QuickBooks 2006 For Dummies

409 Pages·2006·10.526 MB·English

by  Stephen L. Nelson

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QuickBooks® 2006
FOR
DUMmIES
‰
by Stephen L.Nelson,CPA,MBA
(finance),MS (taxation)
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QuickBooks®2006 For Dummies®
Published by
Wiley Publishing, Inc.
111 River Street
Hoboken, NJ 07030-5774
Copyright © 2006 by Wiley Publishing, Inc., Indianapolis, Indiana
Published by Wiley Publishing, Inc., Indianapolis, Indiana
Published simultaneously in Canada
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or
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dress are trademarks or registered trademarks of John Wiley & Sons, Inc. and/or its affiliates in the United
States and other countries, and may not be used without written permission. QuickBooks is a trademark
or registered trademark of Intuit Corporation. All other trademarks are the property of their respective
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Library of Congress Control Number: 2005935155
ISBN-13: 978-0-7645-9954-5
ISBN-10: 0-7645-9954-2
Manufactured in the United States of America
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About the Author
Stephen L. Nelson,CPA, MBA (finance), MS (taxation), has a simple purpose
in life: He wants to help you (and people like you) manage your business
finances by using computers. Oh, sure, this personal mandate won’t win him
a Nobel Prize or anything, but it’s his own little contribution to the world.
Steve’s experiences mesh nicely with his special purpose. He’s a CPA in
Redmond, Washington. He’s an adjunct professor of taxation (S corporations
and limited liability companies) at Golden Gate University’s graduate tax
school. And, heck, he even used to work as a senior consultant and CPA with
Arthur Andersen & Co. (er, yeah, that Arthur Andersen — but, hey, it was 20
years ago). Steve, whose books have sold more than 4 million copies in
English and have been translated into 11 other languages, is also the best-
selling author of Quicken 2006 For Dummies(Wiley).
Dedication
To the entrepreneurs and small-business people of the world. You folks
create most of the new jobs.
Author’s Acknowledgments
Hey, reader, lots of folks spent lots of time working on this book to make
QuickBooks easier for you. You should know who these people are. You may
just possibly meet one of them someday at a produce shop, squeezing can-
taloupe, eating grapes, and looking for the perfect peach.
Those folks include my acquisitions editor, Bob Woerner; and my editors,
Virginia Sanders, Andy Hollandbeck, Teresa Artman, Kevin Kirschner, Joey
Carstensen, and David Ringstrom.
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Publisher’s Acknowledgments
We’re proud of this book; please send us your comments through our online registration form
located at www.dummies.com/register/.
Some of the people who helped bring this book to market include the following:
Acquisitions, Editorial, and Composition
Media Development
Project Coordinator: Erin Smith
Project Editor:Kevin Kirschner
Layout and Graphics: Andrea Dahl,
Senior Acquisitions Editor:Bob Woerner Stephanie D. Jumper, Barbara Moore,
Melanee Prendergast, Ron Terry
Copy Editors:Virginia Sanders,
Andy Hollandbeck, Teresa Artman Proofreaders: Joe Niesen, TECHBOOKS
Production Services
Technical Editors:Joey Carstensen,
David Ringstrom Indexer: TECHBOOKS Production Services
Editorial Manager:Kevin Kirschner
Media Development Manager:
Laura Carpenter VanWinkle
Media Development Supervisor:
Richard Graves
Editorial Assistant:Amanda Foxworth
Cartoons:Rich Tennant
(www.the5thwave.com)
Publishing and Editorial for Technology Dummies
Richard Swadley,Vice President and Executive Group Publisher
Andy Cummings,Vice President and Publisher
Mary Bednarek,Executive Acquisitions Director
Mary C. Corder,Editorial Director
Publishing for Consumer Dummies
Diane Graves Steele,Vice President and Publisher
Joyce Pepple,Acquisitions Director
Composition Services
Gerry Fahey,Vice President of Production Services
Debbie Stailey,Director of Composition Services
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Contents at a Glance
Introduction.................................................................1
Part I: Quickly into QuickBooks.....................................9
Chapter 1: QuickBooks: The Heart of Your Business..................................................11
Chapter 2: Answering Mr. Wizard...................................................................................21
Chapter 3: Populating the QuickBooks Lists................................................................37
Part II: Daily Entry Tasks............................................79
Chapter 4: Creating Invoices and Credit Memos..........................................................81
Chapter 5: Reeling In the Dough...................................................................................107
Chapter 6: Paying the Bills............................................................................................133
Chapter 7: Inventory Magic...........................................................................................157
Chapter 8: Keeping Your Checkbook...........................................................................177
Chapter 9: Paying with Plastic......................................................................................195
Part III: Stuff You Do from Time to Time.....................207
Chapter 10: Printing Checks..........................................................................................209
Chapter 11: Payroll.........................................................................................................223
Chapter 12: Building the Perfect Budget.....................................................................235
Chapter 13: Online with QuickBooks...........................................................................243
Part IV: Housekeeping Chores....................................255
Chapter 14: The Balancing Act.....................................................................................257
Chapter 15: Reporting on the State of Affairs.............................................................269
Chapter 16: Job Estimating, Billing, and Tracking......................................................283
Chapter 17: File Management Tips...............................................................................293
Chapter 18: Fixed Assets and Vehicle Lists.................................................................303
Part V: The Part of Tens ............................................315
Chapter 19: (Almost) Ten Tips for Business Owners.................................................317
Chapter 20: Tips for Handling (Almost) Ten Tricky Situations................................321
Chapter 21: (Almost) Ten Secret Business Formulas................................................329
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Part VI: Appendixes..................................................345
Appendix A: Installing Quickbooks in Ten Easy Steps...............................................347
Appendix B: If Numbers Are Your Friends..................................................................351
Appendix C: Sharing QuickBooks Files........................................................................371
Index.......................................................................379
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Table of Contents
Introduction..................................................................1
About QuickBooks...........................................................................................1
About This Book...............................................................................................2
What You Can Safely Ignore............................................................................2
What You Should Not Ignore (Unless You’re a Masochist).........................3
Three Foolish Assumptions............................................................................4
How This Book Is Organized...........................................................................4
Part I: Quickly into QuickBooks............................................................5
Part II: Daily Entry Tasks.......................................................................5
Part III: Stuff You Do from Time to Time..............................................5
Part IV: Housekeeping Chores..............................................................5
Part V: The Part of Tens.........................................................................5
Part VI: Appendixes................................................................................6
Conventions Used in This Book.....................................................................6
Part I: Quickly into QuickBooks .....................................9
Chapter 1: QuickBooks: The Heart of Your Business . . . . . . . . . . . . . .11
Why QuickBooks?..........................................................................................11
Why you need an accounting system................................................12
What QuickBooks does........................................................................12
What Explains QuickBooks’ Popularity?.....................................................14
What’s Next, Dude?........................................................................................15
How to Succeed with QuickBooks...............................................................16
Budget wisely, Grasshopper...............................................................16
Don’t focus on features........................................................................16
Outsource payroll.................................................................................18
Get professional help...........................................................................18
Use both the profit and loss statement and the balance sheet......19
Chapter 2: Answering Mr. Wizard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
Getting Ready for the Big Interview.............................................................21
The big decision...................................................................................22
The trial balance of the century.........................................................23
The mother of all scavenger hunts..............................................................26
Doing the EasyStep Interview.......................................................................27
Tip 1: Get to know the interview protocol........................................29
Tip 2: Take your time...........................................................................30
Tip 3: Get industry-specific advice.....................................................30
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Tip 4: Accept the suggested filename and location.........................31
Tip 5: Go with the suggested chart of accounts...............................31
Tip 6: Consider tracking all your expenses with your
checkbook.........................................................................................32
Tip 7: Add accounts you need............................................................34
The Rest of the Story.....................................................................................34
Should you get your accountant’s help?.....................................................35
Chapter 3: Populating the QuickBooks Lists . . . . . . . . . . . . . . . . . . . . .37
The Magic and Mystery of Items..................................................................37
Adding items you might include on invoices....................................39
Creating other wacky items for invoices...........................................46
Editing items.........................................................................................49
Adding Employees to Your Employee List..................................................50
Customers Are Your Business......................................................................52
It’s Just a Job...................................................................................................55
Adding Vendors to Your Vendor List...........................................................58
The Other Lists...............................................................................................62
The Fixed Asset list..............................................................................62
The Price Level list...............................................................................63
The Sales Tax Code list........................................................................63
The Class list.........................................................................................64
The Other Names list...........................................................................64
The Sales Rep list.................................................................................65
Customer, Vendor, and Job Types list................................................65
The Terms list.......................................................................................65
The Customer Message list.................................................................66
The Payment Method list....................................................................66
The Ship Via list....................................................................................66
The Vehicle list.....................................................................................66
The Memorized Transaction list........................................................67
The Reminders list...............................................................................67
Organizing and Printing Lists.......................................................................67
Jotting down notes for list items........................................................68
Printing lists..........................................................................................68
Exporting List Items to Your Word Processor............................................69
Dealing with the Chart of Accounts List.....................................................69
Describing vendor balances...............................................................70
Camouflaging some accounting goofiness........................................70
Supplying the missing numbers.........................................................75
Checking your work one more time...................................................77
Part II: Daily Entry Tasks ............................................79
Chapter 4: Creating Invoices and Credit Memos . . . . . . . . . . . . . . . . . .81
Making Sure That You’re Ready to Invoice Customers.............................81
Preparing an Invoice......................................................................................82
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Table of Contents
Fixing Invoice Mistakes.................................................................................88
If the invoice is still displayed on-screen..........................................88
If the invoice isn’t displayed on-screen.............................................89
Deleting an invoice...............................................................................89
Preparing a Credit Memo..............................................................................90
Fixing Credit Memo Mistakes.......................................................................94
Printing Invoices and Credit Memos...........................................................94
Loading the forms into the printer....................................................94
Setting up the invoice printer.............................................................95
Printing invoices and credit memos as you create them................97
Printing invoices in a batch................................................................99
Printing credit memos in a batch.....................................................101
Sending Invoices and Credit Memos via E-Mail........................................102
Customizing Your Invoices and Credit Memos........................................103
Chapter 5: Reeling In the Dough . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107
Recording a Sales Receipt...........................................................................108
Printing a Sales Receipt...............................................................................112
Special Tips for Retailers............................................................................114
Correcting Sales Receipt Mistakes.............................................................115
Recording Customer Payments..................................................................116
Correcting Mistakes in Customer Payments Entries...............................120
Improving Your Cash Inflow........................................................................124
Tracking what your customers owe.................................................124
Assessing finance charges.................................................................125
Dealing with deposits........................................................................129
Chapter 6: Paying the Bills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .133
Pay Now or Pay Later?.................................................................................133
Recording Your Bills by Writing Checks....................................................134
The slow way to write checks...........................................................134
The fast way to write checks............................................................140
Recording Your Bills the Accounts Payable Way.....................................142
Recording your bills...........................................................................142
Entering your bills the fast way........................................................146
Deleting a bill......................................................................................148
Remind me to pay that bill, will you?..............................................149
Paying Your Bills..........................................................................................150
Tracking Vehicle Mileage.............................................................................154
Paying the Sales Tax....................................................................................155
A Quick Word on the Vendor Center Window..........................................156
Chapter 7: Inventory Magic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .157
Setting Up Inventory Items.........................................................................157
When You Buy Stuff......................................................................................159
Recording items that you pay for up front......................................159
Recording items that don’t come with a bill...................................159