 QuickBooks Online 2023, account and settings, expenses, payments, time and advanced tabs. Get ready to start moving on up with QuickBooks Online. Here we are in our Get Great Guitars Practice file we set up in a prior presentation using the 30-day free trial. We also have open in another tab the free QuickBooks Online Test Drive Sample Company which we will use primarily to look at the differences between the business view and the accountant view. We're currently in the business view as can be noted by the icons on the left. I'm going to go to the cog up drop and switch to the accountant view, my preferred view but as we go through items in our practice problem we'll try to toggle back and forth to see where things are located under both the accountant view and the business view so you can use whichever one that you prefer. Note that if you also want to have the free QuickBooks Online Test Drive opened you've got to open it typically in an incognito window or in a different browser if you're using Google Chrome you can do that by hitting the three dots up top and open up a new incognito window and then you can search for QuickBooks Online Test Drive or if you're using Google Chrome for example you can open it up in another browser such as Firefox. Quick overview of our objective business objective revenue generation accounting or bookkeeping objective to facilitate the financial transactions to create the financial statements balance sheet income statement or profit and loss and related reports as easily as possible so that the business can focus on revenue generation 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 and not on the bookkeeping process also our job is to make it as easy as possible to communicate as we record financial transactions with those we do business with customers vendors and employees to do that we set up the QuickBooks file we're then going to be setting up our settings as we are looking at now we're going to be doing those fundamental foundational things like the lists setting up our chart of accounts setting up our products and services and then we can get to the day-to-day activity of entering the financial transactions which we primarily see under the new button and we then have our transactions here which the data input forms we're going to try to make as easy as possible so these can be used to create the financial statements balance sheet income statement or profit and loss and related reports then we communicate with the people we do business with with the information on the left such as the sales area which I would call like the customer center for example the expense area which I would call say the vendor center and the payroll area which would be the employee center for example so that's the general idea going back to the dashboard we are now in the cog drop down looking at our settings I'm going to keep on going through the settings for this foundational items when we set up the new company file last time we got down to the sales area this time we're going to the expenses and we're going to go all the way through to the advanced so expenses this is going to be kind of like the cash outflow side of things so these are going to be the check forms the expense forms the bill forms at the end of the cycle we would expect money to be going out for these items so you got bills and expenses so show items table on expenses and purchase forms so that's going to then add a purchase product table on the expense and purchase forms so you can itemize products and services that's on by default we will keep that on as the default it says show tags field and expense and purchase forms so let's you let's you add tags we're not going to be dealing a lot with tags because that's going to be another kind of specialty area we might have another section on tags in and of themselves if you're not using them you could turn that off because it'll be a little less busy I think QuickBooks is trying to kind of promote the use of tags because that's a differentiating thing that they have than many other softwares but again it's kind of a specialty area so we won't be using it for the most part in this practice problem track expense and items by customer adds a customer column on expense and purchase forms so you can track expenses and items by customer so let's check that that went out a bit more in a bit more detail if I close this back out and I was to open say an expense form a check or a bill type of form let's open like an expense form for example you can see here it doesn't have any customer field on the right hand side by default the vendor is who we're paying up top now I could add a customer field so that I can then then add the items that I'm paying for possibly to an invoice in the future you got to be careful with this we'll talk about it more in the future but to do that I can close this out and we'll turn this one on cog drop-down account and settings and I'm gonna turn that on expenses and then we're gonna go into here and it says track expense and item by customer I'm gonna turn that on make expense and items billable so this one it says adds billable column on expense and purchase forms so you can add billable expenses and items on sales forms so let me turn that on and I'll show you what I mean by that and then you've got your added options make expense items billable but before I get into that let's just look at this first let's save this and look at the impact I'm gonna close this back out again and then I'm gonna hit the plus button and go into that same expense form this is a form we typically use kind of like a check form and we would have a vendor up top for something that we're paying for you can see now we have added a billable item and a customer so why would you need a customer if you're dealing with an expense form well possibly I'm in a system where possibly it's a job cost system and I'm paying for expenses that I I'm gonna apply directly to an invoice so I want to have an expense that's gonna be recorded here that next time when I make an invoice for the customer that I apply this expense to it will then pull in as a line item to that customer now you got to be careful with that because the question then is when I pull it over to the invoice where it we're not using items to do that so when I pull it over to the invoice I don't really have a formal item so the question is how is QuickBooks gonna record it is it gonna record it as income or a reduction to the expense accounts you gotta kind of be careful when using that that tool although it can be an effective tool will dive into it a little bit more in a future presentation we will keep that on for now and touch on that in our practice problem so I'm gonna hit the the cog again and then go to the account and settings and now that we have some understanding of that let's go back into the expenses then you have the added options here so you can make expense and items billable you can mark up with a default rate so now that we've determined that we're gonna have some expenses that we might apply to a customer so that we can pull them over into an invoice do I want to pull them over at what we paid for it or maybe I'm have a standard markup I mark it up by some percent when I when I when I invoice the client so I have a standard markup for those things that I've been purchasing so and the other way you can do it is have the cost there and then just add your markup to the total of the invoice which might be another way you could do that track billable expense items as income so when you when they pull over to the income side when you invoice them you typically you would want them to show up on an income line you're not typically gonna want them to be like a decrease in an expense so if you paid for like supplies expense and then you added supplies expense to the invoice I don't want the invoice to then record a decrease to supplies expense I wanted to record income typically so you have income minus the expenses your net income that's usually how you'd want to see it so that gets a little tricky because you're not using items so we have here track so in a single account or in multiple accounts down here adds a use for billable expense checkbox to an accounts edit screen in the chart of accounts so you can kind of apply where you want it to go more clearly here so we'll keep the defaults and then you've got the charging of the sales tax and so sales tax obviously is gonna muddy up the situation when you have to determine whether or not when you pull it into the invoice is it now going to be applicable to sales tax or not so you can turn that on if so you got the default bill payment terms so this is kind of like we saw on the invoice if I enter a bill into the system that means that I'm gonna pay it at a future time now the term bill for QuickBooks is a very specific term so we can use it in a lot of different ways outside of Quick Books even in accounting but for QuickBooks it means we got a bill from the customer and we're entering it into our system before we pay it we're not just gonna pay it with a check we could get an invoice or a bill from a customer and pay it with a check which means we wouldn't use the bill form if I enter it with a bill form that means that we're gonna pay it in the future now it doesn't have a default here because you know you're probably gonna have to enter the manual bill date of when it is due rather than just give a default here because we're the one receiving the bill but I'm gonna put a default on it in our practice problems so we can just see so it'll generate that automatically for us so that's gonna be when it's gonna be due by default let's save it and then you got the purchase orders now the purchase orders would only be in place if you're in a system where you have inventory and you're able to basically request inventory without actually paying for the inventory so it's a request kind of form to your vendors before you before you enter the bill or the the check form or expense form for the inventory so use purchase orders so if you don't use them you could turn them off and then you won't have that added kind of item it'll be a little bit less clutter possibly go to the to the list you can customize the field to manage so if you wanted another line item in the invoice form that that that you can sort by you can add that custom transaction numbers lets you use your own number I'll keep it where it is by the default and then the default message you can add a message on the person purchase order here by default and test that out if you want as well so I'm going to save that and then you've got your messages so remember with communication oftentimes is done by email now so we've got the default messages when we send out the email default email message sent you've got dear and then you can have full name first name company name and so on this is for the purchase order email please find purchase order attached to this email so you can change that the default if you so choose email me a copy so you can put that there if you want to have a copy the CC and so on if you want to have those as well so I'm going to say obviously the CC is visible and I think the BCC is not visible so that so that you can add it without you know someone else seeing that you added and so on and then you've got the quick books payments so get paid more ways so if you go into this is kind of like an add-on type of feature we might do another kind of section on it but you would have to to set up online payments in order to use basically this feature so we might test that out later but not now and then the time if we go into the time in general the first work week so we started on Sunday is the default but maybe you started on Monday so you can set that as default if you want first day of the work week and then the timesheet shows service fields when entering timesheet lets you specify service performed so the time when we enter the time that's going to be the time that we enter that we might use for payroll and we might also use that to process an invoice which is quite common in like a job cost kind of system or like a an accounting firm or a law firm where you're going to be charging the time and this will when entering time let's you specify the service that's performed allow time to be to be billable so when we enter the time as a checkbox to specify whether the activities should be billed to the customer so if we're entering the time because we then want to pull that information in a similar fashion as we saw with the expense form into an invoice then we want to be able to assign the customer so that we can then pull that information over we'll touch on that in the practice problem show billing rate to users entering the form so we'll keep that off by the default let's go into the advanced items accounting so first month of the fiscal year is oftentimes so this is the first month not the last month so the fiscal year is is like your business year oftentimes that's the same as the calendar year meaning January to December but if it's not then you want to make sure to change this and as you do make sure that you're talking about the first year this is important because when you run your reports quick books defaults that it's going to run reports for a year and it rolls over the the closing process based on your fiscal year so if your fiscal year is wrong it's gonna it's good the whole closing process thing is going to get messed up so if you have a calendar year it's right by default January is the first month of the year but if you've got some other year then make sure that you're you're accounting for that first month first month of income tax year same as the fiscal year we're going to say if it was different maybe you have a fiscal year that's different and then you have your tax year which is January ask your accountant about that if that's the case accounting method I highly highly recommend keeping that on accrual unless you have some some reason to do otherwise because when you're thinking about the accounting method you can't just choose to be in a cash-based method by just toggling this thing over what really happens is you're on a cash-based method this is a flow chart whether or not you're using forms that are accrual based or cash-based so for the customer cycle for example if you just enter a deposit form and record the sales when you get the deposit you are on a cash-based system even though you have the capacity to enter accrual transactions if you're using a create sales receipts form that's like the form used at a cash register you are on a cash-based system even if you've toggled over to the accrual thing it's only if you enter invoices that you've now switched over to kind of an accrual system so the fact that you're using invoices means that you're doing something in an accrual system if you toggle over to a cashed based system and try to use an invoice then you would think the systems not gonna not gonna actually record the revenue until you receive the payment which isn't typically what you would want to have happened you would want it to record it if you're using an invoice when you record the invoice so so if you're thinking about toggling that over or switching this to cash you probably want to make sure that you're clearing that with an accountant or CPA as to why you would be doing that by default I would suggest accrual so close the books now at the at the end of a of a period you could you could close the books here and this could be a useful thing to do because a common very common problem with QuickBooks is the idea is the capacity for people to change data say in a prior year and what happens then is that your your current data is messed up because you end up with these timing differences that happen so for example if you if you if the year ended in 2022 you finalized your your financial statements because you did your tax return based on the QuickBooks data and then you go back into the prior year and delete a bunch of stuff like checks and whatnot that didn't clear it might it might be right that the checks were wrong and you need to delete them to move forward but you're messing up the prior year's income statement which has already closed out and that means that you're gonna that that's your retained earnings or whatever wouldn't roll over so to really fix that you would have to you would have to do an amended tax return or something if you fix so you don't want to do that what you want to do is have those adjustments happen in the current period so you've got to be very careful deleting stuff in the prior period one way you can stop yourself and someone else from doing that is to say okay we closed out the year I filed the tax return I'm closing out the prior year and you only be able to change things after you see a warning or enter a password in an attempt to hopefully only allow people that know what they're doing or have thought it through to change anything in the prior period okay so I'm gonna toggle that off as the default for now out by default QuickBooks is quite flexible with deleting stuff so company type this is I'm gonna say yes here and so you got the sole proprietorship partnership small corporation we chose this when we set up the company file there's not a big difference in terms of the GL accounts when you choose these these these different options here so but we're gonna keep it on so we'll talk more about the accounting related to it in terms of what happens with the equity section accounts and so on when we go through the practice problem but we're just gonna keep it on the sole proprietor for our practice problem so we got the chart of accounts enable account numbers now account numbers can be great but people often mess them up because they don't know how to add account numbers in a way that makes sense so they get all tied up with account numbers so so by default they turn the account numbers off which is what we're gonna do here I think we're gonna have a section that just shows you the general items of account numbers we possibly have that or a course on that so if you want to learn the account numbers you can but by default we're gonna be putting them off here and the thing with account numbers they give you a little bit more control about the orderings of your accounts and the and less flipping of accounts changing the order year over year because it's gonna in what not because as the as you add accounts and whatnot so so but if you don't add the account numbers properly the account numbers will actually be not making sense they'll be out of order in essence because the the chart of accounts is first in order by account type balance sheet accounts then income statement accounts the account numbers need to line up with that and that's how they have to be added so we'll talk more I think we have a section on that and says tips tips account and then billable expense account so this account that that goes with the settings expense bills expense track billable expenses and items as income in a single account so we're gonna keep that off by the default here so I'm gonna keep that okay next one we're gonna say categories and just let me just recap this again if you that tips we saw setting before this is the account that goes with the setting sales form contacts if you set that up then you need the account that's gonna basically be set up with it here and that's what they're basically saying alright let's go to the categories we got the classes now the craft classes and location tracking are another field similar to the tags that allow you an added level of tracking particularly on the income statement so if I wanted to track items on the income statement by location or by department or something like that then I can turn on one of the act in a similar fashion they have some differences but they act similar and then I can print my income statement out and break it out columns by location and by class and then have a total column so it's really a neat tool but only applicable in certain in certain situations so if you have different departments you can actually use it if you have both your business and your personal stuff that you're tracking in QuickBooks which isn't normally recommended but it's possible to do with the class tracking to break that out especially if you just have a schedule see our sole proprietorship we have courses on that if you want to check that out but we're gonna keep that off for the default note that if you're adding levels of information by like location or department then you've got a whole lot of options you want to think about though what one is that you can have sub accounts by location or department or two you can turn on class tracking or location tracking which is going to give you another column on the income statement by location or department or or you can use the tags which is another way that you can add some some level of tracking information so so you want to kind of think about those that there's a lot of different variant uses that you can use those for and the options that they have are getting you can also the same with the projects or a job cost system you can use projects to do some so there's some various ways to to do the same thing these times which is great but can also lead to paralysis of too many different ways to do something so you want to make sure you pick one so automation pre-fill forms with previously entered content so automatically fills other fields of the form based on the last save transaction for the customer vendor or employee that helps us to enter data and then in the following timeframe enter it more easily as it picks up the transactions similar to what we did in the past so that is a great tool we'll keep that on by default automatically apply credits automatically applies credits to the next invoice you create for for the same customer so if they have any like if you have credits meaning outstanding amounts they that need to apply lowering their bill that are outstanding for a customer it'll apply those out automatically most companies turn on this setting turn it off if you if your property management so we'll keep that on by default property management might have a credit that's outstanding all the time and then they have a security deposit so if you've got a security deposit that you're recording that you don't want to apply to the invoice of course because you're gonna have to keep it outstanding then you'll have but any other company usually when you have a credit and outstanding balance the next invoice that you create you're gonna lower their bill by the outstanding credit is the general idea so that's on by default we'll keep that on automatically invoice unbilled activity so automatically creates invoice for customers with unbilled activities I won't do that because I want to actually create the bill so if I had an expense that I entered an a bill a customer into an expense or a timesheet that I I don't want to automatically create the invoice I would like to do that periodically and go through the invoicing process that's my general thought on that automatically apply bill payments when you add bill payments in the register the setting automatically applies the payments to the oldest existing bill which kind of makes sense by default if you were to use that so I'm gonna keep that on by default projects this is another kind of specialty area which might be used kind of like in a job cost system or tracking particular projects another great tool we might have I think we might have courses in and of that on its own but tracking projects is kind of a specialty area in like a job cost system system in general is kind of a specialty area in and of itself so we're not gonna have our major focus in on projects with the practice problem but like I say there's some overlap between tracking projects tracking jobs and tracking tracking class tracking location tracking using tags you know which of those are you gonna use for whatever specific need that you're trying to fulfill you want to think through that if you have any specific need currency so we're gonna be using the United States dollar now note that the general accounting will be similar if you're in other other countries to use like your your your home currency will be like your your default currency it gets a little complicated when you're dealing with transactions in multiple currencies meaning you have a home currency and then you have transactions in other currencies because then you've got this exchange kind of issue so you would only turn on multiple currencies lets you track transactions in foreign currencies use it only if you have bank account customers or vendors that don't use your home currency so note what you can do here you can set your home currency to whatever home currency is applicable and that's fine but if you have transactions in multiple currencies then that's when you have to turn this on and I don't think you can turn it back off once you turn it on although it just adds some fields a little a little gets things a little bit more messy but not too big of an issue but we I think we have a whole course on that if you want to dive into into that as well but it's a kind of a specialty area too so business network allow members to find me so it says when a member searches for your company they'll see your website and company city so on only members request to accept to see your company email so I'm gonna turn that off by default because it's a practice problem your company won't be shown in the business network but any member you request to connect with can still see so I'm gonna say okay that's fine and then other platforms or other preferences date format so I'm gonna keep the default which is which is the month day year but you depending on your location there's different preferences for the date some sometimes when you're saving stuff it actually is makes more sense to say the year the month than the date because you want to save it you know by year month and then date typically maybe but I'm gonna keep the default number format this is the United States typical month number format but you might have different number formats depending on your location worn if duplicate check number is used that's a standard internal control I'll keep that on warn me if I enter a build number that's already there you could turn that on but I'll keep it off by the default warning if duplicate journal numbers is used I'll keep the default there sign me out if inactive for one hour so this is a an internal control over QuickBooks online you are in an online system you're working on a website so that's you know if you're if you're leaving the workstation for some time you would think that you might want the station to turn off after some point the default is an hour you can set and adjust that if you so choose so those are those general settings I don't think we've done anything going anywhere unusual in terms of the the the business view versus the accountant view so we've just been under the cog here and we went to the plus button which are basically the same under the business and accountant view