 QuickBooks Online 2023 bank rules. Same vendor filter by amount. Get ready to start moving on up with QuickBooks Online 2023. 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 than 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 bank feeds practice file. We started up in a prior presentation using the 30 day free trial. We also have open the free QuickBooks Online sample company. If you want the to open at the same time we suggest using incognito or another browser to open the sample company. You can open incognito if using Google Chrome with the three dots in the browser incognito typing into the search engine QuickBooks Online Test Drive. We're going to be using the sample company to compare the accounting view the one the bank feeds practice files in and the business view the one the sample companies in. You can toggle between the two views by going to the cog up top switch that view down below. Let's go ahead and duplicate some tabs like we do every time right clicking the tab up top to do so so we can duplicate it then we're going to right click on that duplicated tab so we can duplicate it then we're going to go to the middle duplicated tab down to the reports on the left open up the balance sheet the famous balance shirt by the way if you're in the business view the reports are located in the business overview on the left and then the reports just so you know where stuff's at you got to know where it's at tab into the right going down to the reports in the left this time the P to the L the profit to the loss the income statement closing that burger up and changing that range from 010122 tab 123122 tab run into refreshing and then tab into the middle and then closing up the hamburger again and changing the range in 010122 tab 123122 run it to refresh it let's open up the the bank feeds to because that's where we're working on tapping to the left to do so banking there it is banking tab up top if you're in the business view by the way where are the bank feeds they're under the bookkeeping of course transactions up top and the bank transactions that's where they're at okay this time we're going to be looking at a situation in our bank feeds with a little bit more complex type of rules related to a decrease in the checking account for a particular vendor that we might be buying multiple stuff from so you might for example be buying like when you pay for a vendor that's like the phone company like that's quite simple everything goes to the telephone expense the utilities goes to utilities but if you buy stuff from amazon or like office depot or staples an office supply store or something you might buy some stuff that supplies you might buy some stuff that's equipment you might have different categories for the same vendor what do you do with those people because i want to automate things i want to make it automatic i wanted to just flow in from the limbo situation and not have any of these transactions have to go through the the strain of being in bank feed limbo so they just go right into the promised land creating the financial statements so how could i make rules to do that well one way we can do it is we could say that there's going to be a a dollar limit so if it's under a certain dollar limit then you're going to record it as say an expense if it's over a dollar limit maybe then a fixed asset now as i think about these fixed assets depreciable assets you might call them note that some people you might have this idea you're going to say hey look i'm not doing this accrual thing it's too confusing i just do a cash-based system i don't want to do accrual stuff but some accrual things you're going to have to be forced to deal with one of those is usually going to be the depreciable assets and most of us our cash basis concept kind of clicks over to having this accrual concept just because of the extremeness of of the situation and the tax code also will force you to do this accrual thing meaning if you were to buy like like an office building or a forklift for like a hundred thousand dollars and just expense it on a cash-based system what would happen on the income statement is that if you were to compare say january and february you bought a hundred thousand piece of equipment in january for cash and expensed it then you're going to look at your income statement and january is going to look a lot worse than february even though you're going to use that equipment for the next 30 years or something like that so that really messes up your analysis the traditional analysis of the income statement which is supposed to measure performance you didn't perform poorly in january you just happen to buy a piece of equipment that you're going to be using for multiple periods into the future that's why you put it on the books as an asset and then allocate the cost in theory in practice a lot of times we do that also because we're forced to of course buy the tax code but we even if on a cash basis we generally have this idea if i buy a building if i buy a large piece of equipment it should be on the books as an asset not an expense when do we expense it when we depreciate the asset allocating the cost over the useful life expensing it in the same period that it's consumed in order to help us to generate revenue so we can compare different income statement amounts and measure performance so we can improve going forward okay that's the general idea let's go back to the first tab how do we do that well let's go into the office depot here and say i'm going to add office depot as the vendor and so it's going to be a vendor boom and then if it's under a certain amount like this one is i'm going to say it's just going to go to office supplies so i'm just going to say that one's good supplies expense let's do that and then i'm not going to sign a customer class i don't need a class so i'm going to say that's good and then let's make a rule let's make a rule so i'm going to say rule office depot it's going to be a money out rule and i'll apply it so all of the conditions have to be met there's going to be multiple of them this time description i like using bank text we're picking up contains office depot nothing new nothing unusual about the rule thus far but we're going to add another condition this time this condition is going to be a amount condition and i'm going to say this amount has to be under some value less than so i have the options of equal greater than or less than i'm going to say less than and then i have to pick a somewhat arbitrary uh number here so you might pick like a thousand dollars whatever you think is a relevant number you might say well which when is it relevant to to put things on the books as an asset in theory if you're going to use something for multiple periods into the future that's the thing that should be telling you whether or not it should be an asset assets versus an expense there's not really a dollar delineation but in practice of course you would think when it becomes material like when when you would think there's a there's a difference in how you would look at your financial statements if something was recorded as as an expense versus an asset right when that might be like a thousand dollars for some companies maybe you would think it would it would be more like two thousand dollars or three that whatever i'm just going to say here for our practice purpose we'll pick up a thousand dollars so i'm going to say a thousand dollars it's got to be it's got to be under a thousand dollars to be a supply if it's over a thousand dollars i'm going to make it possibly an asset account or at least check it out meaning this rule will not apply then if i have something from office default that's over a thousand and maybe i just say that's the only rule i want and then i'll just be able to double check the ones that are over a thousand before so it won't automatically add them or i can create another rule saying if it's over a thousand dollars i want you to then apply this other rule so we'll do that in a second i can test the rule it applies to four transactions that looks correct i think expense form is being used supplies account office default the payee i'm not going to auto add the rule but turn that off so i can double check it before they are pulling these stuff over into the promised land so i'm going to say save it and let's let's sort this by the rule recognize transactions and so if i go here so these are going into office supplies i'm going to choose this one hold down shift and select this one so these are all being added and that's good so let's go ahead and accept these of course that'll be a decrease to the checking account so nothing really unusual i don't really need to dive into that i don't think but the so what we're going to look at is the tab to the right and then the income statement account of supplies has been impacted so nothing unusual about that rule except that we added that other component so that it's putting these items in here only if they're under a thousand dollars let's look at the differentiating factors the ones that are over a thousand dollars which did not get added because the rule was not applied to them so i'm going to unfilter these two the rule didn't apply to them now you could just leave it at that and you could say okay now anything that's over a thousand i want no rule to apply to it because i want to double check those transactions given the amount the fact that the dollar amount is significant also note that you might want to kind of double check the amounts that are over a certain dollar amount that are going to be in fixed assets as well because when you're giving this information to your accountant and tax preparer at the end of the year that's usually when you're going to be accounting for the depreciation schedules in other words we don't usually track depreciation schedules within quickbooks because oftentimes you're going to have to do it anyways in the tax software for tax depreciation tax depreciation often being different than book depreciation so it's in the tax software often has the capacity to track book and tax depreciation so when you're setting up your your fixed assets you want to talk to your tax preparer and accountant and they and say hey how are we going to track our fixed assets uh in the system here and and then try to figure out your accounts that you're going to be setting up and then also what information they need when you're going to be adding fixed assets each year noting that you don't buy fixed assets all the time you don't buy forklifts every day that only happens maybe a couple one or two times a year right so that means that it should be it's a little bit more maintenance to deal with those large transactions because you have to put them on the books as an asset but it shouldn't be too tedious because you only really have to deal with the new increases and decreases increases when resistance to the purchases of the fixed assets and make sure you give that information to your tax preparer giving them not only the dollar amount in a general categorization of equipment but as much information as you can give them to distinguish the actual thing you purchased if you purchased a forklift they want to identify the actual forklift with the number serial number or something like that so you can actually identify what's on the depreciation schedule to what's on the books you also do not want to be grouping on the depreciation schedule general categories with multiple things in them such as this this contains five five computers or something like that and one dollar amount because then if you sell one of those computers or if you said five forklifts and one dollar amount for five forklifts then when you sell a forklift in the future you're not going to be able to determine which one you sold and it's going to be a mess so that's a couple things to be aware of so so you might want to keep the documentation for these items to make sure you can provide that to your tax preparer so i'm going to open this up but i can also apply a rule to it it's going to be a similar looking rule i'm going to say create a rule and then uh office depot let's say over 1000 and then i'm going to say description text i'm going to say office depot and then a money rule so an amount rule if it's under if it's less than i'm going to say 1000 now you might say well what if it's equal to 1000 it's not likely you're going to have a transaction equal exactly to 1000 but then then uh one of these uh one of these rules wouldn't apply you could make another rule to say well what if it was equal to 1000 just so you can cover all your bases but but you're probably safe with with these two rules that will will pick up everything uh and so i said less than it should be greater than greater than gravity get your head in the game dang it greater than a thousand dollars these are the ones that are going to be applied or to equipment all right and then the category the category shouldn't be supplies this time i need to fix that it's not going to supplies i don't have any fixed asset account yet so i'm going to add an account on the fly as we go new account it's going to be a fixed asset type of account fixed assets and then it's going to be a fixed asset depreciable asset i'm just going to pick one of these because i don't want to that subcategory doesn't matter to me too much but the equipment equipment just make sure when you're when you get this these fixed asset categories given to you by into it note that if you give if you use their generic categorization i don't think that's often an ideal categorization for many small businesses because it doesn't it won't line up oftentimes to what is on the tax software's sub schedules which you're going to use to calculate the depreciation so i would highly recommend when you're setting up a new quickbooks file you talk to your your accountant and see what categories are in are in the the software that's going to be used to calculate the depreciation schedules and use those categories so that your information in your books lines up to the general categorizations you're going to use for the sub calculation for depreciation schedules the sub ledgers so just a word of advice there but in any case we'll do that and say save it uh it doesn't like something here another account already has that name i already have an equipment account set up really i didn't see it i'm going to close it out and say let's say category it's going to be equipment equipment there it is i do have one of those movie b to the end all right office depot everything else looks good so i'm going to save it and then let's sort by our rule recognize the transactions there's the two go into the equipment so i'm going to select those two and then and then accept them and then if i go to my balance sheet running it now the checking account will be impacted and the other side this time even though it's the same vendor but the different rule applied it's going to a fixed asset or it should be did i refresh refresh this thing is this thing fresh is this a fresh uh report there it is fixed assets down here equipment boom so now it's on the fixed assets and there's our detail now remember at the end of the at the end of the of the year you're probably going to give to your tax preparer this information which shouldn't have too much detail because you don't buy and sell equipment all the time and you might want to give them more detailed information about the actual things that you purchased and possibly the financing of the things that you purchased so that they can put as much detail as possible in the sub ledger listing out the actual units of equipment you purchased like forklifts like computers like you know whatever it is that's going on the books and and then think about how you're going to be recording the depreciation either on a tax basis or see if their software can also calculate a book basis if you want a difference between the two and then possibly do an adjusting entries you know periodically for the accumulated depreciation that's when you're going to record this amount as an expense because you might say well what don't i get a tax write off or something don't i get an expense for the equipment you do but it's not going to be called equipment expense it's going to be called it's going to be called depreciation expense over here which is an adjustment that happens you know periodically note that if you don't do that and you and you just put everything into supplies expense those high dollar amount items then you're going to be misstating your your income statement first of all because that will distort your comparison between one period and another because you're really buying those items that are going to help you for multiple periods into the future and for taxes that could be a red flag to like auditors they might compare your the kind of industry you're in to other types of industries and if you've got this wildly high dollar amount in supplies or miscellaneous or office expense then that could be a red flag you know for for an audit for they can come in and check that out and say well yeah you should have put this on the books as an asset and depreciated it so we're going to you know do that now and you owe us money you know you know how it goes so that's the general idea with that one