QuickBooks. Premier 2017 Level 2. MasterTrak Accounting Series. Courseware

Transcription

1 QuickBooks Premier 2017 Level 2 Courseware MasterTrak Accounting Series

2 QuickBooks Premier 2017 Level 2 Lesson 1: Setting Up Data Files and Customizing Settings Lesson Objectives The objective of this lesson is to show you how to convert from a different (manual) accounting system to QuickBooks. Upon successful completion of this lesson, you will be able to: use the EasyStep Interview to set up your company data file enter the company information enter the data file start date set the administrator s password use the Add/Edit Multiple List Entries windows enter customers, vendors and inventory items enter opening balances set up data file preferences add and modify General Ledger accounts manually enter the opening balances for General Ledger accounts work with account numbers enter additional customers, vendors and opening balances work with Registers enter additional inventory items and balances Creating a New Company Data File Before you can use QuickBooks as your accounting software for your business, you must set up a data file. QuickBooks makes this process very easy for you with the EasyStep Interview, which will ask you a series of questions relating to your business and accounting policies. Once you have worked through the EasyStep Interview, QuickBooks will create all the ledgers and journals for you (and even the Chart of Accounts), based on the information you provided. QuickBooks makes the process easy with its extensive library of company account templates that represent almost every common type of business enterprise from accounting practices (that have to do their own accounting), construction companies, all types of retail businesses, to consulting services. By choosing one of these account templates, you can save yourself considerable time setting up the accounts, rather than doing this task manually. If your type of business is not included in the templates, you can choose the template that best matches your type of operation and modify it to meet your specific requirements v1.00 CCI Learning Solutions Inc. 1

3 Lesson 1 QuickBooks Premier 2017 Level 2 If you are converting your existing accounting system (which may be a manual system) to QuickBooks and are thinking about keeping the same chart of accounts, it may be easier to create the list of accounts from scratch. In Level 1 of this courseware series, you learned that QuickBooks uses the following account numbering system when it uses account numbers and a pre-defined chart of accounts: Assets 1000 to 1999 Liabilities 2000 to 2999 Equity (Capital) 3000 to 3999 Revenue 4000 to 4999 Cost of Goods Sold 5000 to 5999 Expense 6000 to 6999 Other Revenue 7000 to 7999 Other Expense 8000 to 8999 If you are using account numbers, regardless of whether you are using a template for your chart of accounts or you set it up yourself, you may change these numbers and the numbering system within the limitations set by QuickBooks to suit your own preferences and working style. If you are starting up a new company, the best approach is to use QuickBooks from the first day of business. If you decide to start using QuickBooks at some point during that first year, you should go back to the first day of business operations and enter everything into QuickBooks from day one. If either of these cases is true, the following paragraph will not apply. If your company has been operating for at least one year with your current accounting system (whether it is another software, spreadsheet, manual entry or other system), then a major consideration is the choice of date for conversion to QuickBooks. You can choose any date as your conversion date. However, if your conversion date (called Start Date in QuickBooks) is after the beginning of your financial year, then your first year s detailed financial statements provided by QuickBooks will only cover part of the year. To view the details of the operations recorded in your previous accounting system, you must look these up and combine them with the figures provided by QuickBooks. This is cumbersome and could lead to errors. Unless you are well-versed in QuickBooks and accounting, you should consider having a QuickBooks Certified ProAdvisor administer your conversion or, at the very least, have a ProAdvisor or your accountant review the conversion when you have completed it. After the first year of operations in QuickBooks, the records provided by the software will be complete for that and each subsequent year. If you are close to the end of the fiscal year, it is recommended that you wait to convert at your fiscal year end. Alternatively, you may want to consider practicing with QuickBooks for the few months remaining in the fiscal year. You can then learn (and make mistakes they are inevitable and are probably the best way to learn) how to use the program with no risk to your accounting records, because you will continue using your current system until year end. By practicing with your own financial data, you will understand the program more quickly, and you will be able to compare your results to those given by your current system. At year end, you can then convert with much more confidence. Although running the two systems in parallel for a few months will take extra time, it is probably well worth it in the long run. Setting up your data files in QuickBooks should be accomplished under the guidance of your accountant. This will ensure that the accountant s requirements are fully met by your operations in QuickBooks. Most accountants have access to people experienced with QuickBooks, such as Certified ProAdvisors, and they can provide guidance on the setup and technical assistance with any problems. At the very least, you should have a list of the accounts required by the accountant, the accountant s suggested format for the balance sheet and income statement, as these will affect the way you set up the chart of accounts v1.00 CCI Learning Solutions Inc.

4 Setting Up Data Files and Customizing Settings Lesson 1 Some smaller businesses and organizations do not use all the functions available in QuickBooks. In fact, some merely set up the data file, create the chart of accounts, and then handle all their accounting using transactions recorded in the general journal. If you do this, you are severely limiting the reporting functions available in QuickBooks, and you are not utilizing the full capabilities of the software. The following checklist outlines the steps you must take to set up a new company from scratch in QuickBooks. You may wish to duplicate this checklist and mark off each item as it is completed. If you are upgrading from Quicken or an older version of QuickBooks, you can convert your existing data. You do not need to complete the following steps. Take note that once you convert the data, you will not be able to use that same file again in the accounting software used previously, and so you should perform the conversion using a copy of your existing data. If you are starting a new business, consult your accountant to help you create your company, so that all government requirements are met. If you have an existing business, gather your records, make sure that the accounts are up-to-date, you have a trial balance, and that accounts receivable and payable subsidiary ledgers agree with the balances in the general ledger on the chosen conversion date. Your current business records should include the following: Current Income (Profit and Loss) Statement Current Balance Sheet Current Trial Balance Tax information (rates and reporting information for sales and income tax) Detailed Customers Aged Report Detailed Vendors (Suppliers) Aged Report Customer contact information Current invoices Vendor contact information Current bills Current vendor, customer, bank and credit card statements Bank and credit card statement reconciliation reports for the period just prior to the start date with details of uncleared cheques and deposits. List of automatic pre-authorized payments and charges that affect your bank or credit card account. List of items (including inventory counts), products, or services offered by your company, including sales and purchase prices, and taxable information. Payroll information such as list of employees, hired date, contact information, frequency and rates of pay, contributions and deductions, calendar year-to-date payroll levels (if the start date is not a calendar year-end). Samples of forms (for example invoices, credit memos and statements) and reports that have been in use prior to the start date or that you would like to have in use once QuickBooks is up and running. The most obvious time to convert from one accounting system to another is at the beginning of a new fiscal year. For peace of mind, you may want to run QuickBooks and your old system in tandem for a month or two to ensure you have set everything up correctly v1.00 CCI Learning Solutions Inc. 3

5 Lesson 1 QuickBooks Premier 2017 Level 2 Create your company in QuickBooks using the EasyStep Interview. Add and format the necessary accounts as advised by your accountant. Enter your existing vendors and any outstanding accounts payable balances from your records. Enter your existing customers and any outstanding accounts receivable balances from your records. Enter the inventory and services that you usually sell and any inventory on hand balances from your records. Enter your employees and any historical figures from your records. If your conversion date is not on January 1, you will need payroll totals for each employee from your old system, covering January 1 to the conversion date, so that your payroll records in QuickBooks will reflect totals for the full calendar year. Using the EasyStep Interview Once you have gathered all the necessary historical information, you are ready to start a new QuickBooks data file company. You can use the EasyStep Interview to create the company data file. QuickBooks offers a number of hints and tips and industry specific advice to guide you during the creation process. Once the data file is created, you can go to individual menus to create, modify, or delete entries. Alternatively, you can use it to create only the basic data file (Express Start), and then manually enter all of the rest of the data. However, you should only do this if you have an excellent knowledge of how QuickBooks works because the software sets up certain accounts for specific purposes. It is recommended to use the EasyStep Interview to create as much of the data file as possible and then add data to it afterwards. The EasyStep Interview guides you through the set up procedure and helps you customize QuickBooks to suit your business. The interview also creates some of the QuickBooks accounts you need. On the left side of each window there is a Progress Indicator to advise your progress as you advance through the procedure. Learn the Skill In this exercise, you will learn to create a new company. 1 Start QuickBooks Premier If a company you previously worked on opens, click File, Close Company on the menu bar. If necessary, close any message boxes that may subsequently appear until the following screen is displayed. 2 Click Create a new company to open the QuickBooks Setup window v1.00 CCI Learning Solutions Inc.

6 Setting Up Data Files and Customizing Settings Lesson 1 You can also display this window, even if you have a company data file currently open, by clicking File, New Company on the menu bar. This window gives you the option to use either the Express Start, or the Detailed Start (EasyStep Interview) to create your data file. For the purpose of this courseware, the EasyStep Interview will be used to set up some of the details for the company. 3 Click Detailed Start to open the first EasyStep Interview window. This window provides fields for the entry of company information, such as the business name, the legal name of the company, contact information, as well as providing an option to connect with a local QuickBooks expert. Any time you wish to exit the EasyStep Interview, click Leave. EasyStep will continue from where you left off the next time you use EasyStep Interview for the same data file. You can also click right corner of the window to exit the EasyStep Interview. (Close) in the upper You do not have to go through the complete EasyStep Interview process; you can change some of these settings elsewhere v1.00 CCI Learning Solutions Inc. 5

7 Lesson 1 QuickBooks Premier 2017 Level 2 Learn the Skill In this exercise you are going to set up a computer retail store called Westcoast Computers Inc. This company is a limited company whose owner is Leslie Jax. 1 Type the following information for your company: Company name Westcoast Computers Inc. - <Your Name> Legal name Westcoast Computers Inc. Be sure to replace <your name> with your own name so that when you print your reports to a shared printer in the classroom, you will recognize which pages belong to you. Address 123 Broadway Vancouver, BC V4H 2M9 Country Canada Phone info@westcoastcomp.ca Web site Your screen should resemble the following: 2 Click Next. 3 In the Select your industry window scroll down to select Retail Shop or Online Commerce, then click Next. 4 In the How is your company organized? window, select Corporation, then click Next. 5 In the next window, select January as the fiscal year start date, and then click Next. 6 The next window is for establishing passwords for security purposes. While the screen shows (optional), QuickBooks 2017 has revised the security requirements for data files, and it is necessary to set a password. It is possible to continue the EasyStep interview without setting a password, but the next time you open the data file, you will be asked to set a password before continuing. It is easier to set it at this time v1.00 CCI Learning Solutions Inc.

8 Setting Up Data Files and Customizing Settings Lesson 1 Setting Up the Administrator Password Every company data file has a system administrator user name called Admin by default. QuickBooks treats this person as the true owner of the data and will, therefore, give this person full access to everything as there are certain tasks that only the Admin can perform, even if other users have been granted access to all areas of the QuickBooks data file. With this Admin ID, you can also grant or remove access for all other users of the data file (although you cannot assign another user a second Admin level of rights). If a user has forgotten his or her password, you can reset it so that the user can access the system. It is essential that only one person in the company has the system administrator s password. That person may be an owner of the company, the accountant, or another trusted person. If you are the system administrator, it is imperative that you do not forget the password because you are the only person who is able to set up or change other users access rights and who has access to certain parts of the system. Learn the Skill In this exercise you will apply a password for the Administrator account as well as continue to customize QuickBooks for your new company. 1 Click in the Administrator password field and type: wescmp1 (case sensitive), press TAB to move to the next field and retype the password. Click Next. 2 This window is for information only, advising that a company file is about to be created. Click Next. The next screen asks for the file name and location to save the company file. Check with your teacher to determine where you should save your company file. 3 Navigate to the location of your Student Files folder, and in the File name field ensure your own name appears as part of the file name. If it does not, replace your name with your own name. Click Save to create the data file v1.00 CCI Learning Solutions Inc. 7

9 Lesson 1 QuickBooks Premier 2017 Level 2 The next screen is the beginning of customizing QuickBooks for your business. 4 Review the information on the screen, and then click Next. 5 Select Both services and products, then click Next. 6 Select Record each sale individually, then click Next. 7 Select I don t sell online and I am not interested in doing so. Click Next. 8 Accept Yes for charging sales tax, and then enter the following information: CRA Business Number for GST or HST RT 0001 PST Registration Number v1.00 CCI Learning Solutions Inc.

10 Setting Up Data Files and Customizing Settings Lesson 1 9 Click Next. If you get a warning about the validity of the number, click Continue anyway. 10 Enter this information in the following windows and click Next after each selection: Create estimates Tracking customer orders Using statements Using progress invoicing Managing bills you owe Do you print cheques? Tracking inventory Do you accept credit cards? Tracking time Do you have employees? Multiple currencies No Yes No No Yes Don t and don t plan to Yes Don t currently, but would like to No Yes No 11 Read the information in the Using accounts in QuickBooks window and click Next. Leave the window open for the next exercise. Start Date Your data file s start date is a key date for setup. This is the earliest date that your balance sheet will be correct. It does not have to be the actual date to begin entering transactions into QuickBooks: you can, and should, begin setting up all of your accounts, customers, vendors, and employees one or two weeks before that date. Then on the actual start date, you have only to enter the actual opening balances of your accounts, customers, vendors, and employees. Before entering this date, ensure that you have accurate account statements (bank, credit card, for example) for the period directly prior to the intended start date. Also, ensure that you have records of all uncleared transactions for these accounts and that you know the unpaid balances for each of your customers and vendors as of your intended start date. Keep in mind that you will not have any details of those historical transactions in QuickBooks. You will have to refer to your copies of historical documents for these details. It is to your advantage to choose the end of your prior fiscal year as your start date. Choosing this date will eliminate the need to combine data from two accounting systems to get a report on the full fiscal year. If choosing the fiscal year start date is not possible, many people like to select the last day of a financial period, such as the end of the last quarter or last month v1.00 CCI Learning Solutions Inc. 9

11 Lesson 1 QuickBooks Premier 2017 Level 2 Whichever start date you do choose, you should be aware that entering historical data covering numerous accounts for many months will be very time-consuming and tedious. Historical payroll transactions must be entered before the next pay period to ensure accurate calendar year-to-date (YTD) amounts for deductions. Other historical transactions for vendors and customers have to be entered before any new transactions are entered into QuickBooks for those vendors and customers. As soon as you enter new transactions, QuickBooks will no longer allow you to change the Opening Balance for a vendor or customer. Although you can change your start date after the setup, it determines much of what occurs during EasyStep Interview setup; therefore, it is easier to consider your options and make your choice now. Learn the Skill In this exercise you will continue to set up the Westcoast Computers Inc. company file. 1 The current window asks for your start date. If necessary, select Use today s date and set the date for: 01/01/2017 and click Next. 2 In the next window, review the income and expense accounts recommended for the file, and click Next. You can modify the Chart of Accounts if necessary after completing the interview. 3 Click the Go to Setup button at the bottom of the window. This window allows you to enter information for several items at once by providing access to the Add/Edit Multiple List Entries screen. Adding Customers and Vendors Learn the Skill In this exercise you will learn how to enter customers and vendors. 1 Click the Add button in the first section of the Add your info screen. In the next screen select Paste from Excel or enter manually, and then click Continue, to display the screen on the following page: v1.00 CCI Learning Solutions Inc.

12 Setting Up Data Files and Customizing Settings Lesson 1 To add customer information you will follow these steps: Click the radio button in the Customer column for each entry. TAB to the Name column, enter the customer s full name. Enter the customers first and last names and telephone number by tabbing to the relevant columns. 2 Enter the following customers: Margery Jansen Phone David Cooper Phone James Walker Phone Your screen should resemble the following. Keep this screen open for the next steps in the exercise. To add vendor information you will follow these steps: Click the radio button in the Vendor column for each entry. Enter the company name in both the Name and Company Name columns. 3 Enter the following vendors: Kingsway Stationery Phone HP Canada Inc. Phone BC Hydro Phone Click Continue. The next screen shows the number of contacts ready to be added, and also if any need to be adjusted before entry. This screen also allows opening balances to be entered at this time v1.00 CCI Learning Solutions Inc. 11

13 Lesson 1 QuickBooks Premier 2017 Level 2 5 Keep this screen open for the next exercise. Practice the Skill The following additional exercise covers many of the items discussed in this Lesson. The Practice the Skill exercises are included as extra practice and may be completed by the students in class or on their own. Your teacher has access to the Answer Key for these exercises. 1. Using the Westcoast Computers Inc. <your name> company data file, make the following changes to Preferences: Deselect Show lowest subaccount only Change the colour scheme to Blue-Gray Select UPS as the Usual Shipping Method 2. Add the following new General Ledger Accounts: Type Number Name Sub Account of Fixed Asset Cost Furniture and Equipment Fixed Asset Accumulated Dep Furniture and Equipment Bank Petty Cash Say NO to online account 3. Create a new U/M set: Count, Each (ea), package 15, Purchase: package, Sales: each, Package. 4. Close the company data file v1.00 CCI Learning Solutions Inc.

14 Setting Up Data Files and Customizing Settings Lesson 1 Lesson Summary In this lesson you learned how to convert from your current accounting system to QuickBooks. Now that you have completed this lesson, you should know how to: use EasyStep Interview to set up your company data file enter the company information enter the data file start date set administrator s password use the Add/Edit Multiple List Entries windows enter customers, vendors, and inventory items enter opening balances set up data file preferences Review Questions add and modify General Ledger accounts manually enter the opening balances for General Ledger accounts work with account numbers enter additional customers, vendors and opening balances work with Registers enter additional inventory items and balances 1. If you convert from your existing accounting system to QuickBooks, will you be able to record and report on the full year from QuickBooks? Why or why not? 2. Opening balances have to be input into QuickBooks before the system becomes operational. a. True b. False 3. What are the Uncategorized Income and Uncategorized Expenses accounts and why are they created? 4. You can enter opening balances for any account that would appear on the Balance Sheet, but not any income or expense account that would appear on the Profit & Loss statement. a. True b. False 5. Once you have added customers to the company data file during the EasyStep Interview, you will no longer be able to add any more customers manually. a. True b. False 6. When you enter the opening balance of each vendor in the Accounts Payable, you will be able to enter each individual outstanding invoice, invoice date, and the unpaid balance of each invoice. a. True b. False v1.00 CCI Learning Solutions Inc. 13