading their subscription? 52 | P a g e For a variety of reasons, not every business keeps growing or grows as expected. Lifestyle changes or even a return to full-time employment may mean a client has smaller goals or expectations. To downgrade a client who isn't part of Wholesale billing, i.e. direct billing: Select the Gear icon menu in the client's company and select Account and Settings Select Billing & Subscription. Make sure your payment info is updated and valid Select Downgrade your plan. The Downgrade page shows your current plan, and other plans you can downgrade to. If you can't see the Downgrade option, go to qbo.intuit.com/app/changeplan to downgrade Find the new plan you want based on the feature list, then select Choose Plan Review what goes away with your new plan. If you're ready to downgrade, select Next Review your new billing details. Select Change plan to complete the process For wholesale clients, sign in to your QuickBooks Online Accountant company file, then: Select the️ Gear icon in your QuickBooks Online Accountant company file, then Subscriptions and billing In the Your subscriptions section, locate the client Select the Downgrade option in the Select Action column. (Note: if you don't see Downgrade as an option, that file cannot be downgraded) If your client upgrades to Advanced, and then downgrades back to QuickBooks Plus, Essentials, or Simple Start, they (or more likely you) will need to reduce everything to their usage limits when they downgrade. Which statement is true when a QuickBooks Online company file is suspended for exceeding usage limits? You or the client must contact QBO to have the file reactivated - The only option here is for you or your client to call QuickBooks Online and have the file reactivated, then either upgrade to the next subscription level or optimize the areas that are exceeding usage limits in the current subscription level. Managing your team QuickBooks Online Accountant has functionality that allows you to invite, deactivate, and control permissions for team users. This gives you peace of mind that team members can only access the areas they need to do their jobs. Your Team Depending on the way your practice works, you may need to give team members access to client accounts. Team users in QuickBooks Online Accountant are staff members of the accounting firm that oversees client files and the QuickBooks Online account. They could alternatively be bookkeepers or tax preparers not in the firm, but who still need access to the client. Team users will get access to client files, but clients won't see the names of the users and they won't see individual staff names. All the client is aware of is that they are working with an accountant specialist, or ProAdvisor. They could, in fact, be working with two or three. Managing team users and their access 55 | P a g e For Lisa and her busy bookkeeping and accounting team, the number of deadlines they have to juggle can be crazy. Missing a deadline can have serious consequences, like a fine or even losing a client. What Lisa really needs is a way to keep track of it all, so nothing falls through the cracks. The work features in QBO Accountant let you: Create projects and tasks right from your Work dashboard for all your clients, even if they don't use QuickBooks Online Add projects and tasks to track work for your firm Assign projects or specific tasks to you or your team members Set up repeating projects for the same client that will occur on a regular basis Duplicate existing projects across multiple clients to save time on manual entry Managing the Work center QuickBooks Online Accountant lets you organize your team and your clients in one central location. If your client doesn't use QuickBooks Online, no problem. You can add them as a client at the same time you create a project. All you need is their name and email address. No more need for separate to-do lists for different clients. Features on the Work center dashboard can help you manage requests and messages for your clients, along with all the work you do for them. You'll be able to manage your practice and stay organized, never missing a deadline! When you look at the Work center dashboard, you'll see a bird's-eye view of what's coming up for your firm, all organized by due date. Visualizing your work in this way means you can see straight away what's due today, next week, or next month. This will help you focus your attention, manage your time, and better understand your firm's capacity, thereby becoming more efficient. This functionality will also flag what's overdue, so you can deal with it straight away! You can view your work at a glance, filter by client, or show work that is for the firm rather than a client. You will also see the team user assigned to the project. If you have standard processes for doing things, you can become even more efficient. You can repeat projects for the same client or even duplicate existing projects across multiple clients to save time on manual entry. Now that's working smarter! Creating work for your team Lisa and her team love how this keeps them on track with managing their firm and client work. Right now, she wants to set up a project for a member of her team to manage Cindy's Bee-uty Bar's weekly payroll. Watch the video to see how it's done. The individual steps are below for you to follow. From the QuickBooks Online Accountant homepage, select Work in the Left Navigation Bar Select Create project Enter the project name Weekly Payroll From the Firm or Client drop-down, we can either choose My Firm or select a client, in this case it's Cindy's Bee-uty Bar Select a team member to allocate the work to. If Lisa wanted to do the work herself, she'd select Me as the user signed in to the account. But, in this case, we allocate the project to Alex Reedsmith Then set a due date for the project We can add notes later but let's go ahead and add a task. 56 | P a g e Select Add a task Name the task Request timesheets from Client Allocate the task to Alex Reedsmith Select the date the task is due Select Save Presto! The basic project and task we just created is saved in the Work Center. Lisa can add as many tasks as needed to manage this process. The dashboard makes it easy for Lisa and her team to see the status of all the projects. Once Alex has completed his first task of requesting timesheets from Cindy, how should he mark the task as done? Choose the numbered section from the options below. 2 - By selecting this drop-down, he will have the option to mark the task as To do, In progress, Blocked, or Done. If he selects Done, the task will be marked as completed and disappear from the Work dashboard. He can easily switch to List mode if he needs to see a full list of all projects and tasks, including the completed ones. Project templates As you saw, it's straightforward to create projects and add tasks, but it can be time consuming, especially if it's a process with lots of tasks. That's why QuickBooks Online Accountant includes a series of QuickStart project templates that include some of the common tasks a firm might need. In addition, you can create custom templates to map out projects and tasks that are specific to your firm. QuickStart templates Use QuickBooks Online Accountant's standard templates if you're mapping out a common series of tasks, or use it as a starting point. You can still adjust tasks, due dates, and assignees when you create a project from a QuickStart template. Alternatively if you prefer, duplicate it then edit it, add to it, or remove tasks to create a more customized project without having to start from scratch. Currently, QuickBooks Online Accountant features the following QuickStart templates: Bi-weekly payroll Client onboarding Monthly bookkeeping Yearly taxes Custom templates Custom templates allow you to build workflows specific to your firm's or clients' needs. They can be created from a QuickStart template or project, or from scratch. Once the custom template has been created, your team then has a consistent workflow to apply every time. For example, a common workflow for Lisa's firm is to manage their monthly client billing. She could save time by creating a custom project template with tasks to: Approve billable time 57 | P a g e Approve expenses Create the client invoice Create a project using a QuickStart template For some of Lisa's clients, the monthly bookkeeping workflow is pretty much the same tasks done in the same order by the same team members. QuickBooks Online's QuickStart templates are perfect here and will save Lisa a lot of time because she doesn't have to build a project from scratch. The work is already done and ready to pick up from the template list. Watch the video to see how it's done. The individual steps are below for you to follow. From the QuickBooks Online Accountant homepage select the Work tab Select Create project In the Project template field, select Monthly bookkeeping In the Create project window, you can see that by default, this template contains eight tasks. We need to add a project, name, let's call it Monthly bookkeeping Select the client the project is for. In this case, it's Cheng's Master VA & Designs Select the date the project is due. As this is a monthly project by default, it's automatically set to repeat, so we just need to select the day of the month it needs to be done by. In this case, select the Last Monday of the month Next, assign the project and its associated tasks to a colleague. Select Alex Reedsmith from the drop- down list Add any details you need to. These might be client-, firm-, or colleague-specific Review the tasks list and select Save Back on the Work screen, select Everyone from the drop-down listHere, you can see the new project tasks for Cheng's Master VA and Designs. Simply select a task to view the details. And that's the new project all scheduled and ready! Client Requests With Client requests, you can access shared documents and message clients securely, straight from your Work center dashboard. Managing Client Request You and your client will no longer need to share sensitive information over email. Client requests enable you to share messages and upload documents with ease—and it's all secure. All your requests are received and organized in your clients QuickBooks Online account. They can be found in the My Accountant tab. Clients can track your requests by due date, so they won't miss a thing and you'll get what you need on time. Your client can respond and share documents inside QuickBooks Online, so their sensitive information is safe. Documents you and your client share this way will also appear in the Shared Documents tab, in the Client details in your Client list; meaning you never miss a thing. Creating a Client Request Lisa and her team love how this keeps them on track with managing client work. Right now, she wants to send Dan Cheng a client request for him to send her his bank statement. 60 | P a g e ______________ What are the missing steps? - Creates bill in QBO - Makes payment When you create the bill in QuickBooks Online, it will show up in Accounts Payable, so Craig knows money is due to come out of the business. But he can help his cash flow by keeping money in the bank for the next 60 days until it's time to pay his vendor. Undeposited Funds Two envelopes just arrived in Chris's mailbox and inside each envelope was a crisp, signed check. Great news! Chris is really excited because he has received payments from Bill and Jennifer. He's finally getting paid for his hard work and it's going to be a great feeling to see that money in his QuickBooks Online accounts. He doesn't have QuickBooks Payments set up, so he must manually record the received payments. We've seen how important using Undeposited Funds in the right way is for clients, so don't be afraid to make extra sure they understand how to record payments using an Undeposited Funds account. The key message is that by holding payments received in Undeposited Funds, clients are creating a single bank deposit for multiple payments, making it easy for them (and you) to match the bank register with their bank statement. About Undeposited Funds Just to recap, tell your clients to think of the Undeposited Funds account as an envelope where they keep their checks until they take them to the bank. It's a necessary step so that the QuickBooks Online Bank Register matches the deposits on the monthly bank statement. The best way to see how it works is to help Chris to record the checks he's received as Undeposited Funds.Chris has the checks from Bill Gallinger and Jennifer Martin, so these are payments he has received but not yet deposited in the bank. The first step is to record them as received payments in QuickBooks Online. Watch the video to see how it's done. The individual steps are below for you to follow. Let's take the shortcut QuickBooks Online has provided so we can get this done quickly and efficiently. Go to the + New button and select Receive Payment Select the customer from the drop-down. In this case, it's for Chris's first check from Bill GallingerNotice how you see a list of any outstanding invoices for Bill Gallinger. Change the payment date to today Select a payment method, in this case it's a check Enter a reference number: 1234 Make sure the Deposit to account is Undeposited FundsTip: This payment is in response to an invoice, so we have another step to do, which is to match the payment to the invoice. Check the box next to invoice 1001 to apply the payment to the invoice. It's the one for $1224.69 Select Save and newThe next received payment is for Jennifer Martin, so select her from the customer drop-down menu.Once again, the active invoice appears, and we can select it. Change the payment date to today's date Select a payment method. In this case, it's a check Enter a reference number: 12345 61 | P a g e Make sure the Deposit to account is Undeposited FundsCheck the box next to invoice 2 to apply the payment to the invoice. It's the one for $533.13. Select Save and close Recording a deposit Now Chris is ready to head to the bank and deposit the checks. At this point he's really excited, because the payments from Bill and Jennifer are about to hit his bank account. However, he needs to update his QuickBooks Online account too, because those Undeposited Funds are, well, no longer undeposited—they're deposited. Let's see how we can help him put that right. Recording a bank deposit in QBO The key thing to remember here is that Chris received two checks that will make up one deposit. Watch the video to see how it's done. The individual steps are below for you to follow. Go to the + New button and look to the right Select Bank Deposit. It's under the Other category heading Select Account as Checking account Change the date to today The two payments Chris has received will show up under Select Existing Payments. Check the boxes for Bill Gallinger and Jennifer MartinNotice how the total amount of the deposit is the sum of those two checks, and this will be the deposit shown in the check register. Select Save and close Whic option best describes why an Undeposited Funds account needs to be used for receving multiple payments? - It's used so that the QuickBooks Online Bank Register matches a monthly bank statement The Undeposited Funds account is used so that the QuickBooks Online Bank Register matches a monthly bank statement. Best Practice Workflows Chris, like a lot of clients, is impressed by the potential of QuickBooks Online to make accounting tasks straightforward and efficient, saving him time so he can get on with making his business a success. He's very eager to investigate its potential and maybe he's getting a little overconfident. Time to check in and see how he's managing his day-to-day sales and expenses activities in QuickBooks Online. A quick call later and you've spotted what might be some clues that he could be improvising a little when recording his sales. Time for a catch-up meeting to get to the bottom of it all. Best Practice Workflows: QBO QuickBooks Online has many features that can help you and your clients. Combining QuickBooks Online features with good workflow habits can save time and make things really efficient for small businesses and their accountants! You've already learned how to use many of the basic transactions during Introduction to QuickBooks 62 | P a g e Online for Accountants, but it's great to encourage clients to use these same workflows, or, to put it more simply, to do things in the right order and in the right place in QuickBooks Online. If you coach clients to get into good habits from the start, it'll save them and you time, avoid confusion, and help everyone get on with business! In this lesson, we'll look at some common client issues around workflows—and the QuickBooks Online tools you can use to detect them. When Workflows Go Bad QuickBooks Online is a super-flexible product and there are several workflows that can get something done. Clients can also see the same information from different angles, (like seeing income from sales through the lens of the Sales Center) but also see that income and expense transactions flow through to financial reports. So, what's the problem? Sometimes clients do not follow the appropriate accounting workflows and then things get out of sync. This in turn reflects incorrect key financial data on the financial statements, and many times numbers do not add up when they are trying to reconcile. You may sometimes have to unravel a problem and show them the best way to get something done. Workflows Go Bad: The case of the misposted check Chris has received a check from his customer as a prepayment deposit on a wiring job that he will complete in the future. To record the deposits, he taps the + New button and selects Check in the Vendor column to record the payment. By doing this, Chris inadvertently creates a vendor instead of a customer and assigns Professional Fees as the category. The problem Sometimes clients get confused over terminology in QuickBooks Online. We'll pick this problem up later and see how it can be identified and resolved, plus look at how Chris can be helped to understand where he went wrong. Workflows Go Bad: The case of the transaction entered via the bank register Another client, Stacy, has been using Quicken to manage her personal finances for a while and she always enters her checks and deposits from the bank register. She is new to QuickBooks Online and notices that she can open the Bank Register and enter transactions the same way. Great! She navigates to the Bank Register by tapping on Accounting, then view register. She is feeling right at home because it looks almost exactly the same as Quicken. The first transaction she wants to record is a manual check she wrote to pay her sales tax from the prior month. She adds New Jersey Department of Revenue as a new payee, enters the amount, and selects New Jersey Department of Revenue Payable as the account category. So far so good! Or is it? The problem QuickBooks Online is a forms-based accounting program and transactions should be entered using the 65 | P a g e Estimates and Purchase Orders As Chris's trusted ProAdvisor, you're happy to help—and pleased he's happy to touch base before he dives in and you get that phone call when things aren't going well! Walk him through how he can use estimates as part of his business to order work materials for jobs and eventually to invoice when the work is done. With some coaching on basic workflows, Chris has thrived and business is great, but he's called you up to ask for some help with a new workflow that he wants to use. This week, Chris met with an important new commercial customer who is looking to have a new generator installed. This is a big job for Chris and the customer has asked him to provide an estimate of the job to submit to the company's board of directors for approval. Estimates and how to use them: Create an estimate Chris has priced the estimated labor and material costs for a new contract he is bidding for for All City Library, and he's ready to create the estimate in QuickBooks Online. Watch the video to see how it's done. The individual steps are below for you to follow. Open the Sales Center by selecting Sales then All Sales in the Left Navigation Bar Select the New Transaction button at the top right of the screen then select Estimate Select the customer, All City Library, from the Customer drop-down menu Enter tomorrow as the Estimate date and a date in two weeks' time as the Expiration date In the Product/services grid, enter the following:- 1 Commercial generator- 8 hours of installation labor- Miscellaneous item costs amounting to $295 Select Save and send Preview the Estimate in the send email screen Select Send and close Using an estimate to creat a purchase order Great news! All City Library has accepted Chris's estimate! Now he needs to change the status of the estimate to Accepted and order the generator from his supplier. Watch the video to see how it's done. The individual steps are below for you to follow. Open the Customer Center by selecting Sales then Customers from the Left Navigation Bar Select the Estimate box in the Money Bar. All City Library's Estimate will be displayed Select 1 Open Estimate in the Open Estimates column and then select Estimate #1004 to open the Estimate screen Select the down arrow next to Pending and change the status to Accepted Select the down arrow next to Create invoice and select Copy to purchase order Select OK when the pop-up appears The select Yes if another pop up appears On the Purchase Order screen, select Lang and Sons Electrical Supply from the Vendor drop-down list Select All City Library as the customer the Ship to field Type Standard shipping please in the Your message to vendor box Select Save and send to send the purchase order to the vendor Once the generator is received from the vendor, Chris can add the purchase order to a bill, check, or expense, depending on how he'd like to pay for it. Chris is going to pay for the generator using an expense transaction, so let's see how to do this 66 | P a g e Select Expenses then Vendors from the Left Navigation Bar Select the blue Purchase Order box in the Money Bar Find the purchase order for Lang and Sons and select the down arrow next to Create bill in the Action column, then select Create Expense The Expense screen will open and be pre-filled with the vendor's name Enter the payment date and select Add from the drawer on the right-hand side of the screen to add the details of the purchase order to the expense From the drop-down arrow next to Save and Send, select Save and Close Converting an estimate to an invoice Chris has completed the installation of the generator and it's time to bill All City Library. Watch the video to see how it's done. The individual steps are below for you to follow. Select Sales then Customers from the Left Navigation Bar Select the Estimate tile in the Money Bar Select Start invoice in the Action column for All City Library Select the invoice date and set the due date for the payment as two weeks from then From the drawer on the right-hand side of the screen, select add under Estimate #1004 Select Total of all estimates lines = $34,075.00 then select Copy to invoice Select Save and Send Select Send and Close And that's it! Chris has completed the entire sales workflow for the All City Library job. Way to go! Which of these statements is true of estimates in Quickbooks Online? - Estimates are non-posting transactions - Estimate data can be used to create a purchase order in QBO - Estimate data can be used to create an invoice in QBO Estimates are non-posting transactions. They can be converted to invoices once they are accepted and the work is done or the service is provided and, of course invoices are posting transactions.Estimate data can be copied across to create a purchase order in QuickBooks Online. This saves time and is a great workflow to teach clients. Credit memos and custmoer statements Sooner or later, all clients will come across an issue with a service or product that the customer isn't happy with. Credit memos in QuickBooks Online allow you or your clients to allocate credits to customers so that next time they are invoiced, the credit can be applied. There's even a way to set this up to happen automatically. You can also create a customer statement to show this has been done. Let's see how we can create a credit memo for Chris. Note that this method is just reducing accounts receivable. It's not refunding cash to the customer. For that, you'd issue a refund receipt. Why use credit memos? 67 | P a g e When a client is working on creating credit memos, they may have questions. Here are some common ones you might need to answer! Why use a credit memo instead of just editing the transaction? It's not best practice to change transactions once they've been sent to a customer—it can cause confusion and isn't great recordkeeping. This is especially true when the original invoice is in a prior period, because making a change would cause the books to become out of balance with the tax return and change previously reported amounts. Why not just bill for less on the next invoice? It's important to create a new transaction in QuickBooks Online for each exchange between the supplier and the customer. This provides clarity to the timing and sequence of events with a customer. It can also affect the timing and balances of sales tax liabilities and movement of inventory in and out of the company. Why not just refund in cash and not record? It's important to capture all transactions, paid in cash or not, to ensure that the client's records are complete. If you pay the customer back in cash and don't record the transaction, you will pay sales and income taxes on the sales transaction and receive no benefit from the return transaction deduction. Can QBO apply credits automatically? Yes! In the Advanced tab of Account and Settings, you can select a checkbox that will tell QuickBooks Online to automatically apply credits to existing or new customer invoices. Auto-apply is great for clients who have simple accounts receivable (for instance, just a few invoices per customer). Use it with caution with clients who have higher-volume or more complex accounts receivable workflows. Create a credit memo and apply it to a custmoer invoice Let's show Chris how to record a credit memo and then apply it to a new installation invoice. Watch the video to see how it's done. The individual steps are below for you to follow. First, Chris will need to create a credit memo for the damaged light fixture. Select the + New button then Credit Memo Select Jeffrey S. Jacobs as the customer Select Other Miscellaneous Materials as the Product Service and QTY 1 and rate $49.95 for the malfunctioning light fixture Select Save and CloseNext, Chris will need to create a new invoice for the new light fixture. From the + New button, select Invoice Select Jeffrey S. Jacobs in the customer list Add a new product item: Avalon Light Fixture It's one item at $49.95Next, Chris will need to manually apply the credit to the new invoice unless he has Automatically apply credits selected, in which case QuickBooks Online would prompt him to apply the existing credit memo to the new invoice. See the ProAdvisor Tip at the end of the lesson for how to do this. To manually apply the credit: 70 | P a g e In the Vendor Credit screen, select Lang and Sons from the Vendor drop-down The date of the credit is today so we can leave it as it is Select Generator - 3500 Watt from the Products and Services list under Item details Add a note explaining the credit The quantity is 1. Add the rate, which is $500, the credit amount or the full price of the generator Add the customer that the generator was ordered for, Jaime Sullivan In the memo field, add Credit issued by Sam Select Save and closeBack in the Expenses Center we can see the original bills, plus the Vendor Credit. Now let's apply the Vendor Credit to a bill. On the row of the first bill for the generator, select Mark as paid from the drop-down next to the Schedule payment button. This is the one Chris returned If we scroll down, we can see that the Vendor Credit has already been applied to the total outstanding amount ($1,000 for two generators), reducing the amount payable to $500. Chris will be paying for the second generator by check which he will give to Sam later, so we'll record that payment later. Which of the following statement are true of Vendor Credits in QBO? - Vendor credits post as a debit to decrese accounts payable - Vendor credit can be linked to a cash refund, when the cash is deposited Deposit Transactions In QuickBooks Online you can easily categorize deposits like refunds or proceeds from loans so that they're not confused with sales income, and so that taxable and nontaxable income are separate and in the right place. Let's look at how this is done. Understanding Deposit Transactions Along with grouping existing payments in Undeposited Funds into deposits, deposit transactions are also used for adding new deposits for activity not related to sales transactions, such as: When a company receives funds from loan proceeds or contributions of cash from owners When companies receive a refund from a vendor and want to record it directly against the expense account or to a Refunds Received income account When a company doesn't record income using sales transactions (invoices or sales receipts) and wants to record deposits directly to income accounts When an employee reimburses the company, and the reimbursement needs to be recorded against the Employee Loan receivable account When there is a tax refund. This screen is where you record it in the Tax Refunds account Chris's SBA loan check is a good example of the first category. Put simply, this is money into the business that is not subject to sales tax or income tax and that doesn't have to be matched to a sales receipt or invoice in QuickBooks Online. It does, however, need to be recorded and categorized to the appropriate account on the Chart of Accounts. You can add multiple funds to the same deposit. 71 | P a g e Recording a deposit transaction Chris needs to record the deposit he made at the bank for the loan proceeds—but he needs to make sure it's in a separate category from his sales income. Let's see if we can help. Watch the video to see how it's done. The individual steps are below for you to follow. Go to the + New button, and in the menu, select Bank Deposit, just like we did for recording the sales deposits Add a date: 09/30/2020 Specify the account as Checking In the Add New Deposits section, enter deposit detail: Received From: Bank of Anytown For account, select SBA Loan Payable. Note that this is a liability account, so this deposit will not be classified as income Add the description. Make it Proceeds from loan Payment method is Check. Enter the insurance company's check number, 5487, as the reference number The amount should be $25,000.00 Now select Save and Close Which of the following would be a suitable situation for recording a new deposit transaction like we've just seen? - You receive a tax refund from the IRS and need to record it - You receive a cash back payment from a vendor for ordering in bulk A tax refund or a cash back payment would be a perfect example of the need to record money coming in that isn't matched to an existing payment. Other examples of when you might enter a deposit transaction include employees paying back personal expenses or paying back funds loaned by the business. Quickbook Payments You've already helped Chris enable QuickBooks Payments and now it's time to show him how easy it is for him to record electronic payments made by a customer! Payments via invoices and sales receipts Remember when Chris was set up to accept digital payments through QuickBooks Payments, we asked him to select the bank account where customer payments would be deposited. When Chris creates an invoice, he can select the way he'd like to get paid (credit card or ACH or both) and then send the invoice via email to his customer. When the customer selects the View and Pay button to view the online invoice, they will then see the option to select the Pay button. The great news is that any payment made here will be recorded automatically in QuickBooks! Sometimes Chris will be paid by his customers at the time of sale and won't want to create and send an invoice. In these cases, he just needs to create a sales receipt that will allow him to record both the sale and payment on the same screen in QuickBooks. He can then email the sales receipt to his customer, so they have a record of the sale. Creating a sales receipt 72 | P a g e Chris begins the workflow by selecting the + New button and then Sales Receipt in the Customer column. After completing the customer and sales details, he'll select Credit Card as the payment method. Chris can then enter the customer's card details and can send the receipt via email or print it out. It's that simple! Remember from our earlier advice about setting up QuickBooks Payments. Your clients need to sign up for QuickBooks Payments themselves because as the process forms a contract. If you were to sign them up you'd be signing the contract— and not your client. How QB Payments work Step 1: Invoicing Step 2: The customer receives the invoice - Tap Review and Pay Step 3: The payment process Step 4: Payment confirmation Step 5: Payment notification and updates -The payment status will automatically be updated in QuickBooks Online. There's no need for Chris to record the payment or the deposit—QuickBooks Online does it all for him! Recurring payments If Chris has a customer's credit card or bank account information on file and has authorization from the customer to charge a recurring amount, he will be able to create sales receipts that automatically book the sale in QuickBooks Online and deposit funds into his bank account. For Chris, this is a great way of automatically billing and getting paid for services that are, say, monthly maintenance plans or service agreements. Watch the video to see how he gets it done. His individual steps are below for you to follow. Select the Gear icon Select Recurring transactions Select New From the Transaction Type drop down, select Sales Receipt Select OK Specify a name for the template that describes what the recurring charge is for, in this case MaintenanceThen complete the rest of details as you would normally, in this case The Type is Scheduled for 3 days in advance The Customer is Bill Gallinger The Interval is Monthly on the 1st day of every month Select a Start date: 1st of November 2020 For End, leave as None Select Credit Card as the Payment method Then add the Product/Service you're billing the customer for: Installation Labor Finally, select Save templateThat's it. Chris will now get paid on the first day of every month for the regular work he completes for the customer. Instant Deposits 75 | P a g e Then select Save and Close Enter a debit amount of $5,000 and enter a description to record a contribution of equipment On the next row, select Owner's Equity from the drop-down list. The credit should automatically be populated with $5,000, matching the debit above Enter a description matching the debit above Select Save and new or Save and close Adjusting journal entries: Accrued expenses These are expenses you've accrued but haven't paid yet, like a loan interest or accrued payroll. Accrued expenses appear on the Balance Sheet as liabilities. Adjusting journal entries: Deferred expenses This is where you've paid for something but not yet realized the benefit. An example of a deferred expense would be if you pay for your insurance a year in advance. Deferred expenses appear on the Balance Sheet as assets. Adjusting journal entries: Accrued revenues This is where you've earned the revenue, but the customer has not yet been invoiced, a common practice in many industries that work on long-term contracts. These appear on the Balance Sheet as accounts receivable, which is an asset account. Adjusting journal entries: Deferred revenues These occur when you've been paid in advance by a customer but you haven't finished the work yet. This appears on the Balance Sheet as unearned income, a liability. Adjusting journal entries: Non-cash transactions Not all expenses are cash expenses. Some things represent expenses that don't have a cash effect on your business. Depreciation and allowance for doubtful accounts are two examples of common non- cash transactions. If regular adjustments aren't recorded to reflect these activities, it's easy to get a skewed picture of a company's financial position. Here's a quick example: Chris has an annual loan interest payment due in June and no liability has been accrued for it during the year. Chris could easily overestimate his available cash if he doesn't keep track of this growing current debt. His profit for each month will also be incorrect. Also, when he makes the annual business insurance payment and it's not accrued, the monthly insurance expense will be reflected in the wrong accounting period. As an accountant, you can set these adjusting journal entries to post automatically using the Recurring Transactions feature in QuickBooks Online. That way, you know that most (if not all) of the necessary adjusting entries are reflected when viewing monthly financial reports. To mark a journal entry as adjusting, just enter the journal entry as normal and check the Is Adjusting Journal Entry? checkbox. When would you use an adjusting journal entry? 76 | P a g e - To account for depreciation of an asset, like a company car or van over several years - To account for a loan payment due in the next financial year An adjusting journal entry is used to account for expenses or income not already recorded by other accrual or cash transactions. In addition, like the van depreciation, it can divide amounts between two or more accounting periods. Pay down a credit card As finance professionals, you know that categorizing transactions in the correct accounts is vital to keep the books tidy and financial statements accurate. Sometimes, our clients aren't so careful. A common problem is when clients miscategorize credit card payments or add them via their bank feed.QuickBooks Online is always looking for ways to help clients follow the correct workflows. The new Pay down credit card option is another example of this. It makes it easy for non-accountants to categorize credit card payments in the correct account, keeping their balances and reports tidy and accurate. Why use the Pay down credit card feature? In the past, clients could record their credit card payments in a couple of ways: By creating a transfer transaction and matching it from the bank feed By writing a check But they aren't always sure how to categorize the payment correctly. A common mistake is to categorize payments to a credit card to an expense account rather than to the credit card liability account. This leads to incorrect balances in both the Banking Center and on the Profit and Loss and Balance Sheet.The Pay down credit card feature makes it simple to follow the correct workflow. What's more, it uses client- friendly language to help them make the right choices.Clients still have the choice to pay by check if that's what they prefer. How to use the PDCC? Craig received his monthly Mastercard credit card statement. He has enough in his checking account to cover it, so he goes ahead and uses his online banking to make the payment. Next, he needs to update QuickBooks Online to record the payment. Watch the video to see how it's done. The individual steps are below for you to follow. Select + New, then select Pay down credit card in the Other column Select the credit card account that is being paid. In this case, it's Mastercard In the Payee field, again, select Mastercard Enter how much was paid Enter the date of payment Select the account that the payment was made from. Notice the language is really client-friendly here: "What did you use to make this payment?" Notice that you also have the option to record making the payment by check. Plus, just like with other transactions, you can add memos and attachments. Select Save to record the transaction Now that's it done, QuickBooks Online will work its magic. But as a finance professional, you might want to peek under the hood and see what's happened in the background. Select the More button at the bottom of the transaction and choose the Transaction Journal 77 | P a g e Here, you can see the Checking account being credited and the credit card account being debited. Just as it should be, so that the financial statements will be spot-on! Which two common client issues does the new Pay down credit card feature aim to resolve? - Duplicate entries - Payments categorized to the wrong account Yes, with a specific function to pay down a credit card and clear client-friendly language that reflects which credit card to pay and from which account, you should see fewer duplicate entries and miscategorized payments to credit cards when you come to check your client's books! Transfer Transfers between different balance sheet accounts are easy to set up in QuickBooks Online, once the accounts themselves are set up. In this lesson, you'll see just how easy transfers are to set up and how they can be set up to recur. As you'd imagine, QuickBooks Online will keep track of every transfer automatically, whether it's manually configured or recurring. What is a transfer? Companies often transfer funds between company-owned bank accounts. Perhaps the company is moving funds from the general operating account to the checking account used for payroll, or from a savings account to the checking account. Perhaps the company transferred funds from the company checking account to pay down the company credit card. Here's a summary of the transfer functionality in QuickBooks Online: The transfer screen is used to move funds between two balance sheet accounts The transfer screen is not used to record income or expense A transfer is a 1:1 transfer of funds, there are no splits allowed There are no customers, vendors, employees, or Products and Services items involved. These fields are not available on the transfer screen You don't use the Transfer feature to make transfers between your bank account and your vendor's bank account Recording a transfer A transfer of money between accounts is not an income or expense, so you and Chris will need to use the Transfer screen. Watch the video to see how it's done. The individual steps are below for you to follow. Chris needs to set up a transfer of $200 into his savings account. Navigate to the + New button Find the Transfer link, select it to go to that screen Select the account from which you are transferring funds for Chris. We need to transfer out of his Checking Account Select Savings account, which is where Chris wants the funds to be transferred Chris wants $200 to be transferred Fill in the date. Make it today's date Select Save and close 80 | P a g e Best practice bank feed workflows: Review Craig's been doing a great job of following the best practice sales, expenses, and vendor workflows that you learned about in modules 3 and 4. This means that his bank feed is in great shape. When he reviews his bank feed, for the most part he wants to match transactions. This way, he is linking the bank feed item to a transaction that's already in his QuickBooks Online. Once he's done this, there might be a few left over that QuickBooks Online can't find a match for. These could be expenses and/or deposits he hasn't recorded and that aren't posted in QuickBooks Online already. But he can go ahead and add each directly from his bank feed. This will create new posting transactions in QuickBooks Online straightaway. Manually adding transactions Let's take a look at how you could help Craig to manually add some more items from the bank feed into QuickBooks Online. Watch the video to see how it's done. The individual steps are below for you to follow. As before, from within Craig's QuickBooks Online account, select For review to go to the Banking screen Select the entry for $18.08, an expense Craig paid to Mahoney MugsThe entry will expand and you'll see the transaction details, but you need to categorize this expense. It's currently marked as For Review because the bank wouldn't know how to categorize it. Select the Category drop-down list and scroll down to select Advertising Now select Add to commit this to QuickBooks Online Why is there a cuplicate transaction? Instead of matching to an existing transaction, they added one—and this created identical transactions for the same amount. ProAdvisor advice: Always match first and check all bank and credit card transactions to make sure the transaction is not hidden someplace else Once this has been confirmed, add is the second option Why are my invoices still outstanding? Instead of using the correct sales workflow, which would be to receive a payment against the appropriate customer open invoice, they just added a new deposit in the bank feed. This caused two issues: Open balance on invoice Duplicate income deposit ProAdvisor advice: They should have followed the correct sales workflow. Receive payment against the corresponding customer invoice and save the deposited amount to Undeposited Funds Record the deposit transaction based on what actually was deposited into the bank Match the bank feed deposit to the actual QuickBooks Online deposit transaction Why are my expenses getting duplicated? 81 | P a g e Instead of matching checks through banking with expenses already entered as checks in QuickBooks Online, they just added new expenses through bank feeds. ProAdvisor advice: They should have followed the correct expense workflow. Create a check expense in QuickBooks Online Match the bank feed check transaction to the QuickBooks Online check expense Why do I still have transactions in the bank feed that are not matching with my transactions in QBO? They most likely typed a date incorrectly in the original QuickBooks Online transaction so the transactions are not getting automatically found or recognized in the bank feed. ProAdvisor advice: Select find match to locate the transaction to use. Do I need to manually enter prior period transactions, expenses, and deposits if I haven't used QBO before? It's time-consuming to enter a year's worth of historical checks and deposits using the transaction forms. ProAdvisor advice: The simple way to recreate prior period accounting data for your client's QuickBooks file is to: Link your client's QuickBooks Online to their bank account and select the appropriate period ranges, orPerform a manual bank import for the exact period you are recreating in QuickBooks Then select Add for each of the transactions from the bank feed to create the transactions in their QuickBooks Online Correctly categorizing income and expense transactions is key to making certain the prior period data is accurate and ready for the client's review. Craig calls with a problem. He can see a duplicate transaction for some job materials he bought at Hicks Hardware. What might have caused this? - Instead of matching the transaction from his bank feed, he added it By adding the transaction from his bank feed instead of matching it to an existing transaction, he created identical transactions for the same amount. ProAdvisor advice: Always Match first and check all bank and credit card transactions to make sure the transaction is not hidden someplace else Once this has been confirmed, Add is the second option Manging receipts and bills QuickBooks Online makes keeping track of receipts and bills much easier for you and your clients. Users can scan, upload, or even email receipts and bills to QuickBooks Online. Receipts can then be matched to existing expense transactions or used to create new ones. Clients can even do this on the move via the mobile app. The benefits of manging receipts and bills in QBO 82 | P a g e Receipt management has always been a challenge for clients who are busy, on the road, or just a little less organized than their ProAdvisor would like them to be. In many cases, receipts and bills are physical items: easy to lose or misplace or just push into the glove compartment to file later. They can also be damaged or torn, or fade over time, making them illegible. And then there's the actual chore of managing and storing them. This usually means attaching hard copies to credit card statements or putting them in envelopes, which get filed into boxes. For a busy business owner, this process often takes a back seat to other tasks like winning a new contract or making a sale. When period end rolls around, your client's receipts and bills have piled up and it takes a lot of work to make sense of things. Often that work falls on your shoulders rather than the client's. The new Receipt Capture feature in QuickBooks Online means receipts and bills can be scanned, snapped, and added and managed in QuickBooks Online. And what's more, it can be done in all subscription levels, from QuickBooks Online Simple Start through Advanced. The Receipts tab in the Banking Center is the home of adding and tracking receipts and bills. Once a receipt or bill is in the Receipts tab, you can review, edit, add, or match it. We'll look at this in detail in a moment. The Receipt Capture Workflow Logging bills and receipts and matching them to transactions is similar to the banking workflow and can be viewed within the Banking Center. There are three ways to capture bills and receipts so that they can be matched to transactions and added to the bank feed. RCW: Direct File upload If you have receipts stored on your computer already (whether they have been downloaded from an email as an attachment or scanned directly into your files), you can drag and drop them directly into QuickBooks Online. To do this, simply use the drop box on the Receipts tab. RCW: Forwarding by email If bills and receipts have been generated or sent to you or your client via email, you can set up QuickBooks Online so that you can forward them directly to your client's QuickBooks Online account. Each company can have one unique customizable email address, so you can make sure every receipt and bill gets forwarded to the right place. Once the email has been set up, you can forward bills and receipts as attachments (if you want to forward several at once) or within the body of an email (if you're only forwarding one receipt per email). If you accidentally send a receipt to an email address that isn't registered with QuickBooks Online, you'll get a notification email. RCW: Via the mobile app The QuickBooks Online mobile app is especially handy for small receipts like café receipts or card transactions in stores. Simply open the app, take a snapshot of the receipt, and the file will be uploaded to your account. 85 | P a g e Just remember to use the unique forwarding address for each client that was created when this feature was enabled in their QuickBooks Online account. Your client has taken a photo of a receipt for a new expense via the mobile app. They haven't yet entered the transaction into QBO. What is the next step in the receipt capture process? - Got to the For Review tab in Receipts The app has loaded the transaction into QuickBooks Online for you. To make sure all of the information has been pulled through or to add further information, you would head to the For Review tab in Receipts by selecting Add. Excluding bank transactions Craig's got the hang of working with the bank feeds and can add transactions that aren't already in QuickBooks Online. He's amazed at how helpful the matching feature is. But guess what? He's found some transactions that aren't a match and he doesn't want to add them. When to exclude transactions Excluding a transaction means removing it from the bank feed and not recording it in your QuickBooks Online register. A good example of when you might do this would be if the bank feed brought in a duplicate transaction that had already been added to QuickBooks Online. This may happen if you import transactions but are current on your reconciliations. The banking feature does not match imported transactions against reconciled transactions. To exclude a transaction for Craig from the For Review tab, select the checkboxes to the left of the date for the transactions you want to exclude. Once you're done, select the Batch Actions drop-down and select Exclude Selected. The transactions move to the Excluded tab. You can see what you've excluded in the Excluded tab. These transactions haven't been added to QuickBooks Online, so they won't appear in any account registers or report. Excluding and reconciliation Excluding is about avoiding errors. The goal of reconciliation is to prove that the transactions in the register match the transactions that have cleared on the bank statement. If a duplicate transaction is imported into the register, the register will not reconcile with the bank statement. This will result in incorrect financial reports. But what if you accidentally exclude a transaction and you'd like to include it again? Choose Banking from the Left Navigation Bar Select the Excluded tab Select the checkboxes for the transactions you'd like to include again Select the Batch Actions drop-down, select Undo, and it will bring the specified transactions back into the For Review tab for you to work with. You can then add, categorize, or match and accept the transactions. How to exclude a transaction Craig's been working on his bank feeds and he's noticed two transactions from Squeaky Kleen Car Wash that cancel each other out. An accidental duplicate payment made in May was returned in August. 86 | P a g e Because no goods were exchanged, Craig has asked that these be removed from his bank feed. Because errors in the bank feed like these will affect future reconciliations, you can exclude these transactions for him. Watch the video to see how it's done. The individual steps are below for you to follow. Select Banking from the Left Navigation Bar Select the check box next to the transaction for Tania's Nursery for $108.09 Select Exclude in the banner at the top The transaction has now been removed from the For Review tab in the bank feed Select the Excluded tab to see these transactions. From here, you can manage them further if you need to Reinstating excluded transactions If you exclude a transaction that you later require in the bank feed, you can easily reinstate it. Watch the video to see how it's done. The individual steps are below for you to follow. Return to the Banking Center Select the Excluded tab Select the transactions you wish to reinstate Using the Batch actions drop-down, select Undo Select the For Review tab to see your transactions back in the bank feed Which is the best example of when you might need to exclude some transaction from a bank feed? - Your bank mistakenly imports transactions more than once when first set up The best example is if your bank mistakenly imports transactions more than once. If this happens, your statement won't match the already reconciled transactions, so you'd need to identify and exclude any duplicates. Creating simple bank rules Craig wants to make it easier to manage the transactions he imports from his bank into QuickBooks Online. He's heard that he can set up rules so bank transactions can be fast-tracked by being automatically categorized and assigned to payees. This automation will save him time he could use running his business. Let's hope you're up to speed with this because he'd like your help setting up some bank rules! Matching and adding transactions from a bank feed is pretty straightforward, and an important part of keeping Craig's QuickBooks Online registers in line with the activity recorded by his bank. In this lesson, we'll look at how setting up a simple bank rule can allow QuickBooks Online to take the strain and help manage transactions automatically. About bank rules Bank rules automate the categorization of the transactions in the bank feed, including assignment of the transaction type, category, payee, class, and location. They can also be used to automatically split transactions. Rules can be prioritized, copied, edited, and exported. You can even create bank rules to add transactions to the register automatically. 87 | P a g e Creating a rule Now let's take on the challenge Craig has given us: to set up a simple bank rule just so he can learn how it's done. He'd like QuickBooks Online to automatically categorize his equipment rental expenses. Watch the video to see how it's done. The individual steps are below for you to follow. Open Banking from the Left Navigation Bar We're in the Banking Center now, so select the Rules tab at the top, just above the details about Craig's checking account Select New Rule Add a description. Make it A Rental and this rule is for Money Out in all bank accounts Add a condition: select Bank text from the first drop-down Select Contains from the second drop-down Type A Rental in the final box. This means that anything with A Rental in the text of the transactions will qualify for our rule Make transaction type equal Expense. This means that the rule will create an expense transaction Select the payee. Select Add New and type A Rental Select the category. Make it Equipment Rental Return to the Payee field and select the new vendor A Rental Select Save Now go back to the Banking tab Select Categorized You'll see the $800.00 and $1,200.00 transactions for A Rental have a Rule icon attached to them, to show that they have been categorized as per the rule we just set up. Notice that the transactions also have an Auto-add icon attached. This is the default setting when creating a new rule and will automatically add the transactions to your QuickBooks Online. Note: The Auto-add setting can be turned off while creating the rule, or at any time by editing the rule. If a transaction meets the criteria of multiple rules, which rule will be applied? - The one listed first Where multiple rules apple to a new transaction, the first rule in the list will be applied. Rule Tip On the rules screen, select Automatically add to my books if you want the rule to automatically record transactions that meet the defined criteria without having to select the button in the For Review tab. Transactions that have been automatically added by a rule will have a green Rule icon next to them in the In QuickBooks tab. Reconciling the bank Cindy, owner of Cindy's Bee-uty Bar, has had a great month and she already has enough orders to give her a great quarter. But she knows that she needs to pause and think at the end of each month and make sure her accounts are reconciled. Reconciliation takes time and attention. Cindy remembers her former process, where she spent hours 90 | P a g e The all-important reconciliation number. You need to try and get the difference to zero. When you add or remove a checkmark to include or exclude a transaction, we update the difference. Your client's books and bank agree when the difference is $0.00. Edit info If you need to edit the statement ending balance or date, select the Edit button to make the change. Saving your reconciliation If you want to save the reconciliation and finish it later, you can select the Save for later button. Once you reach the magical zero difference, this button will change to Finish now. This will complete the reconciliation. There are other options in the drop-down. Select transactions Any transactions added or matched through bank feeds will automatically have a checkmark in this column. Compare the transactions to the bank statement and if they show up on the bank statement, check them off. Once everything that is on the bank statement is selected here, the difference should be zero. Beginning balance discrepancies QuickBooks Online has smart learning that will help you and your client with some of the most common causes of accounts not reconciling. Beginning balance discrepancies (where the beginning balance you see on your client's bank statement doesn't match the beginning balance when starting a bank reconciliation) should be fixed before you reconcile. QuickBooks Online alerts you to these beginning balance discrepancies and gives you a link to run a discrepancy report straight from the reconcile screen. The discrepancy report finds any transactions that were: Changed after they were reconciled, if the change affected the beginning balance of the account Deleted after it was reconciled Manually reconciled in the register by changing the reconciliation status to reconciled (R) Unreconciled in the register by changing the reconciliation status from reconciled (R) to cleared (C) or no statusWhen you open the report, QuickBooks Online will also give you some guidance on how we think you can resolve the transactions. Once you've resolved the problem transactions and the Total Discrepancy Difference is zero, you're ready to reconcile. Rogue transactions QuickBooks Online also uses smart learning to help you identify if a rogue transaction is preventing you from reconciling. For example, it can help you identify if a transaction date is incorrect (say if the posting date was manually entered and has a clearing date that differs from the bank data). QuickBooks Online will identify these hidden transactions and give you a link to display them, making it easy for you to go through and include the ones you need to hit the magic zero difference! This smart learning is available to QuickBooks Online accounts that have been connected to online banking, because it relies on the cleared bank feeds' transactions. 91 | P a g e Chaning a reconciled transaction Now, as with most things in QuickBooks Online, if Cindy or any client makes an error and needs to fix it, it's pretty easy to adjust or roll things back. Even transactions that you've reconciled can be changed. Generally, you wouldn't change a reconciled transaction, but sometimes errors are made inadvertently. Watch the video to see how it's done. The individual steps are below for you to follow. Having noticed that she wrote a check for the wrong amount to a vendor, Cindy has gone into the account herself and updated the amount on the check after you have reconciled. Let's pretend we're going to attempt the next month's reconciliation. Select Accountant Tools icon and then ReconcileYou should see an alert warning you that this account isn't ready to reconcile, highlighting that our beginning balance is off by $100 (the edit we made earlier) and giving a link to help us fix it. Select the linkThe link will launch a Reconciliation discrepancy report screen highlighting the problem we created. Let's fix that problem. Select the line in the report and edit the amount back to $422.36, then select Save You may get a warning pop-up asking if you're sure, but hold fast, we're doing good here, so select Yes The entry should disappear and the total discrepancy should be zero Select Done and you're all set for next month's reconciliation Undoing a reconciliation If things get messy, it's useful to know how to undo a reconciliation. However, it's usually better to use the discrepancy report to fix reconciliation errors that we looked at a moment ago. You may undo a reconciliation if the reconciliation was forced, meaning it was saved even though the difference was not zero. That causes QuickBooks Online to make an adjustment. Undoing the reconciliation allows you to start over so that you can find the discrepancies. In this activity, you'll walk through the steps involved in undoing a reconciliation. Watch the video to see how it's done. The individual steps are below for you to follow. From QuickBooks Online Accountant, open Cindy's client file Select Accountant Tools, then select Reconcile Select the History by account link On the Reconciliation history screen, select the down arrow next to the View report then select UndoQuickBooks Online doesn't ever want you to do this by accident so you'll get two warning pop-ups checking you're sure you want to undo the reconciliations.If you don't want to undo all your hard work, select Go back. Recurring transactions Recurring transactions can be set up for a variety of different reasons in QuickBooks Online. The beauty of this feature is that it's flexible enough to meet lots of business needs for different types of businesses. Helping your clients creat recurring transactions Recurring transactions in QuickBooks Online can be set up to manage pretty much any of the first transactions in any workflow, like sales receipts, invoices, bills, journal entries, checks, deposits, or expenses. 92 | P a g e It's a great way to automate money-out transactions, like rental or insurance payments, that are paid at regular intervals and fixed amounts. On the sales side, when Craig provides a regular service at a fixed price for a customer (such as weekly lawn mowing or monthly tree trimming) he can invoice them automatically using recurring service charges. Craig can even set a recurring charge to a customer's credit card or bank account (ACH) using a sales receipt, with advance customer authorization. When setting up an invoice for a recurring transaction, you have the option to include unbilled charges and automatically send emails. If set up, Craig won't have to remember to generate invoices every month. This will eliminate all the reminder sticky notes he keeps attached to his computer screen. His attention can be focused on his business instead. More advanced recurring transactions can be set up for non-posting transactions, such as purchase orders or estimates. Notice that the transaction does not have to be scheduled. So, for example, if your purchase order typically contains the same items purchased but you don't order on a scheduled basis, select Reminder or Unscheduled from the Type drop-down list. As an accountant, you can even set up recurring journal entries to reclassify deferred revenue or prepaid expenses. Automating processes with recurring transactions can save time and headaches when you've got regular predictable activities, whether they're expenses or sales activities like invoices. However, the automation requires some involvement to make sure invoices for canceled or held work don't go out automatically! Which of these recurring transactions could be used if Craig needed to set up a monthly recurring customer charge including payment? - a recurring sales receipt The great thing about QuickBooks Online's recurring transaction functionality is that it allows you to create them to match your circumstances and needs—and the same goes for Craig's. In this case, he can set up a regular, recurring sales receipt for landscaping services carried out each month. Remember, a sales receipt means you get paid at the time of sale, so provided Craig is signed up for QuickBooks Payments and has prior authorization to charge the customer, you can set up the payment as part of the recurring sales receipt transaction. The other two examples are great illustrations of other uses of recurring transactions, just not suitable for Craig's needs at this time. Creating a simple recurring transaction Craig paid his first month of fuel costs by check, but he is on a monthly budget plan. Because this is a regular payment he needs to make, let's help him set up a recurring transaction. He's already set up for his bank to make the payment on his behalf each month. Watch the video to see how it's done. The individual steps are below for you to follow. Select the Gear icon Select Recurring transactions Select New From the new Transaction Type drop-down list, choose Expense and select OK On the new screen, enter Chin's Gas and Oil: Budget Plan as the template name. It's best practice to list the Name (Vendor/Customer/Employee) in the Template name. This makes it easier to identify your 95 | P a g e This option opens all the features of QuickBooks Online. It offers more comparison reports for company financials. Unlike Essentials, you can run reports relating to location and class, purchasing and inventory, time activities, and more. Now select the Report Differences by Subscription Level link for your copy of the reporting levels. Basic report: AR Accounts Receivable (or A/R) reports in QuickBooks Online allow you or your clients to see who owes the business money and how much they owe. Reports include Customer Balance Summary and Detail, A/R Aging Summary and Detail, Collections report, Invoice List, and Statement List. Managing the amount of money owed to a business can be hard. Using A/R reports helps Craig manage his cash flow more efficiently by making the details of open customer balances visible.What is an A/R Aging Summary report?The A/R Aging Summary report lists each customer with an open balance. It lists the open invoices in different columns based on whether they are current or how long they are overdue: 30, 60, or 90+ days. By running this report, you and Craig can see who owes money and their payment terms. Basic reports: AP Accounts Payable (or A/P) reports in QuickBooks Online allow you and your clients to see what the business owes and when payments are due. Reports include A/P Aging Summary and Detail, Vendor Balance Summary and Detail, Bill Payment List, and Unpaid Bills. For your clients, managing cash going out of the business is crucial. They can gain insight into which vendors to pay and when by using these reports and, as a result, manage their cash flow.The A/P Aging Summary This report summarizes the status of unpaid bills and unapplied Vendor Credits. It serves as a quick glance at which vendors are most overdue. Why would you run one of these reports? You can use the A/P Aging Summary to help Craig understand how to pay vendors strategically, instead of just paying the first ones he thinks of or those he likes best! For example, if Craig has a vendor who is making finance charges, you can encourage him to pay that vendor first rather than a bill that is still within payment terms. That way, Craig can maintain his pool of available cash and not run short when he needs to buy supplies essential for completing current work. Basic report: P&L and Balance Sheet The Profit and Loss and Balance Sheet are two other essential reports that help Craig assess his financial performance. Profit and Loss is also referred to as the Income Statement. An Income Statement summarizes the amount of financial activity associated with each income or expense account for a specific period of time, so the business can assess whether it is operating at a profit or a loss. To run a Profit and Loss reportIf you were looking at Craig's Landscaping and Design business account, you would navigate to the Reports Center and find the report under Business overview. On the Profit and Loss Report screen, there are options to customize the report to suit your client. Within the report period, you can change the display of columns and compare with another period. You'll find an example under the Tools section, where you can download copies of these reports. 96 | P a g e To run the Balance Sheet report: From the Reports Center, under Business overview, you'll see Balance Sheet. The reporting period for an Income Statement differs from that of a Balance Sheet. A Balance Sheet summarizes the financial position of a business at a single moment in time; that is why it's commonly referred to as a snapshot of the business. This report reflects whether the assets that the business owns are enough to offset its liabilities and leave a net equity balance after all liabilities have been paid off. As above, you have options to sort and filter this report to suit your client's needs. You can download and view this report in the Tools section. Based on this Accounts Receivable Aging report, and the fact that Craig offers 30-day terms, whom would you advise Craig to contact for immediate payment if he is looking to collect any balances over 60 days past due? Red Rock Diner - behind on payment - The Red Rock Diner is way behind on payment. The A/R Aging report can help Craig get on top of who has gone beyond his terms and still owes for the work he's done. If he runs the report regularly, he can see who is immediately beyond the 30-day terms he specifies on his invoice and send a reminder on day 31 to keep on top of his debtors. Based on this Accounts Payable Aging report, and if all vendors offer 30-day terms, whom would you pay first? PG&E - The payment to PG&E is late. Craig needs to get on top of this and make the payment. If Craig runs this report regularly, he can see potential issues before they happen and take steps. For instance, you may have noticed there are three significant bills that will need to be paid in the next few weeks. Has Craig anticipated this and what will be the effect on his liquidity of paying these bills over a short period of time? The value of reports It is important that you work with your client to create value from his reports and build reporting packages Dan will find invaluable. QuickBooks Online adds value for your clients with powerful reporting features—you'll both want to get the best from them. P&L Report There are a few key reports in the end-to-end accounting lifecycle that will help you analyze the state of your client's business. Helping your client interpret the figures in their Profit and Loss and Balance Sheet will help them gain business insights and make sound business decisions. The Profit and Loss report is the best place to start because it's the report the client will be most familiar with. Profit and Loss summarizes the amount of financial activity associated with each income or expense account for a specific period of time. This will tell you whether your client is operating at a profit or a loss. By running a prior period Profit and Loss comparison report, you can reveal cash flow trends in spending and earnings from the business. 97 | P a g e Running a comparative P&L report Dan is concerned that his year to date hasn't been as lucrative as the previous year. To check this for him, you can run the Profit and Loss report and take a look at his accounts. You can run a Comparative Profit and Loss report from within the same report—there is no need to run two separate reports. Watch the video to see how it's done. The individual steps are below for you to follow. Enter the Report Center from the Left Navigation Bar Select Profit and Loss from the Business Overview section Set the Report period to This Year-to-date Check to make sure the date ranges from 01/01/2020 to today's date Select Previous Year from the Compare another period drop-down list and set the checkboxes to % Change and % Income Set the Accounting method to Accrual Select the Run report button Which 2 accounts, shown on the report, need more investigation? 4 & 5 - Rent and Lease have seen a significant decrease in value. You'll want to ask Dan why this is. Ask My Accountant is automatically registered as an uncategorized expense by QuickBooks Online. You will want to take a deeper dive into the transaction report with Dan to agree how each of these should be correctly categorized in the future. You should be looking for high decreases and uncategorized items and focus on those first. Analyzing the P&L report As part of your analysis of the Profit and Loss report, you will want to run through some top-level questions with your client. You're looking for discrepancies or things that look out of place, such as: Income: Does their total income look about right? Which income streams brought in more revenue? Is all their income categorized? Expenses: Are there any expense items in Ask My Accountant? Point out expenses that were different from prior periods and ask why Review key areas like revenue, gross profit, and net profit Let's take a look at how the conversation between you and Dan might go. The key metrics to consider when analyzing the Profit and Loss report are: This year to date 01/01/2020 To [date automatically sets as today] Compare another period: Previous Year Check % change Check % of income Accounting method: Accrual You'll see that some transactions will need reclassifying. We'll take a look at that in more detail in a future module.