 QuickBooks Desktop 2023. Enter transaction purchasing equipment using bank feeds. Let's do it within two weeks. QuickBooks Desktop 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 QuickBooks Desktop Bank Feed practice file we started up in a prior presentation going through the setup process we do every time maximize the home page to the gray area in the view drop down we got the hide icon bar open windows list checked off open windows open on the left we're going to open up the major financial statement reports in the reports drop down going down to the company and financial starting out with the profit and loss otherwise known as the income statement. I'm going to change the range to the area where my bank feeds are located for the year 010122 to 1231 222 and then customize the report so I can go to the fonts and numbers change the font up let's bring it to 14. Okay yes and okay then the other major one reports drop down company financial the balance sheet the balance sheet standard there's only one date range here so one date I'm going to go up to the customized reports so I can see the range so that when I drill down using the zoom feature I will have a range then 010122 to 1231 222 and then the fonts the numbers need to be changed up let's say to 14 okay yes and okay there's the balance sheet the income statement we're now going to be imagining we're using the bank feeds in order to record the purchase of property plant and equipment now just a quick recap if I go to the home page over here that well let me open up the bank feeds first if I go to the banking drop down bank feeds here's the bank feed center which would only be there if you have bank feeds set up which we did in a prior presentation maximizing this for some reason and unmaximizing it I don't know why it does that but I'll re maximize it and then we've got our data down below I'm going to go into the unrecognized transactions now once again if I go to the home page then I'm really looking at transactions remember when you're entering the information into the bank feeds you're still going to be in essence using forms where applicable meaning QuickBooks will default to a form we've in essence are looking at those things that are going to be decreasing the checking account which QuickBooks will usually use the form of a check form the check form not only being for those things that have an actual check with a check number in a written check but the form used for electronic transfers and so on that decreased the checking account the other side going to some other place normally when you enter a check like we did last time we're entering checks for expenses so the different types of things we pay for oftentimes will be expenses but if we purchase something that's very large we've got to be careful because we might have to put it on the books as an asset now note that if you're a small company then you might say hey look I'm going to try to make everything on a cashed basis and I'm going to try to base everything from the bank statements to create my financial statements I don't want to do an accrual thing which when we look at property planning equipment is an accrual thing but note that the property planning equipment the fixed assets are one area where you can't get away from doing some accrual components so in other words just to see what's going to happen here if I go to the balance sheet we're going to decrease the checking account the other side instead of going to the income statement profit and loss like we did last time is going to go to the balance sheet in an asset area called fixed assets which could also be known as property plants and equipment pp and e depreciable assets you have to do that for taxes if nothing else because the tax code is going to make you do that when you make large purchases so then the question is well how can I set up my bank feeds to account for these large purchases one way you might do it is you might try to set up like a dollar restriction and say hey look if I purchase something that's greater than a certain dollar amount you might want to make a rule to put that to another account or at least check it a little bit differently so that you can pick up those those fixed asset items give them to the accountant possibly at the end of the year and help them help you to calculate the depreciation related to it so the general accounting would be we're going to put it on the books as an asset and then we're going to expense it over the time period that we use it in accordance with an accrual concept of and using accumulated depreciation and depreciation expense so if I go to the list drop down into our chart of accounts if you had a chart of accounts set up by choosing an industry they might give you a couple like property planting equipment accounts but I would be very careful in first setting up your property planting equipment accounts because again the sub ledger will not be done typically within QuickBooks as so much as outside of QuickBooks usually in tax software meaning the actual backup of your equipment the list of equipment that you have and the depreciation per piece will typically be done on the tax software because you're going to have to do it on a tax basis anyways and then you can also use the software to convert it to a book basis if you want therefore you want to consult your accountant your tax preparer or your software if you're doing your own taxes to try to tie together the accounts that you're setting up within QuickBooks to the same grouping that will be on the tax software and the depreciation schedules related to it keeping that in mind we're then going to go then to the bank feeds and we'll set up the the account as we go i'm going to sort it by the downloads i'm going to look for an item i can use here let's just use one of these items and so i'll use this one and pretend this is the purchase of our equipment so it'll be much the same it's still a decrease as we saw with the utilities in that we're still going to have someone that we are paying that will usually be in like the memo so i'm just going to type in s sary s r e g i s i'm going to say tab it's going to ask me if i want to set that up i'm going to do a quick setup because it is a vendor once again so i'm going to do a quick setup it will be a vendor i'm going to say okay and then in the accounts if i don't have an account set up already i could set up the account here by adding a new account or just typing the account in this time i'll just say new account and then i'm going to call it the i'm going to call the account let's just call it equipment i'm going to imagine that we're purchasing equipment and then i'm not going to put a description a note i don't need to assign a tax account and so i'm going to just keep it like that but the key point here that i almost skipped is that it shouldn't be an expense account which is the default account for a decrease it should be an asset account so it should be a fixed asset type of account going on the books as an asset so notice that you got to make sure to pick that up or else you're going to assign it to the wrong account so then i'm going to say okay if i look at my chart of accounts now just to see what happened lists chart of accounts now we've got our equipment up here as the fixed asset account now if you set it up wrong you could change it by right clicking and edit the account and then change the account you got to be careful but to do that but normally you know it's not going to throw you out of balance or anything because the quick books will kind of still force you to be in balance but it is a little tricky going from an expense account and try to change the whole thing up to a fixed asset so you want to make sure you catch that kind of thing early and then we're going to go back on over to that's why you check every time you enter a transaction check the financial statements to see that it does what you expected to do and so then i'm going to hit the drop down here and go to add more details because we're going to make a rule and also see the data input in this format so if i look at it this way uncategorize date there's the item date up top the memo there's the payee that we set up equipment is the account that we set it up to go to also just realize that when you're dealing with this information you're going to have to give it to the tax preparer for them to calculate the tax depreciation and possibly the book depreciation so you're going to want to put in your memo when you're tracking this stuff what you purchased and you want to be as descriptive as possible so if you purchase like three tractors or something like that you know or you know three forklifts or whatever you're going to want to make sure that you can distinguish the three different forklifts uh in your in your memo so that when they put it on the tax records on the subledger they don't just put it on there as one lump sum for three forklifts instead putting it on there as three separate forklifts because if they put it on there as one lump sum then if you sell a forklift in the future it's going to be a problem because you're not going to be able to identify which one you sold on the subledger and you'll have to break it out to try to to try to account for the subledger so it will not be a problem at the beginning it will cause a problem later so you want to track what you're purchasing in detail make sure your accountant is preparing your depreciation schedules in detail listing exactly what you purchased so that in the future when you sell stuff and dispose of things it'll go smoothly all right so then we're going to go down and add a rule so we're going to add a rule i'm going to pull this to the right and the rule is going to be once again i'll just call it uh s i'm going to stop saying once again if that's bugging you it's bugging me i'm saying stop saying once again okay okay i'm going to stop it's a money out rule we're going to say this time we could say all or any so this time i'm going to keep it at all and we'll talk more about like this kind of rule if you have property planting equipment that might be over a certain dollar amount later but just to give an idea of it note that the person that we buy equipment from might be the same people we buy supplies from like like an office supply store or something like that an office depot so you might say okay if i buy something that's below a certain dollar amount i want the rule to be applying it to supplies expense but if i have an item over a certain dollar amount then i might want you to apply to fixed assets so you might say add another rule in this case and you might say if the amount is over greater than whatever five thousand and what would that dollar amount be is there some kind of set rule no there's not but general the general idea would be that if something is relatively low in dollar amount then then it's going to be in material to then put it on the books as a fixed asset you might as well just expense it why because that's the easiest thing to do if it's over a certain dollar amount whatever dollar amount you think material or relevant to you then you're going to use that dollar amount and then it'll at least give you an idea that this thing is more likely that it should be on the books as an asset and depreciated which is the more complex thing to do the thing that needs to be done when you have a larger material item just from a practical standpoint so we'll talk more about that later i won't do that right now i'm just gonna keep the singular rule as we've been working on but apply it to an equipment account as opposed to an expense account so this looks good and then that looks good so i'm going to save it and then let's go ahead and here we've got this looks good so let's save it and add to the register so now it pulls it over here so if i go to the added to the register items notice last time i logged out so when i go back in here this is the only one i have it doesn't save all the items that you added to the register it's only in this current session that it adds them and then in the recognized area it pulled these other items into the recognized area here for the equipment i'm not sure i'm going to keep that there because we just kind of made it up but if this was a reoccurring transaction that could be quite useful because now it can save those and i can just add them quite quickly let's see what happens to the balance sheet shall we shall we people balance sheet checking account double clicking the checking account we now see that we have the this amount going down for this check form if i double click on it it takes me once again to the i'm going to stop saying that it takes us to the check form as we have seen in the past and it's going to decrease the checking account the other side going to the expense closing this out closing this out and then the other side is in net income looking at it from the balance sheet perspective breaking out the income or equity section in the profit and loss i'm sorry it's not in net income that would be if it was an expense get with the program we put it into the equipment which is now under the category of fixed assets if i double clip on the equipment there it is double clicking on that there it is the check so that's the difference here it didn't go into income when will it hit the income statement when we depreciate it allocating the expense to income when we consume the equipment would be the theory in accordance with the matching principle a cruel kind of concept how would we do that how often would we do that possibly monthly if your small company possibly yearly how would you do the calculation most likely with the sub ledger which would be done by the tax software often done by a tax preparer what kind of depreciation would you use you might if you're a small company use simply tax depreciation even though it's not the best for books purposes but then you only have one set of depreciation schedules or you might tell your accountant to to also calculate the tax depreciation and book depreciation so you can use whatever you want straight line double declining whatever you think would be best for uh book purposes how often do what are you how are you going to work with the tax preparer well because you don't purchase equipment all the time you whatever was purchased in the past the tax software will already have any new purchases you're going to have to give to the accountant possibly with just a sub ledger like this because these are big purchases you shouldn't have a lot of them but you want to make sure that you're giving all the detail to the tax preparer about those purchases and disposals so that they can keep a good accurate sub ledger that that can tie out to the actual equipment that you have so that when you sell them you don't have to break up multiple items on the sub ledger and so on okay closing that back out we also see that in the vendors section vendor drop down vendor center we've now added another vendor so we want to make sure that we are adding vendors because that gives us that other level of searchability if i have questions about who i paid and so on i might want to look at it by vendor as we have here okay so now also i'm just going to open up the trial balance counting taxes trial balance i think this is an under utilized report but quite useful so i want to just check it out from time to time oh one uh two two that's what am i doing oh one oh one two two to twelve thirty one two two and then i'll customize it and go to the fonts and numbers changing the font let's bring this up to 16 so we can see it clearly okay yes okay this gives you the balance sheet and income statement accounts for a particular year in one area so that's really nice to be able to do the data input and then jump over and see what happened drilling down on this one report as opposed to jumping back and forth to a longer and more complex financial statements of profit and loss and the balance sheet also just note that there's another report just want to check in on if you go to the accounting and taxes and look at the transaction list by date report and we go from oh one oh one two two to twelve thirty one two two this gives you a list of transactions that we've entered thus far if you want to see them in journal entry format you can go to the reports drop down accounting taxes and the journal and i'm going to say okay from oh one oh one two two to twelve thirty one two two now these two reports are quite good to check how much work you have done and act as a supervisor to someone else in what they have done and also you might bill based on these reports looking at the transactions or looking at the transactions including the complexity how many accounts were affected for example to determine your billing range for bookkeeping services as well