QuickBooks Complete 2018 For QuickBooks Pro, Premier and Accountant 2018 Copyright 2018
Product Name QuickBooks Complete - Version 2018 ISBN: 978-1-942417-21-7 Trademarks Intuit, the Intuit logo, QuickBooks, QuickBooks Pro, QuickBase, Quicken, TurboTax, ProSeries, Lacerte, EasyStep, and QuickZoom, among others, are registered trademarks and/or registered service marks of Intuit Inc. in the United States and other countries. QuickBooks ProAdvisor is a trademark and/or service mark of Intuit Inc. in the United States and other countries. Other parties trademarks or service marks are the property of their respective owners and should be treated as such. Copyright 2018 Questiva Consultants All rights reserved Published by Questiva Consultants Disclaimer This material is intended as a learning aid for QuickBooks software users. Under no circumstances shall the author or publisher be liable for any damages, including any lost profits, lost data or other indirect damages arising out of anything written in this document or expressed directly or indirectly by the author or publisher. Developed and Written By Douglas Sleeter Deborah Pembrook Contributing Authors, Testers, and Reviewers Pat Carson Tricia Lippincott Ellen Orr Questiva Consultants 1501 Dry Creek Road, San Jose, CA 95125 Phone: 408 440 4182 Fax : 408 351 0473 www.questivaconsultants.com Questiva Consultants is the publisher and supplier of QuickBooks Accounting Textbooks to students, community colleges and business/trade schools. These textbooks were originally developed by the Sleeter Group.
Preface... xi QuickBooks 2018 Versions... xi Using QuickBooks 2018 Student Trial... xi Using This Book... xi Integrating QuickBooks with other products... xii About the exercise files... xii Installing the exercise files... xii Certification...xiii Acknowledgements...xiii Chapter 1 Introducing QuickBooks... 1 Topics... 1 The QuickBooks Product Line... 1 QuickBooks Desktop vs. QuickBooks Online... 1 QuickBooks Editions... 1 QuickBooks Releases... 2 Accounting 101... 2 Accounting s Focus... 2 Accounts, Accounts, Everywhere Accounts... 2 Account Types and Financial Reports... 3 Double-Entry Accounting... 3 Accounting Behind the Scenes... 4 Accounting for the Future: Cash or Accrual?... 4 Academy Photography... 5 QuickBooks Files... 5 Creating a New File... 6 Opening a QuickBooks Sample File... 6 Opening Other QuickBooks Data Files... 7 Closing QuickBooks Files... 9 Opening Multiple Files... 9 Closing the QuickBooks Program... 9 Opening Portable Company Files... 9 Creating Portable Company Files... 12 Restoring Backup Files... 13 Backing up Your Data File... 13 Restoring a Backup File... 17 QuickBooks User Interface Features... 17 Home Page... 17 Centers... 18 Snapshots... 19 Income Tracker... 19 Icon Bar... 20 Calendar... 20 Entering Transactions in QuickBooks... 21 Forms... 21 Lists... 22 Accounts... 22 Registers... 23 Items... 24 QuickBooks Help... 26 Support Resources... 26 Certified QuickBooks ProAdvisors... 26 Review Questions... 27 Comprehension Questions... 27 Multiple Choice... 27 Completion Statements... 28 Introduction Problem 1... 28 Introduction Problem 2 (Advanced)... 28
Chapter 2 The Sales Process... 31 Topics... 31 Tracking Company Sales... 31 Setting Up Customers... 34 Job Costing... 40 Recording Sales... 41 Entering Sales Receipts... 41 Undeposited Funds... 45 Creating Invoices... 47 Open Invoices Report... 52 Receiving Payments from Customers... 54 Receiving Payments by Check... 54 Handling Partial Payments... 56 Receiving Payments by Credit Card... 56 Where Do the Payments Go?... 57 Preferences for Applying Payments... 57 Recording Customer Discounts... 59 Making Bank Deposits... 62 Depositing Checks and Cash... 62 Holding Cash Back from Deposits... 65 Printing Deposit Slips... 65 Depositing Credit Card Payments... 67 Income Tracker... 70 Review Questions... 72 Comprehension Questions... 72 Multiple Choice... 72 Completion Statements... 75 Sales Problem 1... 75 Sales Problem 2 (Advanced)... 76 Chapter 3 Additional Customer Transactions... 79 Topics... 79 Recording Customer Returns and Credits... 79 Refunding Customers... 80 Writing Off a Bad Debt... 86 Applying the Bad Debt Credit Memo to an Open Invoice... 89 Create Batch Invoices... 89 Creating Customer Statements... 91 Assessing Finance Charges... 93 Collecting Sales Tax... 95 Setting up Sales Tax... 95 Sales Tax Codes... 99 Calculating Sales Tax on Sales Forms...101 Creating Sales Reports...101 Customer Open Balance Report...101 Sales by Customer Summary Report...102 Sales by Item Report...103 Review Questions...104 Comprehension Questions...104 Multiple Choice...104 Completion Statements...107 Customers Problem 1...107 Customers Problem 2 (Advanced)...107 Chapter 4 Managing Expenses... 109 Topics...109 Entering Expenses in QuickBooks...109 The Process of Entering Expenses in QuickBooks...109 Setting Up Vendors...112 Activating Class Tracking...117 Tracking Job Costs...119
Paying Vendors... 119 Using Registers... 120 Using Write Checks Without Using Accounts Payable... 123 Managing Accounts Payable... 124 Printing Checks... 133 Voiding Checks... 136 Applying Vendor Credits... 139 Handling Deposits and Refunds from Vendors... 142 Vendor Deposits When You Use Accounts Payable... 142 Vendor Refunds When You Use Accounts Payable... 143 Vendor Refunds When You Directly Expensed Payment... 147 Tracking Petty Cash... 147 Tracking Company Credit Cards... 148 Entering Credit Card Charges... 148 Paying the Credit Card Bill... 149 Paying Sales Tax... 151 Paying Sales Tax... 151 Accounts Payable Reports... 152 Vendor Balance Detail... 152 Transaction List by Vendor... 153 Sales Tax Liability... 154 Tracking Loans using the Loan Manager... 154 Setting up a Loan in the Loan Manager... 155 Making Loan Payments using the Loan Manager... 157 Bill Tracker... 160 Review Questions... 162 Comprehension Questions... 162 Multiple Choice... 162 Completion Statements... 165 Expenses Problem 1... 165 Expenses Problem 2 (Advanced)... 166 Chapter 5 Bank Reconciliation and Bank Transactions... 169 Topics... 169 Reconciling Bank Accounts... 169 Bank Reconciliation Reports... 175 Finding Errors During Bank Reconciliation... 176 Step 1: Review the Beginning Balance Field... 177 Step 2: Locate and Edit Incorrectly Recorded Transactions... 178 When QuickBooks Automatically Adjusts your Balance... 181 Handling Bounced Checks... 182 When Your Customer s Check Bounces... 182 Receiving and Depositing the Replacement Check... 184 If Your Check Bounces... 185 Reconciling Credit Card Accounts and Paying the Bill... 185 Bank Feeds... 188 Bank Feed Setup... 188 Processing Online Transactions... 188 Opening the Sample File... 189 Downloaded Transactions... 189 Review Questions... 192 Comprehension Questions... 192 Multiple Choice... 192 Completion Statements... 194 Bank Reconciliation Problem 1... 194 Bank Reconciliation Problem 2 (Advanced)... 195 Chapter 6 Reports... 197 Topics... 197 Types of Reports... 197 Cash Versus Accrual Reports... 198
Accounting Reports...200 Profit & Loss...200 Profit & Loss by Class Report...203 Profit & Loss by Job Report...206 Balance Sheet...207 Statement of Cash Flows...207 General Ledger...208 Trial Balance...209 Voided/Deleted Transactions Reports...210 Business Management Reports...211 Customer Phone List...211 Vendor Contact List...212 Item Price List...213 Check Detail Report...213 Accounts Receivable and Accounts Payable Reports...214 QuickBooks Graphs...216 Building Custom Reports...218 Memorizing Reports...226 Viewing Memorized Reports...227 Contributed Reports...227 Processing Multiple Reports...228 Printing Reports...230 Finding Transactions...232 Using the Find Button...232 Using the Search Command...232 QuickReports...233 Using QuickZoom...236 Exporting Reports to Spreadsheets...237 Exporting a Report to Microsoft Excel...237 Review Questions...239 Comprehension Questions...239 Multiple Choice...239 Completion Statements...241 Reports Problem 1...241 Reports Problem 2 (Advanced)...241 Chapter 7 Customizing QuickBooks... 243 Topics...243 QuickBooks Preferences...243 Setting User Preferences...243 Customizing QuickBooks Menus and Windows...246 Favorites Menu...246 QuickBooks Icon Bar...247 Customizing the Icon Bar...248 Open Windows List...252 QuickBooks Items and Other Lists...253 QuickBooks Items...253 Printing the Item List...259 The Terms List...259 Price Levels...261 Custom Fields...263 Adding Custom Field Data to Customer Records...264 Modifying Sales Form Templates...265 Review Questions...269 Comprehension Questions...269 Multiple Choice...269 Completion Statements...272 Customizing Problem 1...272 Customizing Problem 2 (Advanced)...273 Chapter 8 Inventory... 275
Topics... 275 QuickBooks Tools for Tracking Inventory... 275 Tracking Inventory with QuickBooks... 276 Activating the Inventory Function... 277 Setting up Inventory Parts Items... 279 Calculating Average Cost of Inventory... 283 Invoicing for Inventory Items... 283 Selling Inventory Items Using an Invoice Form... 283 Creating a Transaction Journal Report... 284 Using Reminders for Inventory... 285 Purchasing Inventory... 285 Purchasing Inventory at a Retail Store with Check or Credit Card... 286 Purchase Orders... 287 Creating a Purchase Order... 287 Receiving Shipments Against Purchase Orders... 288 Creating Open Purchase Orders Reports... 290 Checking Purchase Order Status... 291 Entering the Final Shipment... 292 Entering Bills for Received Inventory... 293 Converting an Item Receipt into a Bill... 293 Handling Overshipments... 294 Handling Vendor Overcharges... 295 Adjusting Inventory... 296 Adjusting the Quantity of Inventory on Hand... 297 Adjusting the Value of Inventory... 298 Setting up Group Items... 299 Inventory Reports... 300 Inventory Item QuickReport... 300 Inventory Stock Status by Item Report... 301 Inventory Stock Status by Vendor Report... 302 Inventory Valuation Summary... 302 Unit of Measure... 303 Turning on Unit of Measure Single U/M... 303 Applying Unit of Measure to Items... 304 Inventory Assemblies... 306 Review Questions... 310 Comprehension Questions... 310 Multiple Choice... 310 Completion Statements... 312 Inventory Problem 1... 313 Inventory Problem 2 (Advanced)... 314 Chapter 9 Time and Billing... 317 Topics... 317 Reimbursable (Billable) Expenses... 317 Using Two-Sided Items... 324 Tracking Custom Orders... 325 Using Service Items to Track Subcontracted Labor... 330 Unbilled Costs by Job Report... 332 Billable Time... 333 Activating Time Tracking in QuickBooks... 333 Entering Time on Timesheets... 334 Printing Timesheets... 335 Invoicing Customers for Time... 336 Tracking an Owner s or Partner s Time... 338 Time Reports... 341 Time by Name Report... 341 Time by Job Detail Report... 342 Time by Item Report... 343 Vehicle Mileage Tracking... 344
Multiple Pass-Throughs on One Invoice...348 Review Questions...352 Comprehension Questions...352 Multiple Choice...352 Completion Statements...354 Time and Billing Problem 1...355 Time and Billing Problem 2 (Advanced)...356 Chapter 10 Payroll Setup... 359 Topics...359 Checklist for Setting Up Payroll...359 Payroll Accounts...360 Payroll Items...361 The Payroll Setup Interview...362 Setting Up Compensation and Benefits Payroll Items...362 Medical Insurance Deduction...364 401(k) Employee Deduction and Company Match Items...367 Paid Time Off Payroll Items...370 Setting Up Employees...372 Payroll Tax Item Setup...376 Scheduling Your Tax Payments...377 Setting Up Year-to-Date Payroll Amounts...379 Finishing Up the Payroll Setup Interview...379 Custom Fields for Payroll...380 Setting Up Employee Defaults...381 Default settings for taxes...383 Default Settings for Sick/Vacation Time...384 Changing Employee Payroll Information...385 The Accounting Behind the Scenes Payroll Items...386 Calculated Items Based on Quantity...388 Based on Hours...388 Adding Payroll Items from the Payroll Item List...388 Adding a Wage (Compensation) Item...388 Editing Payroll Items...390 Editing the Federal Withholding Payroll item...391 Editing the Federal Unemployment item...391 Editing the Medicare and Social Security items...393 Editing the State Withholding item...394 Editing the State Disability item...394 Editing the State Unemployment item...395 Editing Other Tax items...396 Releasing Employees...397 Deactivating and Reactivating Employees...397 The Employee Contact List report...399 Review Questions...400 Comprehension Questions...400 Multiple Choice...400 Completion Statements...402 Payroll Setup Problem 1...402 Payroll Setup Problem 2 (Advanced)...404 Chapter 11 Payroll Processing... 407 Topics...407 Payroll Processing Checklists...408 Every Payday...408 Every Tax Deposit Due Date (monthly or semi-weekly)...408 Every Quarter (after the end of the quarter)...408 Every January...408 Using the Employee Center...408 Payroll Center...409 Payroll Tax Tables...409
Paying Employees... 409 Selecting the Employees to Pay... 410 Printing Paychecks... 414 Printing Pay Stubs... 416 Editing Paychecks... 417 Replacing Lost or Stolen Checks... 419 Voiding Paychecks... 420 Deleting Paychecks... 420 Paying Payroll Liabilities... 421 Editing a Liability Payment... 424 Adjusting Payroll Liabilities... 425 Creating Payroll Reports... 426 Payroll Summary Report... 426 Sales Rep Commissions... 427 Payroll Liability Balance Report... 428 Preparing Payroll Taxes... 431 Review Questions... 432 Comprehension Questions... 432 Multiple Choice... 432 Completion Statements... 434 Payroll Processing Problem 1... 434 Payroll Processing Problem 2 (Advanced)... 435 Chapter 12 Company File Setup... 437 Topics... 437 Choosing a Start Date Step 1... 437 Creating the Company File Step 2... 438 Express Start... 438 Detailed Start... 440 Setting Up the Chart of Accounts and Other Lists Step 3... 447 Setting Up the Chart of Accounts... 447 Setting Up Other Lists... 457 Add/Edit Multiple List Entries... 457 Setting Up Opening Balances Step 4... 459 Gathering Your Information... 459 Opening Balances for Accounts... 462 Understanding Opening Bal Equity... 465 Entering Open Items Step 5... 465 Entering Outstanding Checks and Deposits... 465 Entering Open Bills (Accounts Payable)... 466 Entering Open Invoices (Accounts Receivable)... 467 Entering Open Purchase Orders... 468 Entering Open Estimates and Sales Orders... 468 Entering Year-to-Date Income and Expenses Step 6... 468 Adjusting Opening Balance for Sales Tax Payable Step 7... 469 Adjusting Inventory and Setting up Fixed Assets Step 8... 470 Adjusting Inventory for Actual Counts... 470 Setting up Fixed Assets... 471 Setting up Loans... 471 Setup Payroll and YTD Payroll Information Step 9... 471 Verifying your Trial Balance Step 10... 471 Closing Opening Bal Equity Step 11... 473 Setting the Closing Date - Backing up the File Step 12... 474 Setting the Closing Date to Protect your Setup Balances... 474 Users and Passwords... 474 Setting Up Users in the Company File... 474 Multi-User and Single-User Modes... 479 Review Questions... 480 Comprehension Questions... 480 Multiple Choice... 480
Completion Statements...482 Setup Problem 1...483 Setup Problem 2 (Advanced)...483 Chapter 13 Estimates... 489 Topics...489 Creating Estimates...489 Creating Invoices from Estimates...490 Progress Invoicing...493 Creating Purchase Orders from Estimates...496 Viewing and Tracking Estimates...499 Viewing Estimates...499 Tracking Estimates...500 Sales Orders...502 Review Questions...503 Comprehension Questions...503 Multiple Choice...503 Completion Statements...505 Estimates-Problem 1...505 Estimates-Problem 2...506 Chapter 14 Adjustments and Year-End Procedures... 507 Topics...507 General Journal Entries...507 Creating a General Journal Entry...508 Adjusting Expense Accounts Associated with Items (Zero-Dollar Checks)...509 Editing, Voiding, and Deleting Transactions...510 Editing Transactions...511 Voiding and Deleting Transactions...512 Deleting All Transactions...513 Memorized Transactions...514 Memorizing a Transaction...514 Deleting, Rescheduling, and Editing Memorized Transactions...516 Tracking Fixed Assets...518 Using the Fixed Asset List...521 Calculating and Recording Depreciation...522 Processing 1099s...523 The 1099 Wizard...524 Editing 1099 Information in Vendor Records...525 Closing the Year...527 Closing the Accounting Period...528 Recording Closing Entries for Sole Proprietorships and Partnerships...529 Distributing Net Income to Partners...532 Setting the Closing Date to Lock Transactions...533 Review Questions...535 Comprehension Questions...535 Multiple Choice...535 Completion Statements...537 Adjustments Problem 1...537 Adjustments Problem 2 (Advanced)...538 Chapter 15 Walker Graphic Design Business Scenario... 539 Description of Company...539 Goals...539 Company Set Up...539 Instructions...540 Business Transactions...540 May 2019...540 Analysis Questions...546 Chapter 16 Horizon Financial Planning Business Scenario... 547 Description of Company...547 Company Set Up...547
Instructions... 547 Business Transactions... 548 October 2019... 548 November 2019... 554 Analysis Questions... 560 Appendix... 563 Keyboard Shortcuts... 563 Answer Key for End of Chapter Questions... 563 Introducing QuickBooks... 564 The Sales Process... 565 Additional Customer Transactions... 566 Managing Expenses... 567 Bank Reconciliation... 568 Reports and Graphs... 569 Customizing QuickBooks... 570 Inventory... 572 Time and Billing... 573 Payroll Setup... 574 Payroll Processing... 575 Company File Setup and Maintenance... 576 Estimates... 578 Adjustments and Year-End Procedures... 579 Walker and Horizon Business Scenarios... 580 Index... 581