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How to Record a Customer Loan in Quickbooks

Does your business offer loans to customers? While some businesses require their customers to pay for products and services upfront — or pay after the delivery of a product or the completion of a service — others offer loans as an alternative. With a loan, you can close out all of a customer’s open and unpaid invoices, followed by recording a loan for the customer. The customer will still have to repay the loan, but he or she won’t have any open invoices. How do you record a customer loan in Quickbooks exactly?

Step #1) Access the Chart of Accounts

To get started, you’ll need to access the chart of accounts in Quickbooks. The chart of accounts, of course, is a ledger containing all of the accounts with which your business has conducted transactions. In Quickbooks Online, you can access it by clicking the gear icon on the homepage and selecting “Chart of Accounts.”

Step #2) Specify Non-Current or Other Current Assets

After pulling up the chart of accounts, you’ll need to specify whether the loan is for non-current or other current assets. Non-current assets are intended for loans that must be repaid after the end of the current fiscal year. Other current assets, on the other hand, are intended for loans that must be repaid by the end of the current fiscal year. You can choose between non-current or other current assets by clicking “New” in the chart of account, followed by “Current Assets.”

Step #3) Choose the Detail Type

There are still a few things extra you’ll need to do in order to record a customer loan in Quickbooks. You’ll need to choose the detail type, for instance. For the detail type option, select “Loans to others.” There are other options from which you can choose. Since you are trying to record a customer loan, the correct option is to choose is “Loans to others.”

Step #4) Enter a Name and Save

You can enter a name for the customer loan. Quickbooks doesn’t require you to enter any specific name. Rather, you’ll have the freedom to choose any name for the customer loan. Nonetheless, it’s recommended that you enter a descriptive and relevant name for the customer loan so that you can easily remember it. When finished, click the “Save and Close” option to finish the process. The loan will now be added to your Quickbooks account. You can then proceed to create a journal entry for the opening balance of the loan, followed by applying credits to the loan using the customer’s accounts receivable.

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How to Build a Progress Invoice in Quickbooks

Are you trying to build a progress invoice? Not all businesses send their customers a single invoice consisting of the entire charge for a given product or service (or multiple products or services). Depending on the type of business you operate, you may need to send customers multiple invoices, each of which featuring different amounts. Landscaping and other service-oriented businesses, for instance, often use multiple invoices. Even some product-oriented businesses use multiple invoices. Fortunately, you can build a progress invoice in Quickbooks in just a few easy steps.

What Is a Progress Invoice?

A progress invoice is essentially multiple invoices that, as the name suggests, follows a progressive format. Rather than requiring customers to make the full payment upfront, you can send them a sequence of multiple small invoices. Progress invoices are often used for projects. With projects, customers may have to pay for multiple products and services. You can use a progress invoice so that customers can make partial payments towards the completion of the project.

Steps to Building a Progress Invoice in Quickbooks

To build a progress invoice in Quickbooks, you’ll need to enable this feature. This is done by logging in to your Quickbooks account, clicking the “Settings” menu and choosing “Account and settings.” Next, click the “Sales” tab. You should now see a section labeled “Progress Invoicing.” Within this section is an “Edit” button, which you can click to configure the progress invoice settings for your account. For the option labeled “Create multiple partial invoices from a single estimate,” click the adjacent box so that it places a checkmark inside of it. This will enable progress invoicing in your Quickbooks account.

With progress invoicing enabled, you can now build a template to use for your business’s progress invoices. Go back to the “Setting” menu and click “Custom form styles. Next, click “New style” and choose “Invoice. You can now build a template to use for a progress invoice. Templates for progress invoices work the same as those used for traditional invoices. They show a breakdown of the purchased products or services as well as an “amount due” field. The only difference is that progress invoices are broken up into multiple invoices so that customers can make partial payments over time. Once you’ve created a progress invoice template, you can use it as the foundation for your business’s progress invoices.

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What Are Centers in Quickbooks?

When using Quickbooks, you may encounter Centers. The desktop version of Intuit’s popular accounting software features several sections of transactions. Known as Centers, they allow you to see all transactions involving a particular audience. Whether you own a retail store, an e-commerce store, a business-to-business (B2B) company or any other commercial enterprise, you should take advantage of this feature. What are Centers in Quickbooks exactly?

Overview of Centers in Quickbooks

Centers are sections in Quickbooks Desktop that contain all transactions involving a specific audience. The Customer Center, for instance, reveals all transactions involving your business’s customers. By accessing this section, you can see how much revenue your business generated during a given period. There’s also the Vendor Center. The Vendor Center, as the name suggests, reveals all transactions involving your business’s vendors. If your business purchases products or services from vendors, you can find these transactions in the Vendor Center.

The Employee Center lives up to its namesake by revealing employee-related transactions. Assuming your business has employees, you’ll need to pay them. You can find payments made to your business’s employees in the Employee Center. The Employee Center consists of payroll payments. Using it, you can see when your business paid its employees and how much your business paid them.

How to Use Centers in Quickbooks

Although there are different types of Centers — Customer, Vendor and Employee — they all work in the same way. After accessing a specific Center, you’ll see the names of all individuals in that specific audience in the upper-left corner of your screen. You can then click the area to the right of the names list to view their transactions. Clicking a name in a Center will bring up a details box for that individual.

Of course, you can do more than just view transactions in Centers. You can also edit the information of individuals listed in Centers. Once you’ve clicked an individual’s name in a Center, you should see a details box displayed to the right. In the upper-right corner of this details box is a pencil-shaped icon. Clicking this icon will allow you to edit the individual’s information. Maybe his or her name is incorrect, or perhaps the individual has an invalid email address. By clicking the pencil-shaped icon, you can edit information such as this to ensure that your business’s records are correct.

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An Introduction to the Hybrid Accounting Method

Not all businesses use the same accounting method. Some of them use the cash basis accounting, whereas others use the accrual basis accounting. There’s also the hybrid accounting method, which combines elements from both the cash basis and accrual basis accounting methods. If you’re thinking about using this alternative accounting method, you might be wondering how it works. Below is an introduction to the hybrid accounting method.

What Is the Hybrid Accounting Method?

The hybrid accounting method is an alternative bookkeeping process that features elements of the cash basis accounting method and the accrual accounting method. To better understand how it works, you must familiarize yourself with the two aforementioned accounting methods. The cash basis accounting method involves recording transactions when customers pay your business and when your business pays its customers. The cash accrual accounting method, on the other hand, involves recording money when your business earns it or pays it (e.g. sending or receiving an invoice).

Advantages of Using the Hybrid Accounting Method

There are several advantages of using the hybrid accounting method. It’s a better choice for predicting cash flow, for instance. With the hybrid accounting method, you’ll have the freedom to record transactions either at the time when money is exchanged or when your business it or pays it. Therefore, many businesses prefer the hybrid accounting method because it allows them to predict their future cash flow with greater accuracy. You can essentially change between the cash basis and the accrual accounting methods when using the hybrid accounting method.

Disadvantages of Using the Hybrid Accounting Method

Using the hybrid accounting method, on the other hand, can be somewhat difficult. The Internal Revenue Service (IRS) has specific requirements for this alternative accounting method. If you choose the hybrid accounting method for your business, for instance, you’ll have to create a separate set of records using the cash basis method. The IRS requires businesses to use the cash basis method if they plan on using the hybrid method.

Some businesses may discover that it’s difficult to keep track of transactions when using the hybrid accounting method. As previously mentioned, the hybrid accounting method allows you to record transactions using either the cash basis or accrual method. When switching between these two traditional accounting methods, you’ll have to remember which method you used and for which transactions.

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What Is a Statement of Cash Flows in Quickbooks?

Quickbooks offers a variety of financial reports. When using Intuit’s popular accounting software, for example, you may come across a statement of cash flows. It’s an optional report that provides insight into a business’s cash flow. If you own a business, you should consider running a statement of cash flows.

An Introduction to Statement of Cash Flows

A statement of cash flows is a report generated in Quickbooks that lives up to its namesake by offering an overview of your business’s cash flow. Cash flow, of course, is a measure of liquidity. It reveals the amount of money going into your business versus the amount of money going out of your business.

You can run a statement of cash flows for any given period. Maybe you want to identify your business’s cash flow for the prior month, or perhaps you want to identify your business’s cash flow for a particular fiscal period. With a statement of cash flows, you can find your business’s cash flow for any given period. It’s simply a report that shows revenues and expenses for a given period.

Why is cash flow important exactly? For starters, it reflects your business’s ability to satisfy short-term debt. If your business has poor cash flow, it may struggle to make payments on loans and operational expenses. Strong and positive cash flow, on the other hand, means your business has a high amount of revenue relative to its expenses. Therefore, your business should be able to easily to cover its short-term debt.

How to Run a Statement of Cash Flows

You can run a statement of cash flows by logging in to your Quickbooks account and selecting the “Reports” menu. Quickbooks will then display a list of all available reports from which you can choose. Since there dozens of reports available, you should filter them by entering “Statement of Cash Flows” in the search field. This should remove all other reports, thereby allowing you to select the option for a statement of cash flows.

While optional, you may want to customize your statement of cash flows before running it. You can customize specific parts of a statement of cash flows by clicking the “Customize” button. When customizing a statement of cash flows, you can select a different date range and other options.

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How to Record an Old Check in Quickbooks

Did you forget to record a check that your business issued to a vendor or client? Whether it’s one month old or over a year old, you’ll still need to record it. Failure to record old checks will result in incomplete accounting records that could throw off your business’s accounting processes. When using Quickbooks, though, you can go back and record old checks such as this. For step-by-step instructions on how to record old checks, keep reading.

Steps to Recording an Old Check

In Quickbooks Online, you can record an old check by selecting the “+New” button on the home screen, followed by “Check” under the “Vendors” menu. This will allow you to record a check to your Quickbooks Online account. Of course, you’ll need to enter information about the old check. Quickbooks Online requires you to enter the date on which the check was assigned. Since it’s an old check, the issuance date will be older than the current date. Regardless, proceed by entering the appropriate information about the old check in the appropriate fields.

In addition to entering the date on which the old check was assigned, you’ll need to enter its number. Just click the box labeled”Print later” so that it removes the checkmark from it. When finished, you should see a field for the check number. In this field, enter the number of the old check. Keep in mind that you need to enter the correct check number for it to work. You can only record old checks in Quickbooks by entering the correct number for them.

For the “Pay to the Order” field,” click the drop-down menu and choose the person or organization to which your business issued the old check. You can then enter the dollar amount of the old check in the “Amount” field. For the “Account” field, choose the bank account that’s associated with the old check. Quickbooks should now have your old check on file. To complete the process, click the “Save” button. That’s all it takes to record an old check in Quickbooks.

In Conclusion

Recording an old check in Quickbooks is a breeze. Quickbooks doesn’t require you to record new checks. Even if they are weeks or months old, you can still record them. Just follow the steps outlined in this post.

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How to Manage Vendors in Quickbook

Does your business regularly pay other businesses or subcontractors? If so, you’ll need to add them as vendors to your Quickbooks account. Quickbooks supports both customers and vendors. Customers, of course, are individuals who pay your business for its products or services. Vendors, on the other hand, are businesses and subcontractors who receive money from your business. In Quickbooks, you can easily manage your business’s vendors in just a few simple steps.

Adding New Vendors

To add a new vendor to your Quickbooks account, click the “Expenses” menu and select “Vendors.” From here, choose the option labeled “New Vendor,” after which you’ll see a window with data fields. You’ll need to go through these fields while adding the necessary information about the vendor. The vendor window contains fields for the vendor’s name, title, display name, billing address and optional notes. After completing the appropriate fields, select “Save and close.” The vendor should now be added to your Quickbooks account.

Of course, you should use caution to ensure that you don’t add the same vendor multiple times. In cases of duplicate vendors, you have one of two options: You can either make the duplicate vendor inactivate, or you can merge the duplicate vendor with the original vendor. Allowing duplicate vendors to go unchecked can lead to accounting errors. If the same vendor is listed twice in your Quickbooks account, it can throw off his or her transaction records. For proper bookkeeping, you should either make the duplicate vendor inactive or merge it with the original vendor.

Find All Transactions Involving a Vendor

You can also find all transactions involving a particular vendor. This is done by going back to the “Expenses” menu and selecting “Vendors.” Rather than selecting “New Vendor,” though, scroll through the list until you see the vendor’s name. After finding the vendor’s name, you can select it. You should then see all transactions involving the vendor under the “Transaction List” section.

Print Transactions Involving a Vendor

Quickbooks also allows you to print transactions involving a vendor. To do this, follow the steps listed above to find and select the vendor in your Quickbooks Account. Next, select the “Filter” menu to narrow down the vendor’s recorded transactions. Once you’ve found the transaction that you’d like to print, select the printer button.

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What Is Quickbooks Commerce and How Does It Work?

Have you heard of Quickbooks Commerce? It’s an innovative add-on service offered by Intuit. If your business sells its products online, you may want to use Quickbooks Commerce. You’ll still need a subscription to the standard Quickbooks accounting software. With Quickbooks Commerce, however, you’ll have an easier time listing and managing products on your preferred e-commerce platform. To learn more about Quickbooks Commerce and how it works, keep reading.

Overview of Quickbooks Commerce

Quickbooks Commerce is an add-on service for Quickbooks Online that’s designed to streamline common e-commerce-related processes for businesses. You can use it to connect your Quickbooks Online account to the e-commerce platform or platforms on which your business sells its products. Once connected, it will place all of your sales data in a convenient interface where you can easily access it.

How Quickbooks Commerce Works

In case this is your first time hearing about it, you might be wondering how Quickbooks Commerce works exactly. Quickbooks Commerce lives up to its namesake by offering a variety of tools for managing e-commerce products. When selling products online, you may list them on multiple e-commerce platforms. Rather than having to access each platform individually, you can access them all at once with Quickbooks Commerce. This add-on service will provide a single interface from which you can manage your business’s products. Even if you list them on multiple e-commerce platforms, Quickbooks Commerce will integrate the data into a single interface — your Quickbooks account — where you can manage them with greater ease.

According to Intuit, Quickbooks Commerce is compatible with the following e-commerce platforms:

  • Shopify
  • Amazon
  • eBay
  • Etsy
  • WooCommerce
  • Zapier
  • ShipStation

Getting Started With Quickbooks Commerce: What You Should Know

You can get started with Quickbooks Commerce by purchasing this add-on service from within your Quickbooks Online account. It’s available for all versions of Quickbooks Online, including Essentials, Plus and Advanced. It costs just $20 per month for the first year, after which the price increases. After purchasing Quickbooks Commerce, you’ll have the ability to connect it to your e-commerce platforms. Connecting Quickbooks to your e-commerce platforms will then integrate them so that you can access and manage all your products from a single interface.

It’s important to note that Quickbooks Commerce is still in the early stages of being rolled it. Therefore, it’s not available to all Quickbooks users. If you don’t see the option for this add-on service in your account, you’ll have to join the waitlist.

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An Introduction to Quick Ratio in Accounting

When researching accounting processes, you may come across quick ratio. Millions of businesses calculate their respective quick ratio for accounting purposes. Also known as an acid test, quick ratio provides into a business’s cashflow and, thus, its ability to satisfy debt and liabilities. As a business owner, however, you might be wondering what quick ratio means exactly. This post offers an introduction to quick ratio and how it works in accounting.

What Is Quick Ratio?

Quick ratio is a measurement of how easily your business can pay its debt and liabilities. It essentially reflects your business’s liquidity. The greater your business’s liquidity — meaning it can easily convert assets into cash — the higher its quick ratio will be.

How to Calculate Quick Ratio

There are a few different ways to calculate quick ratio. One of the most common formulas involves adding your business’s cash, accounts receivables and other short-term assets, followed by dividing that number by your business’s short-term debt and liabilities. You can perform this quick ratio calculation for any given period. To determine your business’s quick ratio for last year, for example, just perform the aforementioned calculation using last year’s data.

A quick ratio of 1 means your business’s short-term assets and short-term liabilities were equal for the reporting period. A quick ratio of 2, on the other hand, means your business’s short-term assets were twice as much as its short-term liabilities for the reporting period. Any quick ratio below 1 indicates that your business’s short-term assets were less than its short-term liabilities during the reporting period. You should typically strive for a quick ratio of 1 or higher because it symbolizes positive liquidity.

Why Quick Ratio Is Important

Why should you care about your business’s quick ratio? Quick ratio is all about liquidity. And the greater your business’s liquidity, the easier it will be for your business to satisfy short-term debt and liabilities. Nearly all businesses incur debt. Debt is particularly common during the early stages of a new business. Assuming your business is liquid, you can easily convert its short-term assets into cash, which you can then use to pay off your business’s short-term debt and liabilities.

There are other ways to measure your business’s liquidity. Quick ratio is popular among business owners and accountants, though, because of its simplicity. You can calculate using only your business’s short-term assets and its short-term liabilities. A high quick ratio means that your business has more short-term assets than its short-term liabilities.

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What Is an Inactive Customer in Quickbooks?

When using Quickbooks, you’ll have the ability to create profiles for each of your business’s customers. You can then quickly add these profiles to invoices, allowing for a streamlined accounting strategy. Quickbooks, however, allows you to make customers inactive as well. What is an inactive customer in Quickbooks exactly?

Overview of Inactive Customers

Inactive customers are profiles that your business no longer needs, so they are hidden in your account. All customers in Quickbooks consist of data about a specific customer who has purchased from your business in the past. By default, customers in Quickbooks are active. You can make them inactive, however, to create a cleaner Quickbooks account that improves your accounting strategy.

Both active and inactive customers consist of data-filled profiles about your business’s customers. The difference is that active customers are displayed in your Quickbooks account, whereas inactive customers are hidden. If you make a customer inactive, you won’t be able to find his or her profile in places like menus and lists. The customer’s profile will still be stored in your Quickbook account; it will just be hidden.

How to Make a Customer Inactive

You can make a customer inactive by selecting the “Sales” menu, followed by the “Customers” tab. From the available list, find the name of the customer whom you wish to make inactive and select his or her name. You can then click the “Edit” button for additional options, including the ability to make the customer inactive. After choosing this option and confirming with “Yes,” the customer will become inactive.

Of course, making a customer inactive isn’t the same as deleting a customer. Inactive customers are still stored in your Quickbooks, so you can make them active them without entering their information under a new profile. If an old customer returns to your business, for example, you may want to make him or her active again. Fortunately, Quickbooks allows you to revert customers from inactive to active.

To make an inactive customer active again, select the “Sales” menu and the “Customers” tab like in the previous process. You can then choose the “Customers” tab to see a list of all your customers. To view inactive customers in this list, however, you’ll need to click the “Settings” button and select the option for showing inactive customers. After locating the inactive customer, click the “Make Active” option in the “Action” menu next to his or her name.

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