QuickBooks 2019 All-in-One For Dummies

Stephen L. Nelson, MBA, CPA, MS in Taxation, is a CPA in Redmond, Washington, where he provides accounting, business advisory, and tax planning and preparation services to small businesses. He is the bestselling author of 100-plus books about how to use computers to manage personal and business finances.

Introduction 1

About This Book 1

Foolish Assumptions 2

Icons Used in This Book 3

Beyond the Book 3

Where to Go from Here 3

Book 1: An Accounting Primer 5

Chapter 1: Principles of Accounting 7

The Purpose of Accounting 7

Reviewing the Common Financial Statements 10

The Philosophy of Accounting 23

A Few Words about Tax Accounting 26

Chapter 2: Double-Entry Bookkeeping 27

The Fiddle-Faddle Method of Accounting 28

How Double-Entry Bookkeeping Works 31

Almost a Real-Life Example 37

A Few Words about How QuickBooks Works 44

Chapter 3: Special Accounting Problems 47

Working with Accounts Receivable 48

Recording Accounts Payable Transactions 51

Inventory Accounting 54

Accounting for Fixed Assets 58

Recognizing Liabilities 61

Closing Out Revenue and Expense Accounts 66

One More Thing 69

Book 2: Getting Ready to Use Quickbooks 71

Chapter 1: Setting Up QuickBooks 73

Planning Your New QuickBooks System 73

Installing QuickBooks 76

Dealing with the Presetup Jitters 77

Running the QuickBooks Setup Wizard 79

Identifying the Starting Trial Balance 87

Chapter 2: Loading the Master File Lists 91

Setting Up the Chart of Accounts List 92

Setting Up the Item List 96

Working with the Price Level List 97

Using Sales Tax Codes 97

Setting Up a Payroll Item List 98

Setting Up Classes 99

Setting Up a Customer List 101

Setting Up the Vendor List 105

Setting Up a Fixed Assets List 109

Setting Up a Price Level List 110

Setting Up a Billing Rate Level List 110

Setting Up Your Employees 111

Setting Up an Other Names List 111

Setting Up the Profile Lists 112

Chapter 3: Fine-Tuning QuickBooks 115

Accessing the Preferences Settings 116

Setting the Accounting Preferences 118

Setting the Bills Preferences 121

Setting the Calendar Preferences 121

Setting the Checking Preferences 121

Changing the Desktop View 123

Setting Finance Charge Calculation Rules 125

Setting General Preferences 125

Controlling Integrated Applications 127

Controlling Inventory 128

Controlling How Jobs and Estimates Work 130

Dealing with Multiple Currencies 131

Starting Integrated Payment Processing 131

Controlling How Payroll Works 132

Telling QuickBooks How Reminders Should Work 134

Specifying Reports & Graphs Preferences 135

Setting Sales & Customers Preferences 138

Specifying How Sales Are Taxed 139

Setting the Search Preferences 141

Setting the Send Forms Preferences 141

Fine-Tuning the Service Connection 142

Controlling Spell Checking 143

Controlling How 1099 Tax Reporting Works 144

Setting Time & Expenses Preferences 145

Book 3: Bookkeeping Chores 147

Chapter 1: Invoicing Customers 149

Choosing an Invoice Form 149

Customizing an Invoice Form 150

Invoicing a Customer 160

Billing for Time 166

Printing Invoices 170

Emailing Invoices 171

Recording Sales Receipts 172

Recording Credit Memos 174

Receiving Customer Payments 176

Assessing Finance Charges 178

Using Odds and Ends on the Customers Menu 180

Chapter 2: Paying Vendors 183

Creating a Purchase Order 183

Recording the Receipt of Items 187

Simultaneously Recording the Receipt and the Bill 191

Entering a Bill 192

Paying Bills 196

Reviewing the Other Vendor Menu Commands 199

Chapter 3: Tracking Inventory and Items 203

Looking at Your Item List 204

Adding Items to the Item List 206

Editing Items 220

Managing Inventory in a Manufacturing Firm 227

Chapter 4: Managing Cash and Bank Accounts 233

Writing Checks 233

Making Bank Deposits 241

Transferring Money between Bank Accounts 244

Working with the Register 245

Using Edit Menu Commands 251

Reconciling the Bank Account 255

Reviewing the Other Banking Commands 260

Chapter 5: Paying Employees 263

Setting Up Basic Payroll 264

Scheduling Payroll Runs 270

Paying Employees 270

Editing and Voiding Paychecks 272

Paying Payroll Liabilities 272

Book 4: Accounting Chores 275

Chapter 1: For Accountants Only 277

Working with QuickBooks Journal Entries 277

Updating Company Information 280

Working with Memorized Transactions 280

Reviewing the Accountant & Taxes Reports 281

Creating an Accountant’s Copy of the QuickBooks Data File 283

Using the Client Data Review Commands 291

Chapter 2: Preparing Financial Statements and Reports 293

Some Wise Words Up Front 294

Producing a Report 294

Working with the Report Window 295

Modifying a Report 304

Processing Multiple Reports 310

A Few Words about Document Retention 311

Chapter 3: Preparing a Budget 315

Reviewing Common Budgeting Tactics 315

Taking a Practical Approach to Budgeting 319

Using the Set Up Budgets Window 319

Managing with a Budget 323

Some Wrap-Up Comments on Budgeting 325

Chapter 4: Using Activity-Based Costing 327

Reviewing Traditional Overhead Allocation 328

Understanding How ABC Works 330

Implementing a Simple ABC System 335

Seeing How QuickBooks Supports ABC 337

Turning On Class Tracking 337

Using Classes for ABC 338

Chapter 5: Setting Up Project and Job Costing Systems 343

Setting Up a QuickBooks Job 343

Tracking Job or Project Costs 346

Job Cost Reporting 349

Using Job Estimates 350

Progress Billing 352

Book 5: Financial Management 355

Chapter 1: Ratio Analysis 357

Some Caveats about Ratio Analysis 358

Liquidity Ratios 359

Leverage Ratios 361

Activity Ratios 365

Profitability Ratios 369

Chapter 2: Economic Value Added Analysis 375

Introducing the Logic of EVA 375

Seeing EVA in Action 376

Reviewing Some Important Points about EVA 379

Using EVA When Your Business Has Debt 381

Chapter 3: Capital Budgeting in a Nutshell 389

Introducing the Theory of Capital Budgeting 389

Calculating the Rate of Return on Capital 392

Measuring Liquidity 402

Thinking about Risk 403

What Does All of This Have to Do with QuickBooks? 404

Book 6: Business Plans 405

Chapter 1: Profit-Volume-Cost Analysis 407

Seeing How Profit-Volume-Cost Analysis Works 408

Calculating Break-Even Points 410

Using Real QuickBooks Data for Profit-Volume-Cost Analysis 412

Recognizing the Downside of the Profit-Volume-Cost Model 414

Using the Profit-Volume-Cost Analysis Workbook 416

Chapter 2: Creating a Business Plan Forecast 427

Reviewing Financial Statements and Ratios 428

Using the Business Plan Workbook 429

Understanding the Workbook Calculations 436

Customizing the Starter Workbook 462

Chapter 3: Writing a Business Plan 465

What the Term “Business Plan” Means 465

A Few Words about Strategic Plans 466

Look, Ma: No Strategy 468

A White-Paper Business Plan 470

A New-Venture Plan 473

Book 7: Care and Maintenance 479

Chapter 1: Administering QuickBooks 481

Keeping Your Data Confidential 481

Using QuickBooks in a Multiuser Environment 483

Using Audit Trails 493

Enabling Simultaneous Multiuser Access 494

Maintaining Good Accounting Controls 495

Chapter 2: Protecting Your Data 499

Backing Up the QuickBooks Data File 499

Restoring a QuickBooks Data File 505

Condensing the QuickBooks Company Files 509

Chapter 3: Troubleshooting 517

Using the QuickBooks Help File and This Book 517

Browsing Intuit’s Product-Support Website 519

Checking Another Vendor’s Product-Support Website 521

Tapping into Intuit’s Online and Expert Communities 521

When All Else Fails 522

Book 8: Appendixes 523

Appendix A: A Crash Course in Excel 525

Starting Excel 525

Stopping Excel 526

Explaining Excel’s Workbooks 526

Putting Text, Numbers, and Formulas in Cells 527

Writing Formulas 528

Scrolling through Big Workbooks 529

Copying and Cutting Cell Contents 530

Formatting Cell Contents 533

Recognizing That Functions Are Simply Formulas 534

Saving and Opening Workbooks 537

Printing Excel Workbooks 539

One Other Thing to Know 540

Appendix B: Government Web Resources for Businesses 541

Bureau of Economic Analysis 541

Bureau of Labor Statistics 544

Census Bureau 548

Securities and Exchange Commission 551

Federal Reserve 553

Government Publishing Office 555

Internal Revenue Service 557

Appendix C: Glossary of Accounting and Financial Terms 559

Index 589