Job Costing in QuickBooks

A job is a project of a customer.  Job costing is the tracking of expenses for a particular job.  This is very important because it will give the owners an idea on which job is profitable or not and of course it will also measure the overall health of the business.  Construction companies, architects, wedding planners and lawyers are just some examples of businesses that needs job costing.

In QuickBooks, job costing allows business owners to see how much they spent and made for each of the jobs of his customers.  So  how can we get a Profit and Loss per Job in QuickBooks? It's very simple.

Steps:

1. In purchasing inventory or paying for services, we use the icon for the Purchase orders, Enter Bills or Write Checks.

2. The most important step in tracking job costs for a certain project is to put the customer name or job in the column designated once we purchase then uncheck the billable column.

3. Invoice the customer the usual way.

4. Now your reports are ready! Go to Reports > Jobs, Time & Mileage then choose from the available reports. You may try the Profit and Loss by Job or the Job Profitability Summary.  If you used estimates before creating the invoices, you may also check the Job Estimates vs Actual Reports.

For any questions, email us at albqbsolutions@gmail.com

Entering Batch Transactions in QuickBooks

Entering batch transactions in QuickBooks is every bookkeeper's solution to their dilemma of entering backlog transactions especially if it involves a number of months.  It's a good thing if you already have an excel file of the transactions because it can easily be exported to QuickBooks by just copy and paste after doing some modifications in the columns.  If there is no excel file yet and all you have are just raw data like the hard copy of receipts or invoices then at least you don't have to click Save for every transaction and it will at least save some time and effort.  This feature started in QuickBooks Accountant 2013 and QuickBooks Enterprise Accountant 2013.  In these editions, we can do batch entry for checks, deposits and credit card charges.  But in the 2014 editions of QuickBooks Accountant and QuickBooks Enterprise Accountant, we can also batch entry the invoices, credit memos, bills and bill credits in addition to checks, deposits and credit card charges.

Steps:

1. Click the Accountant menu then choose Batch Enter Transactions from the drop down.

2. In the Batch Enter Transactions window, choose what type of transaction you would like to export. In this example, we use checks so you need to choose from which bank account you take the money from.

3. Make sure that the columns in your excel file are the same as the columns in QuickBooks. You may click the Customize button to do this.

4. Once QuickBooks has the same columns as the excel file or vice versa, you may now copy from excel then position your cursor in the first field in QuickBooks then click Paste.

5. Review the entries. If there are red entries, it means that there is an error. You may hover your mouse on the red entries and you can see an error message at the bottom of the page.

6. After being fixed, click Save Transactions at the bottom then you're done.

Tips:
1. Create a backup first before copying from excel.
2. Make sure that the vendor names in excel are the same spelling as what you have in QuickBooks because it will prompt you to add the vendor. Do the same thing with customers if you enter deposits and invoices.
3. Make sure that the accounts are the same spelling as what you have in QuickBooks because it will also prompt you to add a new account.
4. Make sure that the amounts doesn't have a currency. You may format the excel file first as plain numbers.
5. If the account is a sub account, the format should be like this - Automobile Expense:Gasoline Expense. Please refer to Step 5 and 6.

Entering Beginning Balances of Inventory in QuickBooks thru Add/Edit Multiple Feature

1. Click the Items and Services icon from the Home Page > Right click anywhere in the items table > choose Add / Edit multiple list from the dropdown.

2. Select a list > Make sure that you choose Inventory Parts in the dropdown list.

3. Fill out the item name > then put in sales and purchase description (if any)

4. Enter quantity on hand, as of date (your own cut off date) then enter the total value of the inventory (or you may right click > Customize to just enter the cost per inventory to automatically get the total value.

5. Enter COGS account which is usually Cost of Goods Sold.

6. Enter the Income Account which is usually Sales, Revenue, Service Income.

7. Asset Account should be Inventory Asset or you can point this to a specified asset account.

8. Enter the Sales Tax code.

9. Once complete, click Save Changes in the lower right.

Important : If you have many inventory to input, you may also use this Add / Edit multiple window to copy / paste from excel. Just make sure that the columns in your excel file are the same with the columns in this window. Just right click then click Customize your columns.

Factoring in QuickBooks (Selling your Receivables)

Accounts Receivable is a Current Asset. One definition of an asset is something that has value and can be sold. So some companies, to be paid faster, sell their receivables. Sometimes this is referred to as “factoring.” Why? I don’t know. Be aware that “factoring” has another meaning that has nothing to do with Accounts Receivables.

Selling your receivables is a form of financing: we receive a percentage of our accounts receivable from the factoring company and we pay interest in the form of “factoring service fees.” We benefit by receiving cash sooner than we would otherwise. The factoring company benefits by investing in our receivables and receiving a return on that investment.

Be aware that this is just one way to set up your vendors and accounts for factoring. There are other ways to do it.

Set Up

Set up the buyer of your receivables (your bank, a factoring company, an investor) as a Vendor in the Vendor Center. You will need this vendor to record interest paid and additional expenses.

Set up an account of type Bank, as a contra account to A/R. You will use this account to receive payments from the Factoring Company. (See example below)

Set up an account, either Expense or Other Expense called “Factoring Service Fees.”

Example:

1.     You are the bookkeeper for Larry’s Landscaping. Your company did $1,000 of landscaping services for John Smith. Because Larry’s Landscaping needs cash immediately, you will invoice John Smith for $1,000 and then sell the receivable to the ABC Finance Company for $950. John Smith will write his check to the ABC Finance Company for $1,000.

2.     Enter an invoice to John Smith for $1,000.00 in landscaping services. In the memo, include instructions that the check is to be written to the ABC Finance Company.

3. Larry’s Landscaping receives a check for $950 from ABC Finance. Enter a Journal Entry:

1. a. Debit Cash for $950.00
2. b. Debit Factoring Service Fees for $50.00
3. c. Credit the A/R Contra Account for $1,000:
3. 4.  Enter a Receive Payment:
1. a. Bank account is the A/R Contra Account.
2. b. Customer Name is John Smith.
3. c. Payment amount is $1,000
4. d. Apply the $1,000 payment to the $1,000 Invoice.
5. e. In the memo, include that the check is from ABC Finance Company.
6. f. Click Save & Close.

4. Notes

   1.   In some cases, your customer will send the payment to your company, in which case, you must send the payment to the factoring company immediately.
   2.   You may be able to direct your customer to create a two payee check, i.e., both your company name and the factoring company name are included in “Pay to the order of” and either company may cash the check.
   3.   Use a Bill/Bill Payment to record any additional expenses from the factoring company.
   
   

Setting Up a Closing Password in QuickBooks

A closing password in QuickBooks is important to control any changes or modifications to the file after the books have been closed or if the bank accounts have already been reconciled. Only the Admin can do this function. Once there is a closing password, the other users can’t make any modification to the file without informing the Admin. To do this, click the Edit Menu > Choose Preferences > Go to Accounting then Company Preferences > Click Set Date / Password at the bottom of the window > Enter the closing date and your preferred password.

Write a refund check for a cancelled order

Use this procedure when a customer makes a down payment on goods or services and then cancels the order.
Note: This procedure assumes that you recorded the down payment in the Receive Payments window. To ensure proper accounting, you must record down payments in the Receive Payments window instead of the Make Deposits window.
To do this task

1.      Go to the Banking menu and click Write Checks. 

2.      Fill in the customer's name and the check amount.

3.      (Optional) Enter a memo to remind yourself what the check was for.

4.      In the Account field of the detail area, assign the check to Accounts Receivable.

5.      Save the check.

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After you record the check, you must apply the check as a "credit" against the customer's down payment in the Receive Payments window. This ensures correct accounting for the check.

6.      Go to the Customers menu and click Receive Payments.

7.      Enter the customer's name in the Received From field, but leave the amount at $0.00.

8.      Click Discount & Credits.

Make sure that the check you wrote is selected in the detail area of the payment. If any invoices are selected, clear the checkmarks by the invoices.

9.      Save the transaction.

Write a refund check for an overpayment

Use this procedure when a customer overpays an invoice or statement charge.
To do this task

1.      Go to the Customers menu and click Receive Payments.

2.      Enter the payment in the Receive Payments window.

a.Click the Received From drop-down list and choose the Customer name.

b.Enter the amount of the payment.

c.Click the Pmt. Method drop-down arrow and choose a payment method.

The overpayment box appears where you can choose whether to leave the overpayment as a credit or issue a refund for this amount.

3.      Click Refund the amount to the customer.

4.      Save the transaction.

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5.      Fill in the customer's name and the check amount in the Issue a Refund window.

6.      (Optional) Enter a memo to remind yourself what the check is for.

7.      Click OK.