 QuickBooks Online 2023. Create reports after second month of data input. Get ready to start moving on up with QuickBooks Online 2023. Here we are in our Get Great Guitars practice file. We started up in a prior presentation with the 30 day free trial. We also have opened the free QuickBooks Online sample company. If you want the to open at the same time we suggest using incognito or you can use another browser. You can open incognito window if you have Google Chrome with the three dots in the browser and then incognito window type into the search engine QuickBooks Online Test Drive. We're using the sample company to compare the accounting view the one Get Great Guitars is in and the business view the one the sample company is in. You can toggle between the two by going to the car drop down and switch the view down below. We're going to be duplicating some tabs as we do every time fairly quick because we do it every time. Right click in the tab up top to duplicate it and then we right click on the tab up top and duplicate it and then we go back to the tab in the middle down to the reports on the left open up one of the favorites the two major financial statement reports the balance sheet and then if you're in the other view by the way the business view that is it's in the business overview and the reports that's where the reports are located back to the accounting view that's not the accounting view 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 k the heck passo dang it that's not it either here we go back to the report to the right we're going to go down to the reports and then open up the profit and loss reports and let's close up the hand boogie and do a range change from 010123 to 022823 and then we'll hit the drop down and change it to months and run it so we've got the month by month side by side jan feb tote and then up to the top closing up the boogie and change the range from 010123 to 022823 and run it run nine at this point in the practice problem we've done two months of data input let's just do a recap of the business and bookkeeping goals the business goal in general is revenue generation which we can generally see on the income statement that's the top part of the income statement the income line items on the income statement that's what we're trying to do here everything else on the income statement is in essence some kind of expense we have some other income down here but generally everything else is an expense those are the things that we consumed in order to generate the revenue typically in the same time frame when we look at the balance sheet we can break that down to the accounting equation assets equal liabilities and equity the assets are things that we have in the business as opposed to in our personal uh possession because they're going to be like investments that are used to generate revenue such as investments in property plant and equipment that we're going to use in the future to create revenue the liabilities and equity are how we're financing the assets that we are investing in the business to use to generate revenue liabilities representing loans and stuff that are claims to those assets by third parties the equity representing our portion of the assets which could be generated either from us making an initial investment or through the accumulation of revenue that we've had retained earnings earnings that we're keeping in the company that we haven't distributed in the form of dividends or draws in the case of a corporation or sole proprietorship respectively so let's just take a quick recap if we look at these line items and think about how each of those these accounts have been built we'll do it a little bit quicker this time because we did this after the first month but I think it's useful to see what the end product is because from the bookkeeping standpoint what we're trying to do is one make the end product of the financial statements balance sheet and income statement and two try to facilitate the transactions as easily as possible to have foster a good relationship with people we're doing business with customers vendors and employees and also to make it so the business itself can focus most of its time not on the bookkeeping but on whatever the business does to generate the revenue the revenue generation is the key otherwise the business does not thrive obviously so if so this is going to be one of the end results the financial statements that we might at least need to use for taxes if not for external reporting purposes now of course the cash account that's the lifeblood of the company so if I look at it if I drill down on the cash account at this point in time there's more types of transactions in the cash account than any other account so this looks like a very convoluted account and because it's the top one on the list we start to think that the whole accounting system is quite chaotic but that's just because the cash is the lifeblood of the company it runs through every cycle vendor cycle customer cycle employee cycle and that's why the reconciliation of cash that we'll do shortly is so important because it not only double checks the cash balance but all the transactions that are running through cash so that's going to be a huge internal control we'll talk about later and then we've got the accounts receivable which is a good example of an accrual type of account meaning it's an account that deviates from a general cash basis meaning it has some transactions in it that have nothing to do with cash like an invoice doesn't have any cash involved but we still need it if we're in the type of company that has to track accounts receivable that would be one where we do the work first and we gotta bill the client or send them an invoice receive the payment and then make the deposit now clearly the accounts receivable is a lot less chaotic it goes up with an invoice it goes down with a payment we've done two months that's all you see here that's all you're gonna see in the accounts receivable generally the accounts receivable has the subsidiary reports tracking the information not only by date which is what that transaction detail like a general ledger did but also we need to track it by customer we've got the inventory the inventory we can track different ways we're we're tracking it with a perpetual system within the quickbook system kind of the more sophisticated way to be tracking inventory but it takes a little bit more setup process to do in the inventory account we would expect we have the starting amounts this is when we set up the inventory balance to just start out with we're gonna buy the inventory with checks or with bills or with expense forms and then we're gonna sell the inventory with invoices and sales receipts so that's what you would expect to see in the inventory account it goes up when we buy it we buy stuff with check forms expense forms or bill forms and then we sell this inventory with invoices and sales receipts it's gonna go back down and then we might have inventory adjustments that need to happen periodically to tie up the inventory to the physical count remember that the inventory also has a sub ledger breaking the inventory out by units if you're tracking it on a perpetual inventory system the payments to deposit account is that clearing account notice it just goes up and down goes and so we expect the same kind of things to happen we have payment forms sales receipts increase in it and then we make the deposit and after we make the deposits it should go back down to zero as it does periodically here through our our practice problem that's what you would expect to see there if you don't see that there's probably a problem and oftentimes people have problems with that particular account short-term investments whether it was an investment account that we closed out here so I won't go into that in detail the furniture and fixture or our fixed asset accounts notice that in this account it's not something that we do all the time because we don't purchase furniture and equipment all the time so you don't expect to see much activity in here and what you would expect to see is purchases typically with expense forms if you paid cash or check forms or you might purchase and finance the equipment which means you might have an increase due to a journal entry this is the one that you want to have detail in so that you can provide the documentation to your to your accountant so they can give you the information necessary to record the adjusting entries and we'll talk more about that later this is a type of a cruel account by the way so which is which means we have to put it on the books as an asset even if we paid cash for it and you can't really deviate from that even if you're on a cash-based system and it's because there's such a big difference between when you buy something and when you're going to use it that you have to deviate from a cash-based system or your books are getting quite distorted in timing differences so that's that we'll talk more about it when we get to the to the uh adjusting entries uh section or course accounts payable you'll expect the accounts payable to be going uh up with a bill down with a bill check that's all you expect to be seen typically in the accounts payable it's another example of an accrual type an account it's another example of an account that has a sub ledger like the accounts receivable broken out not by customer this time but vendor the credit card we didn't have a lot of activity in the credit card but it can be treated like a checking account if you use the credit card a lot functioning in a similar way as a checking account except that the the liability goes up when you purchase stuff instead of the cash going down we'll talk more about that when we get to the bank feed course or section and then we've got the loans we put the two loans on the books so let's look at the big loan here so the loans aren't something that we take out all the time but once we make loan payments if it's an installment loan we would expect the loan payments to happen periodically say monthly for example and they're gonna have a similar structure although the amount that's broken out between principal and interest will differ so we've talked about some different kind of strategies you can have for making those payments and then we've got the taxes so the taxes are going to be processed through payroll if you're running payroll through the system I won't go into that in detail but it's got a lot of sub ledgers and what not related to it to comply with the laws and then the equity section let's go down here net income is how the income statement is tied into equity this is what we have earned so that increases equity so that's how we are now financing our assets in part through the income that we've earned through the business which we're not which we have not yet given to the owner in the terms and the form of dividends or draws in the case of a sole proprietorship this owner's equity is represents the the amount that we've earned that we haven't given back to the owners and the investment you could break out separately but you might just put that into owner's equity if it was a sole proprietorship and then we might have draws that we'll talk more about later that would be us taking money out of the business reducing the equity section the income statement is tied to the equity section the net income it's part of the that's how it's part of the so this is where we stand as of a point in time the story of how we got there is the income statement which has income and then expenses so top line income line and the income lines would go up as you would expect with just invoices and sales receipts now if you're in some kinds of businesses it might go up with a deposit if you're just if you're just using bank fees to record it but if you're using a full service accounting system we would expect income only to go up and we would expect it to go up with just the sales forms invoices and sales receipts that's it we wouldn't want too many accounts for inventory typically just a major the major accounts there are exceptions to that rule such as if you're doing gig work and you're doing deposit forms you might label the names of the accounts by by customer but that but if you're using a full service accounting system with invoices and sales receipts you want to generally have a limited amount of income accounts usually because you then have the sub ledgers that you can use cost of goods sold is a special expense account related to inventory we're using a perpetual inventory system you would only expect it to go up in general and it would only do so with the invoices and the sales receipts because those are the sales forms that in a perpetual inventory system are are going to record the expense of us selling the inventory and then you've got all the other expenses down below again expenses all income statement accounts usually only go up and then you got income minus expenses is the net income so you've got all of our expense we've got the comparison accounts there we have our total down below now when we give these reports now to a third part to like the to our client let's say now we have to think about how we're going to present these to our client because we have to pick which reports we want to give number one and number two now we have multiple periods so we could have comparative reports that we can add so remember how we can structure this we can generate the reports i'm going to memorize the reports i'm going to memorize them on a monthly basis then i can get into them easily and provide them to the client either by by emailing them printing them which is less common these days or we can save them as a PDF file and then possibly email them with multiple attachments but that's still kind of tedious we could zip them which i think is a better solution or we can we can also create an excel file we can also put them on the cloud so that they can access them on a cloud drive we can make an excel file and then generate one PDF file from the excel file or use excel and word to create a sophisticated more sophisticated and customized format or if i go to the first tab we can go down to the reports on the left hand side we can use this this manage reports tool to try to customize our reports so let's first just group and memorize our reports i'm going to go into the custom reports here last time we set up the balance sheet report a summary balance sheet and the balance sheet standard balance sheet and then a summary income and and an income statement in general so we've got the general reports now those reports if i go to the let's go to the tab to the right right click and duplicate just so you can see where those are generated from if you wanted to pull those up i went to the to the reports on the left hand side we went into down here there's the there's the balance sheet standard of course and then hold on a second here let me scroll down a little there's the summary balance sheet now the summary balance sheet is just basically a balance sheet report but it only has the account types instead of all the detail so that's a good report to start with and and then i customized all the reports by doing our standard i'm getting rid of the pennies negative numbers i'm doing and i'm and i'm doing the red numbers and i'm getting rid of the date time report basis so that's my standard formatting that i've done so that would be the summary report what it's going to look like and then if i go back into the reports we have of course the income statement that we put together the profit and loss and the summary income statement i just collapsed some of the the total lines so we'll look a little bit more about them later at them a little bit more later but now let's do a couple comparative reports and add those into the mix here so i'm going to say let's say that i want now that i have two periods i'm going to say all right well let's go into like a normal prompt let's do a normal like balance sheet report and then i'm going to say okay let's see if there's a couple comparative out reports that we could make if i wanted to make a side-by-side comparison of the two periods that i have now i could do this this way i can go from 010123 to 022823 and then i could hit the drop down and say that i want to see it months a month by month and again you could do it week by week that's more less less common if you had multiple quarters you can also run one quarter by quarter and you can also do it year by year if you had multiple years so you can see how much many more options we have as time passes by just manipulating these reports to have comparative options to them so i'm going to do the quarters and run it and not quarters what am i doing months and then run it so now we've got the side-by-side of the balance sheet january in february it puts the older month first and if i have multiple months like three months then i can do three months on the same report but if i only have two periods then it's often useful for me to do it a different way and take the difference between the two so i might say okay maybe i'm going to go back to the total this way and then the way i can do the difference is i can run it for the second period which in this case is 0201 23 so just for the month of february 0201 so just for the month of february now which is the end of february of course because it's a balance sheet and it's a total only but then i'm going to select the drop down and say that i want to see the previous period which is january and then i can also pick the dollar change and the percent change and run that so now i've got february first the current period the prior period the difference and the change and i can call this something like maybe a comparative comparative balance sheet and so again we only have two periods now two months but if we had multiple months you can imagine doing multiple comparisons for different months different quarters quarter by quarter and so on and so forth so you can start to think about how what kind of reports you would have at the beginning of the year versus the end of the year and what kind of reports you might be comparing to prior years as well there's also a question now of should i just give them this report which gives them the total balance sheet as well as a summary balance sheet which is kind of redundant and a standard balance sheet which is kind of redundant sometimes it might be useful to do that because it's easier to start out looking at a summary balance sheet and then expand on the detail go into a more longer balance sheet the standard and then go into something like this which is a comparative balance sheet if i but but you might say hey maybe i just want to give them this because it has all the information in there and given them the other reports is redundant in my experience the redundancy is good if you're doing a presentation for example or even just given the reports to someone oftentimes because you don't want to overwhelm them with a report with too many numbers you'd like to impress them with a report with too many numbers but you probably want that one buried somewhere deeper into the into the stack of reports and have the top report be as simple as possible because that might entice them to actually look at it for a little bit more than a second before they roll their eyes so in any case i'm going to customize this up top and then let's say we're going to get rid of the sense and bracket the numbers and then we'll say that i'm going to say headers and footers get rid of the date time report basis i'm going to run that and then i'm going to go back to the first tab and see where i want to save it i'm going to save it as like a balance sheet number number i want to make this one well i'll make it number five report i'll just make it number five so i'm so i'm going to try to cut number them so i'm going to save customization i'm going to make it just number five report and i'm going to put them under the report group that i made here month in report so i can pull them up each month and just generate them so i'm going to save that so then if i go back to the first tab and refresh it it's going to go into this customized customized area so now i can just generate it each month and just change the dates here which we'll do in the following presentation all right let's do another one for the income statement so i'm gonna let's let's just i'll just hit the i'll just do right here reports and let's do an income statement a side by side income statement income statement and so now i'm going to say i could do the same thing here on the income statement note i could hit the drop down well let's change the range first don't get ahead of yourself 010123 but myself is so slow i hate waiting for myself anyways so i could do it this way and then i can do the month the side by side as we saw now this is more better this is more better for the income statement because now you've got a january and a feb and it gives you the total so that's great because an income statement is a timing statement it didn't do that with a balance sheet because the balance sheet is as of a point in time so now this report and a comparative report often would be good like you might run something like this for multiple months or multiple quarters that has that has each period and the total which is great and then you might do a comparative report comparing two periods so i'm just going to do the comparative report for our purposes so i'm going to go up top we can do the same thing on the comparative side going back to the totals i'm going to run it and i'm going to do just the month of february 020123 i think my voice is going don't go voice i need you you're all i got you got it so we're gonna hit the previous period and then we're gonna say let's go the dollar and the percent okay so there we have it so now we've got february 1st january and the difference so that looks good and let's do the customization up top and get rid of the uh the the all right it's already there now i'm gonna say without sense because i i kept the other report okay so the formatting is done okay so let's run that so that looks good and then i'm gonna call it i'm gonna call it a comparative comparative income statement i think i ran this not from a standard income statement but from my customized area so in any case that's the idea and i'm gonna customize i'm gonna save customization see yeah i did i'm gonna save it as number seven i think we're on now number seven i think comparative income statement let's see if i messed it did i mess everything up you bested all up you knocked over my sand castle again i didn't mean to where's that one should have been number number six let's edit it all right let's save it okay all right let's go back to the tab so that looks good let's just run our transaction detail report now which is not a report that we often provide to the client but it's a great report for internal reporting and we might use it for billing as we've discussed in the past so i'm gonna right click on the tab up top and duplicate it and let's first i'm gonna look at the trial balance and then our transaction report so we're gonna go to the reports on the left hand side and then i'm gonna close this up open up the trial that well i'm gonna go to the standard reports open up the trial balance the trusty trial balance and then run that from 010123 to 022823 run it and so this is where we stand as of this point in time so if you're checking your numbers you can check them to this report this is not a typical report that we provide to the client because it's got debits and credits and the whole point is to try to use the debits and credits to make the final product but not give them debits and credits because they don't understand the debits and credits and maybe we don't typically need to fully understand the debits and credits but it's still a useful uh report the debits and credits are actually a more a more quicker and easier way to look at things a lot of times uh actually as you can see with this report being a lot more streamlined than the balance sheet and income statement themselves in a lot of ways so let's now then right click again i need some coffee my voice is my voice is going don't do it voice don't go don't go i'm gonna scroll all the way down to the bottom and then we're gonna say for my accountant so we got the general the journal report and we which is a similar report transaction list by date that's the one we're gonna take a look at it's a little bit more streamlined than the journal report let's open that up i'm gonna make this let's make it just for the month of february so i'm gonna go from 0202 that i said 0201 23 to 0228 23 run it and so the way this the way this works is if you look at the trial balance here let's run the trial balance on a side by side month by month and if you run your trial balance and as of the end of january and your january numbers tie out to our january numbers then if then the difference between january and february is reflected by the transaction detail report meaning if all of your transactions in this report match hours then we have to be at the same end point which is going to be february now it's a little bit difficult to to kind of check all your numbers on the transaction detail report because as we saw before it has just the date the transaction the the name and then the account the primary account and then the split account it's a little difficult to see sometimes because sometimes they just have a split if there's more than two accounts affected but this gives us a nice quick summary that you can look at and and say okay if there's something on my side that isn't on your side then you might need to you might need to expand the date range and see if it's a date issue and then you might need to add that if there's something on your side that's not on this side then you want to see what happened is it a duplicate transaction or was it miskeyed or something like that and then check your numbers in that way this is also a good report for like i say billing possibly because you might try to bill someone instead of by hour by how many transactions you enter let's just open the one last report the journal report i'm going to right click and duplicate this i know i'm going long here so i'm going to do this fast and i'm going to go to the reports on the left hand side and close up the boogie close up the boogie and my i have to wrap this up because my voice is threatening to leave me i'll give you some coffee voice and i'm going to go into the the journal report this time and this is let's make this from 020123 to 022823 and so now we've got a similar report but this gives you all the details gives you the the transactions that we did and then it gives you like the detailed accounts that were impacted from those transactions instead of just giving you a split line this is also a useful report possibly for billing in that you can see you can kind of take into consideration how many accounts were impacted in your billing structure and you might do this by exporting it to excel to use excel to count all the lines right you don't want to physically count all the lines but you can export them to excel and use some count if functions like count if there's something in there to count the lines so let's just scroll through this it's quite a long report of course and so there's that now next time we'll get into now that we have our reports in our custom area here we'll get into actually grouping them together to provide them to the client