You will want to enter all the bills and expenses you receive into QuickBooks so your accounts stay up-to-date. If you just record money that you receive – and not money you will have to pay out--your bank accounts will never balance properly
A majority of companies use an accounts payable system when it comes to paying their bills. This simply means that they do not pay their bills as soon as they receive them. Instead, they wait until later, usually a specific time of month. In the meantime, however, they record the bills so that there is a record that the bill exists when it comes time to pay it.
If you use the accounts payable system, then you will want to record your bills in QuickBooks as soon as you receive them – so you don't forget to pay them.
To record a bill, go to Vendors>Enter Bills.
Choose the vendor that you want to pay. Your vendors should already be in your vendor list, but -- if not -- QuickBooks will allow you to add them.
If you have a purchase order open for that vendor, QuickBooks will ask you if you want to apply this bill to a purchase order.
The Open Purchase Orders dialogue box will open.
Select the purchase order. QuickBooks will fill in the amounts and items for you.
If you do not have a purchase order to apply, fill out the fields in the Enter Bill window. You will want to fill in the vendor, the date, the vendor address, a reference number if needed (Ref No.), and the amount due.
Next, select the payment terms and the date when the bill is due.
You can enter a memo in the Memo line if you want.
Next, we are going to enter line items for expenses and items.
Under the Expenses tab, you are going to assign expense accounts. The expense accounts are the accounts you will use to pay the bill. These should already be listed in your Chart of Accounts.
Next, enter the amount from the bill that will be assigned to the account.
By using the Customer/Job column, you can also apply it to a customer or job.
Put a checkmark in the Billable column if the cost is billable to the customer.
Now, let's click back the Items tab (to the right of the Expenses tab).
Enter the items for which you have been billed. For example, if we purchased 20 toothbrushes, we can list these items to show that the bill is to pay for the toothbrushes we purchased.
When you are finished, click Save & New if you need to record more bills, or click Save & Close.
Recording Bills for Items Already Received
There are times that you may receive items and a bill will not come with those items. The bill will come later. In instances like this, you will record your bill a different way.
The first thing you have to do is enter the received items into inventory when you receive them. To do this, go to Vendors>Receive Items. This will create a blank Create Item Receipts window.
Select the vendor name. If a purchase order exists, QuickBooks will let you know.
Click the Yes button if the items you are receiving are from the purchase order. We are going to click Yes.
You can then choose the purchase order that contains the items.
Go ahead and fill out the fields in the Create Item Receipt window, including the Expenses and Item tabs – as you learned to do in the last section.
When you are finished, click Save & Close. The amount for the items received is now posted to your Accounts Payable account as an Item Receipt type. When the bill arrives and you record it, the Accounts Payable account will be updated. The transaction type will be changed to a bill.
Entering a Bill for Items Already Received
When you receive the bill for the items, it is time to enter the bill. Do NOT use the method in the last section if you have already created an Item Receipt. Instead, go to Vendors>Enter Bill for Received Items.
Choose the vendor. You will then see current items receipts for that vendor.
Select the correct information, then click OK. The Enter Bills window opens.
Fill out the information in the Enter Bills window, then click Save & Close.
When to Pay Bills
The big decision with paying bills is if you should pay them right away or wait. If there's a proper answer to this, then it lies within the accounting system that you use. The first method is the easiest-- paying them right away. The second method, which is called an accounts payable method, gives you accurate records, but lets you pay your bills later. It is called accrual-basis accounting. We'll talk more about this a little later in this article. For now, let's talk about paying bills by writing checks.
Selecting Bills to Pay
When you are ready to pay your bills, you can tell QuickBooks which bills you want to pay. Go to Vendors>Pay Bills. You will see the Pay Bills Window. Place a checkmark next to the bills that you want to pay.
Choose how you want to pay the bill. As you can see above under Method, we have chosen to pay by check.
Once you've selected the bills that you want to pay, click the Pay Selected Bills button. When you choose to click the Pay Selected Bills button, the amount of the bill will be deducted from the assigned account.
You will then see the Payment Summary window.
As you can see in the dialogue box above, you can print the checks right away – or wait until later.
Click the Print Checks button to print the check, click the Pay More Bills button to pay more bills, or click Done if you are done paying bills and want to print the checks later.
Pay by Writing Checks
Whenever you write checks to pay bills, you are doing cash-basis accounting. What this means is that you count your bills as expenses when you write the checks and pay the bills. The only drawback to using this method is that you lose the ability to heavily track your expenses and keep track of your bills. Your bills will pile up on a stack on your desk.
To pay bills by check, go to Vendors>Pay Bills.
Put a checkmark beside the bills that you want to pay.
Go ahead and apply any discounts or credits that you have earned.
In the Payment section, choose the date of payment, then choose the method. Since you're paying by check, choose Check.
Next, check if you want to assign a check number or if the check number will be printed. Assign an account.
Click the Pay Selected Bills button.
Since we chose to assign the check number, we see this dialogue box:
Enter the check number in the Check No. column, then click OK.
You then see the Payment Summary window.
You can either pay more bills or click Done.
Pay by Credit Card
To pay bills by credit card, go to Vendors>Pay Bills.
Put a checkmark beside the bill you want to pay.
Under Method, choose Credit Card, then select the proper credit card account, as shown below.
Click Pay Selected Bills.
You will then see the Payment Summary dialogue box. If you want, you can print a payment stub.
Pay by Debit Card
Since a debit card is linked to a checking account, you will use the same method to pay bills by debit card as you will to pay bills by writing checks.
Write Checks Without Paying Bills
You do not have to be paying bills in order to write checks. If you need to write a check (and not pay a bill), you can either use the register or the Write Checks window.
Using the Register
To write checks for bills the fast way, go to Banking>Use Register.
Choose the account register that you want to use.
It is pretty simple because now all you do is fill in the information in the columns. This is the same information you'd enter on a check.
Just keep in mind that the people you write checks to should be vendors. Also, make sure this person or company is in your lists.
You will also have to choose an account to use for each check. If the account is not listed in the dropdown list, QuickBooks will give you a chance to add it.
Click the Record button when you are finished.
Using the Write Checks Window
You can also write checks the slow way. The slow way takes longer, but it also gives you more options to add payees and do things like tracking expenses and items. If you want to do things like this, it might actually be the quicker way.
To write checks the slow way, go to Banking>Write Checks.
Now you will see the Write Checks Window.
Fill out the check following the instructions below:
Click on the Bank Account dropdown list. Select the account you want to use to write the check.
Enter the check date.
Enter the name of the payee in the Pay to the Order Of line. If you have never paid this person before, you will see a Name Not Found message from QuickBooks. Click either Quick Add or Set Up to add the name to your lists.
Next, type the amount of the check. Simply put the amount next to the dollar sign. QuickBooks will write it out for you.
If you want the address to appear on the check (such as for windowed envelopes), enter that.
You can also put in a memo if you want.
Now, move down to the section of the window below the check. You will see the Expenses tab.
Find the account in your Chart of Accounts that lists the bill or expense you are paying. Expense accounts are usually toward the end of the list.
You can edit the amounts in the Amount column if you need to, add a memo, or assign the expense to a customer or a job.
If you are buying supplies or inventory, click the Items tab. List the items. If the item doesn't already appear on your lists, you will have to click Add New from the top of the list. You will then be required to fill out the New Item window.
When you are finished, you can click the Print button to print the check right then and there. Or you can click Save and New to write another check or Save and Close to close out the Write Checks window.
Setting Up to Print Checks
Printing checks is not like printing documents or spreadsheets. You have to make sure that your printer is set to print them before you begin. In other words, it takes a little preparation. In addition, you need to tell QuickBooks what to put on your checks, from your company name, to the logo, etc.
Let's start by setting up the printer.
Go to File> Printer Setup. Choose Check/PayCheck as the Form Name.
The dialogue box below will appear on your screen.
The Settings tab should be showing. If not, click on it.
Select Check/PayCheck from the dropdown list next to Form Name.
Find your printer in the Printer Name dropdown list.
You will also have to select the printer type from the Printer Type option.
Now, select your check style. Let's cover those together. Voucher checks are just as wide as regular checks, but they are longer. This is because QuickBooks will also print information on the checking account you are using, as well as the items and expense information from the bottom of the Write Checks window. Standard checks fit in legal envelopes. Wallet checks are checks that will fit into a wallet.
If you need to, click the Options button and adjust your printer options. This is for specifying the number of copies, the quality of the print, etc.
Now click on the Fonts tab. This is next to the Settings tab. Choose the font, font style, and size that you want to use on the check.
Click OK when you are finished with the fonts.
Next, click the Partial Page tab. Select a Partial Page Printing style. This allows you to print partial pages to save paper (for the environmentally friendly).
If you want, you can click on the Logo button on the right. A dialogue box will appear. Click File, then find the graphic you want to use. Click OK. Graphics must be in BMP format -- or bitmap.
If you want to add a signature, click the Signature button, click File, and upload a signature file. Again, this must be a BMP file.
When you are finished, click OK.
Printing a Check
If you have filled out a check and you want to print just that check, there's an easy way to do it.
In the Write Checks window, click the Print button.
QuickBooks will then show you a dialogue box that shows you the check number to be printed. Make sure it is the right number. If not, change it.
The Print Check dialogue box will now appear.
These are the settings you just entered when you set up your printer. You can change them if you want to print this check, but these original settings are now your default settings. The next time you print a check, the information in this box will revert to the information you originally entered.
QuickBooks will ask you if your checks printed correctly.
If your check printed correctly, click OK.
Printing Several Checks at Once
If you want to print several checks at once, we are going to tell you how to do it.
Let's say you have just created a bunch of checks and want to print them.
On the last check that you create, click Save, then click the arrow that's below the Print icon under the Main tab at the top of the window.
The Select Checks to Print dialogue box then opens. All unprinted checks will be selected. You can deselect any checks you don't want to print.
Click OK. The Print Checks window then opens.
QuickBooks will ask you if the checks printed correctly after they've finished printing. If they printed okay, click OK.
Now you can sign the printed checks.
If a check doesn't print properly, you will have to reprint it. If this happens, select the checks that need to be reprinted in the Print Checks-Confirmation window (shown above).
Select any checks that didn't print correctly.
Click OK, then go to File>Print Forms>Checks to reprint them.
Printing the Check Register
You can also print the check register. To do so, start by going to Banking>Use Register, then click the Print icon. You may have to choose the proper bank account from a dropdown list if you have more than one account.
Go to File>Print Register. You can also click the print button at the top of the register. You will see the dialogue box displayed below.
Enter the dates you want to print in the Date Range boxes.
If you want the register to display the Items and Expense tab information when printed, check Print Splits Details.
Now click the Print button as pictured above.
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