 QuickBooks Online 2023, Rental Income, Invoice, Receive Payment, and Make Deposit. 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 using 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. Support Accounting Instruction by clicking the link below, giving you a free 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. Or another browser. You can open Incognito Window if using Google Chrome by selecting the three dots in the browser. Incognito Window, type into the search engine, QuickBooks Online, Test Drive. We're going to look at the sample company to compare the accounting view, the view Get Great Guitars is in, and the business view, the one the sample company is in. If you want to change between the two, hit the cog up top, switch the view down below. We're going to open up a couple tabs like we do every time to put reports in. Right-click in the tab up top to duplicate it. And then we're going to right-click the duplicated tab to duplicate it. And then we're going to go back to the tab to the middle. The reports on the left open up one of the favorite reports, the financial statement reports, the balance sheet report needs no introduction because it's famous. And then just note on the business view, by the way, the reports are in the business overview and then the reports on the left-hand side. So then let's go to the tab to the right and open up another report. The other famous report, equally famous, they're good friends. They're not like rivals or anything for fame. They're not like all egotistical like that. They hang out. Any case, we're going to close up the hand boogie up top and change the range. It's going to go from 010123 to 022823. And then we'll say from totals to months and run it. So I can see Jan, I can see Feb, I can see Jan and Feb in the tote. And tab to the left, close up the hand boogie, change that range. You change that range. 010123 to 022823. Run it. That's the setup process that we do every time. And prior presentations or in the last presentation, we've been talking about our rental process here. Remembering that we're in basically a revenue kind of situation. Many times you can have different revenue situations depending on the industry you're in. You might just getting paid from YouTube. You just make the deposit recorded as revenue. You might have a cash register situation. You create the sales receipt, record the deposit. You might have to invoice people and track the accounts receivable in which case you make the invoice, track the receivable, receive the payment, make the deposit. And then sometimes you might get the money before you do the work. That's what we have in this case. We have a rental system set up for our guitar equipment. Last time we made an estimate. Someone called in, customer number five was their name, which is a funny name. But you know it is what it is. They called in and we gave them an estimate and said, if you want to rent this band equipment, then this is how much it's going to cost. And we want a down payment because we got to hold on to this equipment. People are coming in all the time asking for it. So you got to give us some reason to make sure you're committed. So we asked for a payment. Then we've recorded the received payment before making the invoice because we had not yet done the work, but we can track the payment. Now they're going to come in and we'll continue the story making the invoice, applying the received payment to the invoice. And then of course we can make the deposit. We can hopefully receive the payment again, make the deposit. Okay. So let's go from there. So let's go to the first tab. So last time we made an estimate which has no impact on the financial statements, but which we can track internally. So let's say customer five comes into the shop. They're like, Hey, I made an estimate. I'm here to pick up my equipment and there's someone else at the register and is like, Oh, I don't even, I don't even, I wasn't the one that did that. But let me, let me see if I can pull you up in the system here. And we go into the system and we see in the customer side, we could just click on the estimates. So I'm going to click on the estimates. And I see, Oh yes, customer five does have an open estimate. If you're in the business view, by the way, and they were doing that, you're like, well, I'm in the business view. That would be in the get paid and pay area. And then you can go into the customer section here and there's your estimates. Okay. So then this is probably the way that you could, you would normally do it, but you might also search by estimates here. That's another way that you can do it. Or you might go to your sales tab and then search by your estimates here. These are all ways that you can, you can, all statuses and pending open estimates typically, right? You could do that as well. But most likely most people would say if they came in, I'm going to go to the sales. I'm going to go to the customers and search by customer or I can sort it by estimate, making it a little bit easier to find the customer. You can open that up and then I say, Oh yeah, you've got an estimate outstanding. I can create an invoice with it. And I could have a payment that we want to apply out to it of $200. So let's do that now. So we're going to apply that out. Also just note that we've got this negative kind of receivable of that $200. This, once I complete the process of making the invoice, that $200 will be applied to the invoice and will be everything will be good. Our financial statements will be reported properly. It's a little bit improper right now because that negative $200 should actually be a positive liability. So there's a bit of a timing issue where it's not exactly right, but we can adjust that if we need to at the end of the period with an adjusting entry, if we want to report the financial statements and internally this works really well. So let's go ahead and make the invoice. So I think the easiest way to do that would be just create it from the estimate. And so we'll just make the invoice. There's customer number five. We're going to go through this and say, let's do it on the 72227. I guess we can keep that date. And then we'll keep the number, whatever. And then down here, the items pulled in. There's no income tax related to it because we don't deal with inventory items. The items are the, I mean, the items are the things that drive whether they're sales tax or not. And so this will be a pretty straightforward. So we're going to sell them this band set and then they've got the guitar and added guitar and some added amplifiers. And we can then find this stuff that we hopefully save for them and give them the stuff. And what's this going to do? It's an invoice. It's going to increase the accounts receivable by the 200260. And the other side is going to go to the sales revenue driven by these items, which I believe went into its own revenue account because we told it to on the item, which is rental income of some kind. Also note that I don't, if I gave this to the client, it's not taken into consideration the $200 prepayment. So I'd like to have down here somewhere the fact that they already gave me the 200 not to record a transaction because that transaction has already been recorded. But I'd like to see how much is owed. So there's kind of a two step process to do that. I have to first, I can post this, I can save and close it. I'm not going to give it to the client this way. I'm going to save it and close it. And then if I go back into customer five, notice it kind of did it automatically here where that it made the invoice now partial means partially paid. And the payment, which was unapplied before has now been applied. So if you don't want that to happen automatically, or if you want to change it, you can go back in here and uncheck it. If you don't want that to happen automatically, then you could turn off the settings in the cog up top to switch it. But usually that's a pretty good system. So I can say, okay, now it automatically applied my invoice, the credit to the next invoice that I made. If it didn't, you can go in here and manually do it. And then I can go back into the invoice, which should now be properly represented. This didn't, this didn't record any new transaction by the way of this payment. It was already recorded. The only thing that QuickBooks did for us is link this payment to the invoice. It didn't make another transaction. No added impact happened to the financial statement other than what we already talked about with the invoice. So if I go back into the invoice, now I can give it to the client this way. And they got this little thing down at the bottom, which says, oh yeah, you, you already paid the 200 and I applied that out. So now you owe us 2060. The invoice is still just recording an increase to accounts receivable of the 2002 60 and income of 2002 60. The $200 is just representing the fact that they already paid us an advanced payment that is now being applied out. But it's, but I already recorded that before. It's just here for informational reporting purposes, not to record a new transaction, but I can now provide this to the client if I so choose. So let's see what that looks like on the financial statements. The invoice has been recorded, tab to the right, run it to refresh it in the A to the R, the accounts to the receivable, the A slash R. We've got the, the invoice down here for, for number five. So it went way up here. There's the invoice of 2002 60. And then the payment has already been applied to it, bringing them down to the total that they owe us at this point in time, which we can see here of the, of the 2000 60. So if I go back on up and I go back to the balance sheet, the other side went to the income statement. If I run it to refresh it, run it to refresh it, we've got a new category because we set up our items to go to a new category. And there's the 2002 60 that went into that category for the full amount, not the amount that we're going to get paid this time because we applied the 200 to it, the full amount of the income is how much we earned at this point in time when we actually did the rental process. Okay. So that's all B to the end. Let's go back to the first tab and just complete the process now. So obviously the next step would be that, that hopefully they're going to give us the rest of the payment at some point in time. So they still owe us the 2000 60. So if we're going to get that payment, let's just complete the process. We could go to the receive payment here and that, which would be the next logical step when you're dealing with customer five and you say, okay, you're going to pay me the rest of it. Okay. Let's go into the receive payment and then customer number five. Let's just change the date to the 28th just to switch things up. Let's say it's a cash payment just to keep with our standard process. I'm going to put it into the clearing account of payments to deposit, which is our normal process. But if they gave us a check or an electronic transfer, we could put it into the checking account, but note that if we have a system of always putting stuff through this clearing account, we might want to just stick with that system so that everything is going to be the same and we don't kind of confuse the process going forward. So we'll do that. Then down here, there's the invoice that's being checked off. This is the original amount. This is the amount still due. We're going to get paid for the amount still due. What's this going to do then? It's a receive payment. So this time it's going to do the normal receive payment thing. It's going to decrease the accounts receivable and decrease the sub ledger for customer number five. This time taking the sub ledger, not into negative territory, but simply down to zero like normal. And then the other side is going to go to the cash account payments to deposit cash kind of account, the clearing account, which we will then transfer to the check to the checking account with a deposit form. Save it, close it. If I look at my detail in here dealing with customer number five, everything looks just beautiful. We could just track everything that happened. We've got the estimate. Then we made, we've got this payment to down payment before we made the invoice. That payment is now tied out to the invoice nicely linked together. And then we, and then we made the payment the rest of the payment, which now the invoice is now indicated as paid. So everything, even though it was a little bit wonky in terms of the order, works quite well linking everything together in this method. And now we're looking good. Let's go to the tab to the right and let's run it to refresh it. And then we can say, okay, in the A to the R, we can scroll down a slash R. There's the payment, the rest of the payment. And then the other side is in is in payments to deposit. Boom. Now let's just complete the process, making the deposit, taking it out of payments to deposit and putting it into the checking account. So it's the end of the day. We're going to take that money. We're going to put it into the checking account. So we're going to the tab to the right. We're going to go, okay, let's just hit the plus button and make the deposit. Cash is in the bank and I'm off to the bar with to waste it on stuff. Now I'll do something. I don't know. Maybe I, here we go. Whatever. There's the customer number five checking it off. That's the deposit wheel. We're not tying it out to anything else with it. We're just going to take that one amount. It's going to be increasing the checking account. The other side is going to decrease the clearing account. This isn't serving any added purpose in this case, in terms of batching together multiple deposits. So that shows up in the same format as on the bank statement. But we might still want to use that system all the time. If that's the system that we always use, right? So that we're not trying to record the receipt payment into the checking account directly sometimes and not other times. If we're using one method, it would be nice if we can kind of universalize that method so we don't confuse people as they do the data input. So I'm going to say save and close, tab to the right, refresh the data, check out the checking, check it out. It's the checking. And so then in the checking, we've got the 2060 looks good. And then the other side was a decrease to the payments to deposit, the clearing account, the undeposited funds type account. If you worked with QuickBooks in the past, they like to change the names of stuff. So there that is the deposit has been made. Alright, scrolling back up, I think that's it. Let's go to the tab to the right and right click on it and duplicate it. I'm going to make the trial balance, check our numbers to see where we are at this point, where we stand reports on the left hand side, closing up the boogie, typing in T-R-I-L, trial balance. Changing the ranging from 010123, tab 022823. Let's take a look at the month by month side by side for the Jan and Feb. We're over here on Feb. If your numbers tie out to our numbers, then that's good. If not, try expanding the range. See if it's a date thing, then you can drill down and change the date. If it is a date thing to the correct date, which is a great thing to do in a practice problem, but be careful doing that actually in practice. We'll be doing a transaction detail report after entering the second month of data input to further drill down on any differences.