 zero accounting software payment form used to pay outstanding bills get ready to be an office hero with zero support accounting instruction by clicking the link below giving you a free month membership to all of the content on our website broken out by category further broken out by course each course then organized in a logical reasonable fashion making it much more easy to find what you need then can be done on a YouTube page we also include added resources such as Excel practice problems PDF files and more like QuickBooks backup files when applicable so once again click the link below for a free month membership to our website and all the content on it here we are in our custom zero home page we set up in a prior presentation I'm gonna zoom in a bit by holding down control scrolling up on the wheel of the mouse we're currently at 175 percent zoom in we will be looking at the demo company but before we do note that we entered some data into the demo company last time if we want to reset the data we can use the reset item here which I will do I'm gonna reset it it says are you sure you want to reset the demo if you reset the demo company any changes you made will be lost so it allows you to kind of maintain some changes and reset it which is really great feature I really like that so I'm gonna say do it let's reset the data now it opens up our information so I got to hide some of the stuff again so I just hide this thing that we looked at last time I'm gonna close up the first tab because I don't need it anymore it's now opened up the demo version I'm gonna open up our standard two reports and two new tabs so I'm gonna right click on the tab up top and duplicate it I'm gonna go to the tab that was opened right click on it again and duplicate again in the middle tab now let's open up accounting drop-down reports let's go to the balance sheet one of our favorites up top has to be everyone's favorite if you're doing any accounting the balance sheet is certainly a favorite report to the tab to the right accounting drop-down reports again and this time we're gonna go to the income statement profit and loss in the middle tab I'm gonna change the dates now to put it for 2022 custom date range and we'll bring it up to 2022 this is what we'll do every time open up these two reports every time and then noting that that's kind of the end result that we are shooting for as we enter data now we've been taking a look at the expense cycle or vendor cycle last time focusing in on the bill form so just a quick recap if we kind of visualize the flow chart of us eventually having money outflowing from the company in one way or the other to pay for goods and services that could happen a few different ways in terms of just the forms of the flow chart we might just pay the expenses as they become due possibly with a check form or a decrease to the checking account possibly with the use of bank feeds as they happen or we might have more of an accrual kind of setup where we're entering the bills and that's what we're focused in on here that means that as I get the bill from the vendor or the supplier noting and remembering that the bill in terms of outside of the software and inside of the software a bit different inside of the software being much more specific the bill could be an actual paper form or it could be an electronic PDF I could get that bill and pay it by just writing a check or having an electronic transfer or I might enter it into a bill form a data input form into our system which is an accrual process which would increase the accounts payable and the other side would then go to the expense if it was an expense that we're paying for and then of course we're going to have to track the outstanding accounts payable and pay the bill which in essence a check type form a decrease to the checking account but a specific one will which will be decreasing the payable account and then we'll get into up top buying a purchase order and throw that into the mix shortly but right now the pay bill the second step in the normal kind of accounts payable accrual process for paying for goods and services so let's go back to the first tab I'm going to actually make the bill again so let's write another bill so I hit the plus button what would typically happen in our cycle if we have an accrual cycle is instead of just spend the money decrease the checking account type of form we're going to enter the bill and then we're going to pay off the bill so let's enter a bill we did this last time good but I'm going to re-enter just so we can refresh yourself on what the bill is doing I'm going to make a new vendor which we called a AA last time I'm going to add the contact I'm going to say November 30th that's the date that's good the due date is going to be when it's going to be due when we have to pay it by reference if we want to add it if we want to upload anything as we saw last time that's why I'm doing this fairly quickly we can upload more documentation here if it was an inventory item we're purchasing then we would have an item because we would need an added level of tracking related to it we'll talk about items more later but we're not going to imagine we're buying inventory we're going to have one quantity of a hundred dollar thing and we're just going to assign it to an account I'm going to make up a new account here like we did last time we could just make an account as we go it's typically going to be an expense type of account income statement type of account I'm going to make it at 850 which is basically an account number it's available that's great and I was just going to call it example expense account and I'll copy that in the name and put that in the description not going to have any tax on it so I'm going to say it's going to be see tax on purchases zero and I'm going to say alright let's save that this is going to increase when I enter it the accounts payable the other side going to the expense the income statement of this item here two accounts affected every time we enter a form now we saw last time that we went through the process here of saving as a draft and then saving for approval oftentimes if you're a smaller company are doing bookkeeping you'll just simply go right to the approve or you might have approve and add another in which case you'd be entering another bill I'm just going to go right to the approval this time so now in terms of the financial statements if I go up to the balance sheet then and I refresh it update the balance sheet then we should have in the accounts payable if I drill down I can drill back to the source document and I can scroll all the way down to November I should probably shorten the dates to make it a little easier but I scroll all the way down and we should have there's the $100 right there you can it's called a payable invoice so notice we're getting that terminologies a little confusing invoices and bills you got to know where you are I'm in the payable area so this is like a bill you know some I can then select that and that'll take us back to where we have the data input now if you want to change it or something like that you have the bill drop down you've got the edit options and so on but there it is that's so that's really nice we can drill back down to the source document I'm gonna go back I'm gonna go back so that takes me to the balance sheet if I go to the income statement update it so it's refreshed then we can see that we have the other side going to the example expense account we set up for the hundred dollars drilling back down to the source document we can then see the activity payable invoice notice notice noting this source is a useful tool because that's kind of like the form that was used and if you know the forms you can have an idea of what the journal entries are gonna be the accounts that will be affected but it also gives you the other account accounts payable alright so if I go back now now we're gonna imagine we have to pay off the bill how do we sort that well if I go back to the first tab usually we're gonna be sorting this out within the system by going to the accounting drop-down and we're gonna go to I'm sorry to the business drop-down and go down to the pay bills now just a quick recap on the sub ledger in essence if you if you look at the balance sheet and you see this accounts payable you could say okay that means that I owe people money if I drill down on it it's clicking on it that'll give us the activity in the accounts payable going up and down by date but what I really need to know is who I owe the money to now usually you sort that information in the system over here in the bills and in the contacts and the suppliers but just from a theoretical standpoint note that you can also have a sub ledger that should tie out to that amount by customer so in other words if I go I'm gonna go to the tab to the right right click on it duplicate this and then go to another report noting that all other reports other than the balance sheet and the income statement you can think of as in essence subsidiary reports sub ledgers giving more information about a line or multiple line items on the balance sheet and the income statement so I'm going to go down to the payables and receivables we're going to go into the aged payable detail report just to prove that and this is going to give us our information I'm going to hit the drop down and do a custom date let's bring it up to December December 31st run it or update it and then if I scroll down we've got it broken out by we have that the date ranges up top we'll talk about that later but just to note in a sub ledger you've got it broken out by who we owe the money to vendor or supplier the total is the point ten thousand three ninety one eighty four should match what's on the the balance sheet so this balance sheet account gives us a summary and then we can expand on that using the sub reports now normally we don't go to the sub reports when we're just entering the data because we're going to be tracking the bills inside of our system here and our goal in the accounts payable side of things which usually will only be there as your company gets larger and larger in other words smaller companies probably aren't going to spend as much time trying to pay their bills as late as possible every time because if you don't pay your credit card bill or you your utility bill 15 days later than you otherwise could have if you pay it 15 days earlier it's not having a big impact on you it's in material but if you have a lot of transactions then it becomes material and or if those transactions are quite large holding onto your money longer is it's going to become a more significant and important you know cash management strategy even if it's only a few days longer so now we can sort our bills if I go into the drop down we're in the pay bills area we've got we can have new bills that would enter here a new credit note import export for an all drafts awaiting approval awaiting payment paid and repeating so clearly we went through this process up top when we entered the bill normally we would go into the awaiting payment and this is going to be sorting our bills down below by you know the ones that are outstanding that we can then sort and pay then we could sort them in various ways I can go to the from item here and sort who I owe the money to it's probably most common to be sorting by date or by by the due date because those will give you the amounts that you need to be paying soon and then you could select the items that you do need to be paying like so I could select a multiple items that need to be paid possibly and then I can say I want make a payment or I can schedule payments for multiple items at one time so if I went into say make payment says make payment choose a payment method pay by check batch payment create a file to upload to your bank and then you have the alternative pay with bill.com which you can look into if you want to get into that more detail so I'm going to close that back out so you can also go into each one of these at a time so if I went into one item here then at the bottom so here's the actual bill and then at the bottom you've got this information that can go through and facilitate the payment you also have the history kind of items down here and you can add a note so I'm going to go back I'm going to use go back here and obviously we can we can enter information here we can search with any date transaction date or the due date possibly these two are probably the most common the due date you know might be the most common kind of sorting tool that you might have the start date and end date so you can look at ranges to kind of sort your data in here as well so I'm going to sort it back by the date so I'm going to click on the date and then I'm going to click on the date again and that puts that last one that $100 up at the top that we'll be kind of dealing with and following through with this now the other area that you could you can look into these items by as you might say okay I want to see it by person that we are paying and this would be more common if someone asked you in particular a vendor or supplier suppliers contact suppliers came and asked questions then you might go into this area more likely and say okay this is this suppliers asking the questions about their activity we can go into there and say oh yes I see you know the bill awaiting payment here for the $100 and then you might go in there and pay it that way but more likely when you're trying to see which bills you're going to pay you would be going into I'm going to go back but before I did just note right here that it also gives you a nice a nice quick reference on who you owe the money to this is similar to like a report but it doesn't give you the total balance so that's why in practice you probably are going to use this to give you a quick view of who you know who you owe money to and sort it in that way but it doesn't give you that nice total down here like the report does which should tie into of course the balance sheet because you're looking at the detail of the balance sheet so oftentimes you would most likely be going into the business drop-down pay bills looking at the bills that are that you need to be paying selecting the bills and either selecting multiple bills and paying them whoops hold on a sec back and paying them by by here I'm in all here let's go to pit let's go to awaiting payments awaiting payments and then again you could select multiple items here and then you could make the payment that way or I'm just gonna make the payment on this one individually by going into this item here going into the bottom of it so I'm in the bill so there's the bill up top I'm gonna make the payment down below so it's nice and connected if you're not paying the full amount you could put of course some other amount which means there's still be an outstanding balance if I put 25 here there'd still be 75 outstanding the date paid so we're gonna put the date paid I'll just put the same date we're gonna say the payment form usually the check-in account is what you'll be paying with and then the reference I'll leave that as is and if you're paying with a check you can check off the check if it's not a check and it's some other form of electronic transfer payment which I'll say here I'll uncheck that and add the payment so now we add the payment says paid do so that looks good and then it moves it from the awaiting payments to the paid area so if you still wanted to sort it here you can find it in the paid area and of course now it's gonna be pulled into our financial statement that created a financial transaction which will be decreasing the check-in account and decreasing the accounts payable let's look at that balance sheet let's update the balance sheet let's go into the accounts payable so if I go into that accounts payable and I scroll all the way down to the bottom and I'm gonna scroll down down down down down down and so now we've got it goes in and out right so now we've got the debit and credit the increase and the decrease noting that it calls this an invoice type of form the bill in essence and this is going to be a payable payment is what it kind of refers to here which means it's going to be a check type of form and that it's decreasing the checking account and but it's paying off a specific thing it's always going to be going to the payable and the checking account it's always going to be a decrease to the checking account the other side going to the accounts payable if I go into that then it's going to take me back to the form so here it is and here's the transaction so if I notice that this is a payment form which means that it's decreasing the accounts payable if I want to look at the detail of what the bill was actually for and the account that was hit when the bill was entered I need to go to the actual bill so I can click here with the connection and that will take me to the bill where I have the actual activity and I can see the account that was used on the bill I also have the history down below so I'm going to go back and so that takes me to the payment form I also have the history down here so if you select the history it's created right here you can add a note if you so choose on it as well let's go back once again and so now we are on the transaction detail let's go back again I'm going to go then to the financial statements now the other sides on in the checking account which usually would be an asset but because it's overdrawn that's why it's down here in the liabilities so don't let that mess you up it flipped from an asset to a liability because it's overdrawn we owe the bank money in other words so let's go into that item and find the transaction which will most likely be at the bottom again so we'll scroll on down and then so there it is so there's the payment so now we made the payment notice it's it's a different source here instead of being called a spend money it's called a payment so if you know those terms you'll know that the other side is going to account table it says it right here too but you want to have an idea of what these forms are doing in the stock transactions related to them so in other words if I go into this payment form we'll go back into the same payment form looks like this however if I go into another type form let's go into the scroll all the way down into the one that's right next to it let's look at this one spend money form which is it in essence like a check form or a form that decreases the checking account directly but the other side's not generally going to a payable it looks like this and that's where you've got the account that's going to be affected on the other side with a payment form we know what the other account is it's accounts payable because that's that's the point so it gives you a little bit more detail although both of them are going to be decreases to the checking account I'm just trying to find them both here again so that's the general idea then of course the subsidiary ledger accounts will be impacted as well because now we've decreased this payable account it has a sub ledger breaking out who we owe the money to which we saw here so let's update this report so I'm gonna say let's update it and then if I scroll down notice that the AAA is gone because I no longer owe them any money so this report removed it entirely we might talk more about like modifying the reports and the detail reports in future presentations but just note that if I go all the way down to the bottom the point I want to make here is that the 10,291.84 broken out by who we owe the money to vendor or supplier in other words ties out to what's on the balance sheet or should 10,291.84 and this is the 10,291.84 now when we're actually paying the bills we will go over here to our activity and be sorting our bills typically with this pay bills area as we saw which is kind of breaking out the same thing it's giving us basically a sub ledger the ones awaiting payment then you would think in essence would add up to the accounts payable but it's not the same as a form because it doesn't give us the total or and or we would be going into the contacts and let's go into the suppliers vendors suppliers people we buy goods and services from here's the AAA if they have questions about us they say hey you didn't pay us or something like that we could say okay let's go check it out and this is where we would go to to you know talk to them about this that it says here that the bill have been paid so we have the bills been paid it looks like to us we can view the item on the drop-down and we've got the bill here and we've got the history that we can check out on down below related to it created approved paid and so on so that will help us to track questions if people come back to us with questions about it