 Now you can also track the bill and stuff on on the left hand side that's now outstanding. The bill is in the accounts payable so if I go to the expenses and then the vendors then you've got a bill for and again it's kind of limited because this is limiting to 365 up top but I believe it was in here and then now you've got your your bill and you can have a payment schedule a payment for the bill so that's the next step that would happen you know typically with a bill let's assume now you could make the payment here using a payment form and then use the bank feeds to double check the payment form that you would make or I can try to wait till something clears the bank and attach it to the bill with the bank feeds which will record this next step so let's let's try to do it that way I'm gonna I'm gonna go to the bank fees and say okay now this transaction has been recorded I'm going to say this was one on on the 1017 one for $30 that's the one I think and so let's take this one I know the dates are way far off but let's just imagine that this one now is a payment that I'm not going to use to record the inventory but instead I already recorded the inventory I'm going to try to match it up to the transaction that I have already put in place so I'm going to try to find a match to it and then I'm going to change the date from 0101 to 2 and so there's our bill that's matching up now if these things were close in time frame QuickBooks might try to try to match it beforehand it might have picked it up because I put them so distance in time QuickBooks had trouble picking it up and if I and notice I'm matching to a bill now so if I had entered the bill as with an expense form or paid the bill with an expense or check form or pay bill form then then it would match to the pay bill form and that might be easier for QuickBooks to match up but I'm going to select the bill so what's that going to do it's in essence going to enter the pay bill form so now I have if I look at the flow chart I had a bill that was put in place I'm using the bank feeds in between here so instead of me paying the bill and then matching it to QuickBooks I'm going to use use the bank feeds to to basically record the pay bill matching it to the bill after it's actually cleared the bank all right so let's do it so we're going to say that looks good and I think that's good so then I'm going to have then I'm going to save it and so now we've recorded that transaction so if I go to the balance sheet run it again now we've got the checking account impacted the checking account notice it created a pay bill form instead of the normal expense form because the pay bill form is basically like an expense form but it's it's got a its own special designation noting that it's used to decrease the accounts payable as opposed to a normal expense form or check form which is decreasing the checking account the other side going to somewhere like utilities or something so if I go into this one drilling down on it then we've got the pay bill form this is what the pay bill form you know typically looks like we did it through the matching format of the bank feeds so it doesn't take us to the bank feeds it takes us to the to the form closing this back out and then the other side if I go back on up top went to the accounts payable which is now back to zero accounts payable has now been paid so if I go into that this is what we expect to see an accounts payable bill goes up it goes down with the pay bill so the inventory adds a little bit of complexity there now obviously that's just on the inventory for the purchase side of things the next step would be for us to sell the inventory and so when we sell the inventory I can't wait till it clears the bank I'd have to sell the inventory with a sales receipt or an invoice in order for QuickBooks to track the inventory which would reduce you know the inventory and record the cost of goods sold on a perpetual inventory system so let's just take a look at that so if I went back on over and said let's make an invoice I'm going to go to the first tab new button I'm going to make an invoice and let's say this is going to be for customer one now customer one has this thing that's linked to it because I made the item billable so it's trying to pull it in but there's a bit of a problem if I hit add I'm going to say okay let's just tap through this so I don't forget anything and so I'm just going to make the date closer to real time let's make it like 10 01 2 2 or something like that that I'm going to sell it on and then down here it pulled in the item but notice it pulled it in at the wrong rate it pulled in the cost not the sales price so what I'll do is I'll just double check the inventory item down here it should be sold for $60 so I'm going to change this to 60 to reflect the proper price the link works good the cost of goods sold I think will be recorded correctly but that's something I want to point out is a little tricky thing with regards to if you're trying to use that billable item with inventory items so I'm going to I'm going to trash the one below now this actually does a lot this transaction is recording a lot at the same time now it's an invoice it's going to increase accounts payable by the full amount the $60 the other side is going to go to sales or revenue driven by the item which I believe we told it to go to sale of product revenue if there was sales tax it would also record the sales tax on it but we're not going to deal with the sales tax at this point and then also the inventory is going to go down by $30 I believe we set it up for which is the cost not showing on the invoice because we don't want to show the cost to the client and caused a good sold the expense related to the purchase will also be recorded at $30 and the impact on net income will be the sales price 60 minus $30 or 30 and the sub ledger for the customer will be impacted tracking the receivables by customer and the sub ledger for inventory will be impacted showing the units of inventory impacted as well as the dollar amount so actually a lot going on here in a perpetual inventory system when you check something out at a grocery store check register or something there's a lot going on even though the transaction is quite simple to facilitate once it's all set up so if I save it and close it just to double check that go into the balance sheet we can then run it we got accounts receivable going up by the 60 that there's that the other side's going to the income statement if I run the income statement we've got income going up at the 60 if I go back to the balance sheet we also have the inventory which should be going down so if I have the inventory going down by the 30 so it went up and then it went back down again and then if I go back to the balance sheet cost a good sold by going to the cost of goods sold it was recorded at the 30 the impact on the income statement would be the increase to the income statement which was 60 minus the impact on cost of goods sold which was 30 and back to the balance sheet the inventory sub ledger should track the information in the sub ledger it's back down to zero nothing's in it even though that doesn't match what's on the balance sheet because we've recorded that 160 dollar amount not using items in a prior presentation and then of course we can track the accounts receivable if we use an accounts receivable and the next step there would be we're going to receive a payment on it but we'll talk more about that in future presentations