How to Prevent Duplicate Invoice Numbers in Quickbooks

Using unique invoice numbers is essential to keeping your books in order. If two invoices share the same number, conventional wisdom should tell you that your clients’ respective transactions won’t record properly. Instead of having both transactions listed in your books, you’ll only have one transaction. Of course, this opens the doors to countless other problems, some of which include unreported revenue, outstanding invoice payments and more.

As you may already know, you can easily create invoices using Intuit’s Quickbooks accounting software by logging in to your account, accessing the Invoicing area and clicking “Send invoice.” From here, you can choose the customer whom you want to invoice, their payment terms (e.g. NET 30), and the product or service you sold. You can also choose to either email or mail the invoice. For the former, however, you’ll need to enter the customer’s email address in the form.

Quickbooks also allows you to preview the invoice before sending by clicking the “Print or Preview” button. Furthermore, you can customize the way your invoice looks by clicking the “Customize” tab, followed by “Edit current.” Here, you can select your own custom logo and other designs. While completely optional, customizations such as this are recommended, especially for business owners who use invoices on a regular basis. When you are completely satisfied with your invoice, click “Save and send” to send the customer to the respective customer.

Now that you know a little bit about creating an invoice in Quickbooks, you might be wondering how to prevent duplicate invoice numbers. Assuming you use Quickbooks, you shouldn’t have to worry about duplicate invoices being created automatically. The software automatically creates unique numbers every time a new invoice is created. With that said, there are certain occasions in which duplicate invoice numbers may arise, in which case your best option is to use custom transaction numbers.

Quickbooks will warn you about duplicate bill numbers. It will not warn you, however, about duplicate invoice numbers. To turn on custom invoice numbers, log in to your account and click the Gear icon, followed by Settings > Company Settings > Sales > Customer transactions numbers > Done. Once this feature is enabled, you’ll see an invoice number window on the right of newly created invoice, which you can use to create custom numbers for your invoices.

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What is Cash Flow in Business Accounting?

Maintaining a positive cash flow is important when running a business. Whether your business offers a product or service, you probably need cash on hand to conduct your normal day-to-day operations. But what exactly is cash flow?

Cash Flow: The Basics

Cash flow can best be described as the difference in cash from when the beginning of a period to the end of that period. The beginning period is called the “opening balance,” whereas the end period is called the “closing balance.” If the closing balance is lower than the opening balance, the respective business has a negative cash flow for that period. If the closing balance is higher than opening balance, the business has a positive cash flow.

Cash Flow Statements

In accounting, a cash flow statement is a financial statement that reveals a business’s cash flow. Also known as a statement of cash flows, it’s used to show the short-term financial health of a business. Several third-party entities scrutinize the cash flow statements of businesses, some of which include lenders, creditors, investors and shareholders.

More specifically, a traditional cash flow statement should consist of three primary segments: cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities. Cash flow statements refer to the money coming into a business as “inflow,” whereas the money going out is referred to as “outflow.”

There are several methods used to create cash flow statements, the two most common being direct and indirect. The direct method involves reporting major classes of cash receipts and expenditures. The indirect method, on the other hand, involves the use of net-income as a beginning market, after which it adjusts for all non-cash transactions followed by an adjustment for cash-based transactions.

Goals of Cash Flow Analysis

In addition to cash flow statements, some businesses conduct a cash flow analysis to achieve similar accounting goals. The goals of a cash flow analysis is to determine the rate of return for a project; to determine liquidity problems; evaluate the quality of income generates by accrual accounting; and to evaluate the risks of a financial product.

Of course, Intuit’s Quickbooks accounting software makes cash flow statements a breeze. You can easily run a statement of cash flow reports by logging in to your Quickbooks account and selecting Reports > All Reports > Business Overview > Statement of Cash Flows.

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What Is Accountants Receivable in Accounting?

In business accounting, accounts receivable refers to money owned for products or services. Also known as A/R, it’s essentially an invoice for payment that hasn’t been received yet. If your business performs a service and allows customers to pay after it has been completed, for instance, you’ll have an accounts receivable for completed jobs that customers haven’t paid for.

The purpose of accounts receivable to keep track of money due. If a customer owes you money, you need a record so you can collect it. Accounts receivables allows business owners to do just that.

Of course, not all businesses need accounts receivables. If your business requires payment at the time the customer purchases the goods or service, you won’t have any money due, in which case you also won’t have any accounts receivables.

Accounts Receivable in Quickbooks

When using Quickbooks, you’ll probably come across accounts receivable. Quickbooks automatically creates and adds them to your chart of accounts the first time you create an invoice. Quickbooks will then use this accounts receivable to track who owes money to your business and how much they owe. This information is listed as accounts receivables in your Quickbooks account. If you have two or more accounts receivable, Quickbooks will allow you to choose the account you want to use when creating a new invoice or entering a customer payment.

Accounts Receivable Financing

There’s also a special type of business financing that involves the use of accounts receivables. Known as “accounts receivable financing,” this is an asset-based financing option in which a business owners sells his or her business’s accounts receivables for capital. The financing company, typically called a “factoring company” pays the business owner for his or her accounts receivables. Rather than paying the business owner, however, the customer pays the factoring company. It’s a mutually beneficial financing option that allows business owners to receive cash in less time while the factoring company earns additional money on the receivables.

Normally, accounts receivables financing companies pay roughly 80% for accounts receivables. If an invoice is worth $1,000, for instance, the factoring company will pay $800 for the invoice. However, the company may also pay the remaining 20% / $200 after it has collected payment from the customer. In this scenario, the factoring company makes a second payment to the business for the remaining amount of the invoice minus a factoring fee.

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How to View a List of Journal Entries in Quickbooks

As you may already know, journal entries are used in Quickbooks to create a record of a transaction, which can be either a debit or credit. It’s essentially a chronological record of a business’s transactions, revealing what the transaction is for, the credit or debit amount, date and other key information. While it’s just one of many accounting tools available in Quickbooks, it’s arguably the most important for these reasons and others. So, if you want to view a list of your recent journal entries in Quickbooks, keep reading for a step-by-step walkthrough.

To view a list of your recent journal entries,  you’ll need to log in to your Quickbooks account and click the Plus (+) sign in the upper-right corner of your home screen, followed by Other > Journal Entry. From here, you should click the icon that looks like a clock in the upper-left corner of your screen, followed by “View More” on the bottom left and “Recent Journal Entries.” Quickbooks will then provide a list of all recent journal entries, which you can go through to analyze and/or double-check to ensure they are correct.

Because many businesses have hundreds or even thousands of journal entries, trying to weed through them all can be tedious and downright time consuming. Thankfully, Quickbooks simplifies this otherwise crude task by offering a filter option. At the top of your screen, you should see an option to filter your journal entries by date. So, if you want to find a specific journal entry from a particular date or month, set the filter option to the appropriate date range. You don’t need to know the exact date; rather, choose a start date and end date that corresponds for the date on which you believed the journal entry was created. As long as it’s within this range, the journal entry should appear.

Hopefully, this gives you a better understanding of how to view journal entries in Quickbooks. Alternatively, you can view them by pulling a Journal report. This is done by selecting on the left-hand side, at which point you can type “Journal” into the search box. From here, click the “Customize” button > expand the “Filter” section > click “Transaction Type” > choose “Journal Entry” > Run Report. This will essentially run a Journal report that only includes your journal entries.

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How to Use Assembly Items in Quickbooks

In Quickbooks, an assembly item is a line item used when creating a purchase or sales form. They are used to combine inventory parts and sub-assemblies together. When you create an assembly item in Quickbooks, the inventory parts and sub-assemblies (assembly items) in your Bill of Materials are subtracted from your inventory, which in turn increases the total quantity of the respective assembly item. To learn more about Quickbooks assembly items and how to use them, keep reading.

There are two primary steps required to create an assembly item in Quickbooks. First, you’ll need to tell the Bill of Materials what components are needed to make the item, after which you can build a quantity of the item so that Quickbooks can subtract the parts from the inventory and then add the new quantities of the respective item. When you build an assembly item, the inventory parts are erased as separate parts in your inventory. This is because they are converted to a new item known as an inventory assembly.

Once you’ve defined your assembly items, you’ll notice the items added to your inventory as a “build.” Basically, assembly builds are used to ensure that inventory quantities are correct. Building an assembly item automatically subtracts the inventory parts and sub-assemblies from the Bill of Materials, and as we mentioned earlier, this automatically increases the quantity of the respective assembly item.

So, when should you use assembly items in Quickbooks? According to Intuit, there are several benefits associated with assembly items. Retailers, for instance, can use them to track finished products separately from individual items in their inventory. Building an assembly automatically adds an assembled item to your inventory quantity while also subtracting the component parts and assembly items in the process.  Therefore, it allows you to see exactly how many assembled and component items you have in inventory.

Assembly items can also be used to customize the price of assembled items. If you want to specify a price for an assembly that’s higher or lower that the total cost of its component items, you can do so by creating an assembly item.

Furthermore, assembly items allow you to see detailed information about your finished products and goods, including the date on which the items were assembled, the quantity of assembled items, the cost of assembled items and a list of all component items.

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How to Sync Quickbooks Between Two Computers

Want to run Quickbooks on multiple computers in your office? Well, you’ll need to sync them with each other first.  Doing so allows business owners and accounts to collaborate on the same company file. If the computers are synced, changes made to one computer’s Quickbooks won’t affect the other. So, for a step-by-step walkthrough on how to sync Quickbooks between two computers, keep reading.

Before we begin, it’s important to note that you need a single Quickbooks company file. If you have two or more company files, you’ll need to merge them together before proceeding. This is done by using the Data Transfer Utility tool, which you can download for free from the Intuit Marketplace. Install the tool on the computer you wish to host your Quickbooks company file. This will be your primary computer that serves as the host for other computers.

When you are ready to sync your two computers together, copy the Quickbooks installers file on both computers. This should bring up a dialog box asking you to confirm installation and agree to the terms and conditions of the license. Click “Yes” to all prompts and proceed with the installation. You’ll then then need to choose “Use Quickbooks on this computer,” after which you can select the option to “Store Company file for Network Sharing.” Next, enter your Quickbooks product license number on the primary computer on which you are installing the software, followed by “Install.” The installer will begin to run, after which you should click “Utilities” and “Host Multi-User Access.”

Next, go to the “Scan Folders” menu and select “Add Folder” followed by “Scan” to begin to scanning the primary computer on which you are hosting the Quickbooks company file. Once the installer has verified your company file, click “Close.”

You aren’t out of the woods just yes. You’ll need to access the “Company” menu and select “Set Up Users and Passwords” for this computer. Go ahead and add a user with  password, and then set up access for the second computer.

On your second computer, select “File,” followed by “Open or Restore Company” and “Open a Company in Quickbooks.” You can then browse to the location of your company file, select it, and log in using the username and password that just recently created in the previous step. Congratulations, you’ve just synced Quickbooks between two computers!

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What is Chart of Accounts in Business Accounting?

In business accounting, a chart of accounts (COA) is a detailed list of accounts used by the respective business. It’s purpose is to define the class of items that the business pays for while also organizing the business’s finances. A typical COA contains lists the type of account and number associated with the account. Normally, account numbers in COAs are at least five digits in length. Each of these digits represents a different division within the company or department.

By defining the class of items for which a business pays, COAs help to segregate various transactions. A COA, for instance, separates expenses from revenue, allowing businesses to see a general overview of their organization’s financial health. While other lists can also reveal a business’s financial health, COAs are simple and easy to create, assuming you know how they work.

So, how are accounts listed on COAs exactly? Normally, they are listed in the order of their appearance on bank and financial statements. This means balance sheet accounts are listed first, followed by asset accounts, liability accounts, equity accounts, etc. However, being that most countries do not have a standard COA — including the United States — some companies may format their COA in a different manner. The key thing to remember when creating a COA is that it should be consistent with your business’s past practices. If use a different format, stick with that format instead of changing to a new format.

There are many different types of accounts, each of which has its own specific use. An asset account, for instance, may include bank accounts with a positive balance, cash, goodwill and accounts receivable. A liability account, on the other hand, represents debt and other financial obligations of the business, including bank loans, credit cards, bonds payable, etc. Other types of accounts used in COAs include equity accounts, revenue/income accounts, expense accounts and contra accounts.

Of course, COAs are also an important part of Quickbooks. Whether it’s Quickbooks Online or Quickbooks Desktop, a COA follows a similar principle by listing all accounts — asset, liability, equity, expense, etc. — used in a business’s transactions. This is perhaps one of the most important elements of Quickbooks accounting, as it helps to keep a business’s financial information and transactions properly organized.

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Why Does Bill Have ‘Unpaid’ Status After Paying It?

Quickbooks supports several different methods for paying bills, including Write Checks and Pay Bills. Only the latter, however, will the place the bill in closed status. If you attempt to bill a bill using the Write Checks feature, it will remain open. As further explained by Intuit, if you use Write Checks and Enter Bills together, the respective check will not be linked to the bill; thus, the bill remains open. This is why it’s a good idea to get into the habi of using the Pay Bills feature, which will avoid conflicts such as this.

So, how do you fix a bill that’s in open/unpaid status because of the Write Checks feature? There are a few solutions, one of which is to remove the bill and create or leave the Write Check entry. However, you should only use this option if you don’t need all of the information associated with the payment in your Accounts Payable report.

A second solution is to link the check to a bill. Assuming the check has been reconciled, you won’t be able to delete it without throwing off your books. You can, however, link the check to the bill. This is done by logging in to your Quickbooks account and changing the Expense account to Accounts Payable. When you reach the written check, simply change the Expense account to Accounts Payable. Next, on the Customer: Job menu, select the vendor’s name. Without entering a name, Quickbooks will reveal an error. After after entering a name for the vendor, click “Save & Close.”

You’ll then need to pay the bill. This is done by accessing the “Vendors” menu, followed by “Pay Bills.” From here, choose the bill or bills associated with the check. Next, click “Set Credits” and check the box labeled “credit.” You can then adjust the total amount of the credits as needed. When you are finished, click “Done,” followed by “Pay Selected Bills.” Assuming you followed these steps correctly, the bill will appear as paid status instead of open/unpaid.

The bottom line is that you need to fix any paid bills that appear as open/unpaid. Failure to do so will throw off your books. Thankfully, Quickbooks simplifies this process by offering several solutions. Refer to the options listed here to ensure that paid bills show as paid in your Quickbooks account.

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How to Record Opening Balance in Quickbooks

In accounting, an opening balance is the amount of money in an account, either when it was initially created or at the beginning of the fiscal year. Regardless of the type of account, it’s important to record the correct opening balance; otherwise, your entire books will be thrown off. Thankfully, Quickbooks simplifies the process of recording opening balances, which we’re going to explore in this blog post.

Before we begin, it’s important to note that you should not enter an opening balances on accounts that did not have a balance before the date specified on your “Quickbooks start date.” If the account had a balance after the date listed here, however, you should record that balance.

There are several ways to record an opening balance in Quickbooks, one of which is by clicking F1. Alternatively, you can select “Should I enter an opening balance” when setting up either an account, customer, or vendor in Quickbooks. This will bring up a new window that walks you through the process of recording an opening balance. This is arguably the easiest way to record opening balances, as you simply need to complete the fields and proceed with the steps listed on screen.

Furthermore, you can record an opening balance when using a general journal entry created from the Balance Sheet for the previous year. However, there are a few things you should know when recording opening balances from a general journal entry.

According to Intuit, business owners and accountants should consider using an Opening Balance Equity when recording opening balances from a general journal entry. The Opening Balance Equity works to offset the account; thus, ensuring the journal entries are balanced.

If you are recording balances for the start of the fiscal year, you may want to consider entering a balance for the previous year’s retained earnings instead of recording every account for income, expense and cost of goods sold (COGS).

Keep in mind that you can only record one accounts receivable or accounts payable transaction for every general journal entry. As such, you’ll have to create multiple journal entries to have the balances for your accounts. Also, be sure to specify a vendor or customer name in the “Name” field of your general journal entries to accounts payable, receivable and sales tax payable.

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