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Creating purchase orders Entering bills to be paid Paying bills Memorizing transactions Setting payment reminders
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Tools for Tracking Expenses
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QuickBooks is a complete and integrated accounting system that tracks and cross-tracks your expenses in a variety of ways that facilitate accurate reporting. The following are the main tracking tools and expense accounting features in QuickBooks: Accounts during the EasyStep Interview (covered in 2) you will set up expense accounts to track various categories of expenses that will ultimately offset revenue to determine your pro t or loss for an accounting period. Classes classes provide a way for you to logically track income and expenses for various activities and segments in your law rm. You can learn more about tracking expenses with classes in 28.
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306 Part IV Managing Your Business with QuickBooks
Customer and job QuickBooks allows you to track expenses separately for each customer and job as previously discussed in 9. Tax tracking QuickBooks allows you to track and associate expenses with speci c lines on your income tax form. This feature is activated during the EasyStep Interview discussed in 2. Purchase orders Purchase orders (POs) help you track inventory, supplies, and services that you sell and use in your business.
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Purchase orders are used to maintain a record of orders for goods and services placed and authorized by your business. As goods are delivered or services are performed or delivered, they are matched against outstanding purchase orders. There are several good reasons for your business to use purchase orders: If you maintain inventory records in QuickBooks, purchase orders provide essential records about what you have ordered and when you can expect to receive it. Use of purchase orders prevents duplication in the ordering process; without a purchase order, an employee might notice that you are out of something and place an order for something that has already been ordered. Purchase orders help show how much money you have committed to purchases that you have not yet received invoices for. If you don t use purchase orders, your QuickBooks system will not show that the money is earmarked for anything until the invoice arrives and is entered. You can create a QuickBooks purchase order by following these steps: 1. Go to Vendors Create Purchase Orders (or click the Purchase Orders icon from the Vendors Navigator screen). The screen shown in Figure 17-1 appears. 2. Select a vendor from the drop-down list that can be accessed from the Vendor eld, or add a new vendor to the list if necessary. 3. Select the Item ordered from the drop-down list that can be accessed from the Item eld, or add a new Item to the list if necessary. 4. Enter the quantity and rate (cost) of each Item in the appropriate column. QuickBooks automatically calculates the total amounts. Verify the information in the Date and Ship To elds. 5. (Optional) If your business keeps track of FOB, enter it in the FOB eld.
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17 Purchase Orders and Accounts Payable
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Select item Figure 17-1: Create a new purchase order using this screen.
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FOB stands for Free On Board, which refers to the terms regarding the transportation of the merchandise. It has no effect on the bookkeeping in QuickBooks. You can use it to indicate where the merchandise is being shipped from, if you nd that information useful.
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6. If you want to ship goods directly to a customer, use the Ship To eld to access the customer address from the drop-down list that appears. Otherwise, QuickBooks will assume, by default, that you want the goods shipped directly to you. (This optional drop-shipping address is a new feature unique to the latest version of the software.) 7. To record the purchase order, click the Save & Close or Save & New button.
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