 QuickBooks Online 2022 write checks for expenses and prepaid assets. Get ready because it's go time with QuickBooks Online 2022. Here we are in our get great guitars practice file we set up with a 30-day free trial holding down control scrolling up just a bit to get to that one to five percent currently in the home page otherwise known as the get things done page in the business view as opposed to the accounting view if you wanted to go to the accounting view it's something you can do by going to the cog up top and then switching to the accounting view we will be toggling back and forth either here or by jumping over to the sample file to look at the accounting view and compare the two views back on over to the get great guitars we're going to open a few tabs up top by going to the tab right clicking on it duplicating it going to repeat that process two more times to put reports into these tabs back to the left right clicking again and duplicating again back to the tab to the left right clicking again and duplicating another time as that is thinking we're going to jump on over to the sample company to note where the reports are located in the accounting view which is just on the reports tab on the left hand side if we go back to the business view we're in the second tab the reports are located in the business overview area and then in the reports we're going to open up our favorite three reports are going to be starting off with a balance sheet report let's close up the hamburger scroll up top and do the range change from 0101 222 1231 222 and run it and then go to the tab to the right and go to the reports on the business overview and then the reports again this time the income statement the P and L the profit and loss closing the hamburger range change from 0101 222 1231 222 and run it and then we'll go to the tab to the right one more time business overview and let's take a look at the reports and this time open up the trial balance trial balance really important super good report trial balance you should use it closing up the hamburger range change from 0101 222 1231 222 and run it so there we have it let's go back then to the the let's look at the balance sheet tab I'm going to hold down control scroll up just a bit we're now going to enter transactions which would be kind of normal bill or expense type of transactions we might have at the end of the month things like the utility bill things like the telephone bill paying insurance and so on and so forth now note as we make our monthly payments and we enter these transactions you could do so on an accrual basis or you might do so just paying the transactions as they become due so in other words if I would jump back on over to my flow chart which is the desktop version flow chart but it still has a nice flow chart so bear with me if we're up here and we're going to be paying off then bills when we receive the bill say a utility bill say it's a paper bill or by email or something like that the term bill you'll recall is different when used in normal language then when we're talking about the bill form the bill form specifically means that we're going to enter something that will increase accounts payable however the bill thing the piece of paper that we got we could then pay by either entering a bill form or by entering a check or by entering an expense type of form in other words if I get the paper bill I can take the bill that we got from the utility company and pay it off with a check never entering a bill form into the accounting system but rather just entering a check or an expense form or I can enter a bill which would increase the accounts payable and then sort it and pay it later with a pay bill type of form which is another format of a check here we're going to first start off with more of a cash basis system imagining we're getting the bills and we're simply going to pay them not entering them into the system as a bill not going through accounts payable but rather just paying them as they become due in the second half of the course we will enter them or in the second month that we go through we will then enter them as a bill and do more of an accrual basis system also notes that if you have the bank feeds turned on then these are going to be some of the easiest transactions with bank feeds if you were to pay them with electronic payments in other words if you're just paying electronically your utility bill and so on it's coming out of your checking account then those are things that will typically if electronically made are fairly easy to then assign out to the proper expense account and do that on a kind of automatic type of basis larger businesses of course will typically enter the bills because they're then going to want to sort the bills and try to hold on to the money as long as possible that cash management strategy being more and more important as transactions increase in terms of the number of transactions in place okay that said we're going to go back on over here we're going to start off with a transaction we're imagining for insurance insurance is going to be something that is the classic example of a prepaid expense a prepaid expense is one in which we're paying for it before we get any work done which is different than most of the time when we pay for something for example when we pay for the telephone utilities the gas electric we get the we get the use and then they charge us for what we used with insurance we pay for it before we get the use the use that we get is coverage even if we don't actually claim an insurance claim even if we don't have an accident or something like that where we're claiming insurance we get coverage in the future so that's a little bit different and it would lead us to then say well if that's the case and I prepay it should I record the expense at the point in time I pay it and if you just pay it month by month then maybe you could still record it at the point in time you pay it however oftentimes you pay for six months to a year and then you you might want to use an accrual concept that accrual concept by the way is the same kind of concept as is with the fixed assets like building and like equipment in other words if you were to purchase something like a building then you would put it on the books as an asset because you know that even if you paid cash for it you're going to be using that building for multiple periods in the future and if you expense it it's not really proper or doesn't help with comparisons from year to year or month to month because you purchased it for a long term investment the accrual concept of putting it on the books as an asset allocating the cost over the useful life is an attempt to have the proper matching so you can actually judge performance on a better kind of mandate or better method now even if you were on a cash basis the tax code would still force you to do an accrual basis concept in that instance the same kind of concept is true with basically the other prepaid assets like insurance but to a lesser degree so you if you're on a cash basis you might say hey I'm just going to expense my my prepaid insurance you might be fine to do that but if you if you prepaid the insurance and you pay for a whole year's worth of insurance in January and then you try to compare January to February you're going to have this this kind of distortion because February used the insurance that was paid in January so you got that problem with the comparison problem okay so the general idea from an accrual standpoint would be that we're going to put it on the books as an asset and then adjust for the expense that has been incurred on a periodic basis at the end of the month or the year we'll talk more about that in the adjusting entries so let's go back to the first tab I'm going to hold down control scroll down just a bit we're going to go then to the plus button and we're going to use the check form note that you can also use the expense form here if they were electronic transfers but I'm going to use the check form and have the check number that will be in place that we'll see when we do the bank reconciliations and see how that all works out so this one I'm going to add the vendors as we go I'm going to call the first one safe insurance company that's generic name for our insurance company safe insurance company we're going to call it tab and then it's going to be a new vendor and I wish it would default to the vendor when I'm in a check but it's going to be a vendor and then we're going to save that and then it's going to come out of the checking account which we just labeled as cash so that is what we want let's put the date here happening this is going to happen on let's say the 26 that we're going to say this 1007 is the check number so that looks good we'll keep that and then we're not going to buy an item down here so I'm not going to add an inventory item this time we're just paying for an expense just need to assign the expense account this adding of accounts is one of the major differences at this point in time between the business view and the accounting view the business view being more restrictive trying to give an interview type of process I believe trying to kind of restrict errors as you do the data input although it's more restrictive so if I hit the drop down we've got these couple categories I can still type in here and it'll give me suggestions but I can't really add the account in the same way if I had to if I wanted to add a new account as we go as easily I can go to the C categories on the bottom then go to the categories and I can add this way but it's a little bit longer of a process I'm going to then go back to the accounting view and take a look at it in the accounting view by right clicking on the tab up top and duplicating it I'm going to toggle to the accounting view in this new tab so we can see the differences between the accounting view and the business view here and I'm going to close this one back out I think the accounting view is the more traditional view but this is the kind of thing QuickBooks will do they'll try to A, B test and see which of these data input kind of features is going to be easiest and so I'm going to go back on over and which people prefer let's change this to the accounting view now so now you got the layout on the left hand side with our tabs and then I'm going to go to the plus button up top and let's go to the check form and let's do it again and enter this on the accounting view style so now I'm going to say this is safe insurance tabbing through it I'm going to say this happened on the 26th and check number okay and then down here now if I hit the drop down it gives me my categories which I can scroll through which is something I very much prefer other than the pop up on the right hand side and you can then type in prepaid now prepaid insurance is not going to be there prepaid they do have a prepaid expense account but I want to put into prepaid insurance I could either adjust this account to prepaid insurance but I'm going to type in prepaid insurance insurance tab and then allows me to basically make this account as we go which is what I would prefer and then I'm going to hit my drop down and I'm going to choose the account category which is not going to be an expense account but another current asset to count it's not going to be allowance for bad debt but it's going to be a prepaid account so it's going to be prepaid expense and I'll call it prepaid insurance I could make it a sub account of the prepaid expense account but I'm just going to keep it as a standalone prepaid insurance save it and close it and then we're going to say the amount is for 12,000 that we're going to say it's not going to be billable or taxable this is going to decrease the checking account the other side going into an asset account let's save it and close it save it and close it jump on over let's jump to the trial balance and take a look at it pretty straightforward transaction well let's look at it on the balance sheet because they're this is both balance sheet accounts let's let's run this sorry about that let's run it and freshen it up jump on into the cash here and we can see then in the cash we've got then the check there's the 12,000 check going back on up top back to our report summary the other side zooming in is in an other current asset account here and we're going to apply it out then to an expense and an adjusting entry process at the end of the year or at the end of the month okay let's do another one I'm going to do another one here and again I'm going to stick with the accounting view on this one because I think that that entering the expense accounts is way easier in my opinion so I'm going to hit the drop down up top or in the accounting view I'm going to go into the check again and this time we're going to assume we're purchasing now this form looks the same under the two views it's just when you add the new account down here that they're experimenting with a different look and feel so this is going to be staples that's who we're going to be purchasing from we are imagining I'm going to add a new one a new item for staples and so we're going to say I'm going to say it's going to be a vendor it's got to be a vendor save it tabbing through on the 26 that looks good and then this is going to go to office supplies so this is where I'm going to try to see if they have an account set up already and you can do they'll do so by typing in here I can say supplies to they have a supplies account they have an expense accounts called supplies here it is an expense you can see on the right exp supplies is another area where you could put it on the books as an asset and then kind of track it similarly as you would with inventory and you might do that if it was like medical supplies or something like that that was expensive however if they're small office supplies like staples and whatnot it the easiest thing to do would simply to be expense them at the point of purchase and that's what we will do here and I'm going to say the amount is going to be for $500 and so let's save and close that decrease in the checking account other sides going to go on the income statement so we're going to check it out let's go to the balance sheet let's run it and we're going to zoom into the checking account and then go on into it looking at the checking account zoom in back out and we can see that there's our check $500 going back on over to the balance sheet zooming back in the other side is going to be on the income statement let's go to the income statement let's make it a fresh report freshening up the report and then we have our expense account there's our supplies there's the $500 on the income statement side of things next let's do another one we're going to pay the utility bill and again i'm going to go back into the accounting view to do it and so i'm going to go to the plus button and we're going to add a check let's add another check and this is going to i'm going to say this is for Edison that's who we pay for our utilities for our energy electricity drop down and vendor and we're going to say save that it's going to come out of the checking account so that's good notice all we need is here just the name that's the bare minimum you need i don't need to add all the other detail for like paying the utility bill typically because i'm just trying to pay the bill if it's a major vendor like who we purchased our inventory from then most likely we want more detail in terms of who the vendor is their contact information and so on now the utilities this is something you might type in you might want to put it under electric for example electricity which they have as a subcategory of the utilities or you might just want to put it into utilities the utilities account itself and that's kind of up to you as the as the business owner if the electricity was a substantial part of your business you might want to track it separately however these days it used to be that the telephone electricity and the gas were kind of combined together in one account utilities and it's often the case that the telephone has now broken out because it's so you know it's important in and of itself and then gas and electric are often still categorized grouped together in utilities but that's going to be a personal choice however that's what i'm going to do here i'm just going to put it into the utilities account directly so it's a choice between more detail that would be good to have the more detail to track versus the more complexity and confusion that tracking that more detail is or provides and at a time of having more detailed accounts so in other words the easiest kind of way you can do your expenses is just to have one account called expenses but that wouldn't give you any any breakout of the detail and then some people go way overboard on the other side breaking out way too much detail of accounts that are pretty much in material and don't have any real impact on decision-making okay so now this is going to be for 620 and so we'll save and close that and check it out let's go back to the balance sheet and we can drill down on the cash account again going into the cash account and then zooming out zoom out panorama view there's the 620 there going back to the balance sheet zooming back in zooming back in going to the profit and loss and refreshing that report freshened and then we see that we have the utilities at the 620 all right let's do another one let's do the telephone expense let's try to do that the business view at this one on this one i'm going to go back to the business view do you want to leave without saving i'm going to say yes i had that one open before so now i'm in the business view you can see over here if you want to practice that you're in the accounting view you can toggle back and forth with the cog here and let's check out let's hit the drop down and say i want to enter a check again a check again in the business view just to mix things up a bit and this is going to be for Verizon that's our telephone company we're going to add them as a vendor which should pop up as a default i think they could they could make that happen over there in the quickbooks area and then this is going to be 26 and then down here i'm going to look for now the telephone so i don't get this nice drop down it has the more accounts here i can type in telephone telephone and see if it picks it up telephone and it doesn't i can i can go to the C more categories on the right and go into the expense category this way and i can say okay i i would think you would have a telephone possibly under the utilities they just called it phone and service so phone and service and notice it's under the utilities so possibly i want to call it telephone maybe and have it outside of the utilities and then have utilities picking up the electric and and the gas maybe so if i if that were the case let's first put it in place i'm going to i'm going to pick up the phone and service and say let's say save that and then i'm going to tab on over and say this is going to be 410 and then save it and close it and check it out so let's go on let's go to my balance sheet and freshen it up let's freshen it up go into the checking account and of course we should have that recorded properly so there it is that looks good going back up to my reports and then go into my income statement freshening that up and then down below you can see here you got this subcategory of the phone and so maybe you don't maybe i don't want that i would just like my telephone to be broken out separately i don't like that subcategory thing so if that's the case i can say okay well let's go to like let's make another tab right click duplicate the tab and this is this is something i would probably do in the accounting view actually i'm going to go i'm going to go to the second tab and do it in the accounting view whenever i'm adjusting the general ledger because i think they're the business view has some restrictions so i'm going to hit the drop down or at least it's a little bit more difficult to navigate so you can switch to the accounting view if you're in the business view and you can see it's in the accounting view by the tabs on the left hand side looking like this and then i'm going to go to accounting it down below which in the business view would be under bookkeeping and i want to go into my chart of accounts and scroll down to that telephone account down here and i'm going to say you know that telephone account i'd rather name it something different and take it out of that subaccount so i'm going to go all the way down to the telephone where it is under utilities so this one i'm going to edit this one i'm going to down and edit and i'm just going to call it telephone telephone and then i'm going to take it out of the subaccount of utilities and that won't change i've already posted to it so it's not going to change it's not going to delete what i posted to it it's just going to change where it's located as an expense so i'm going to save it and close it and then if i go back to my income statement i can say let's check that out let's run it and if i scroll back down so now i've got my utilities here and i've got my telephone now if i like that and then i can i can delete some of those other subcategories under the utilities once i enter a few months of data input i could go back to this chart of accounts and if i'm not using some of these they put a whole lot of accounts in here if i'm not using some of them i could just you know remove the ones that i'm not i'm not putting in place here or at least make them inactive as we go forward so now if you want to take if you want to track this activity if i went back to the first tab i'm now in the business view you can go you can go into the bookkeeping area and you can go into now the expenses tab and i could track this information filtering it so i could go to the filter for example and i can take a look at my check type of transactions and then filter by the checks and apply that out and i can see my checks there i can also see them by hitting the the item on the on the left notice that that transaction tab if you're in the accounting view would be under that transaction in the accounting view would be under the expenses area where you'd have the expenses tab here and then you've got the vendor tab here in the accounting view and if you're in the business view you would be under the get paid and paid area and then the vendor tab down below and you can check out your activity by vendor for example going into verizon and seeing our bill there okay let's go to the trial balance this is where we stand at this point in time and so you could check out if you've been following along let's make sure it's fresh if you've been following along and your numbers tie out great if not then try changing the date range sometimes it's a date range thing and and then we'll be taking a look at the transaction detail report at the end of the section which is often something that could help us determine what the differences are due to