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QuickBooks Tips & Tricks: The Best of CPA911.Com: Frequently Asked Reader Questions
     

QuickBooks Tips & Tricks: The Best of CPA911.Com: Frequently Asked Reader Questions

by Tom Barich
 

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The only guide that provides solutions to everyday problems encountered by actual users, this compilation is the key to smoothly navigating the QuickBooks program. Tips, tricks, work-arounds, and detailed instructions are featured, based on responses to real-life inquiries from consumers of all levels including beginners, experienced users, and accountants. Based

Overview

The only guide that provides solutions to everyday problems encountered by actual users, this compilation is the key to smoothly navigating the QuickBooks program. Tips, tricks, work-arounds, and detailed instructions are featured, based on responses to real-life inquiries from consumers of all levels including beginners, experienced users, and accountants. Based on the most current version of the program, the handbook covers nearly 40 major topics—from banking tips and invoicing to journal entries, customer payments, and much more—with each subject prefaced by a brief, informative excerpt from a relevant title. Detailed step-by-step instructions and screenshots are featured, and an accessible table of contents and comprehensive index make this a user-friendly and invaluable QuickBooks reference.

Product Details

ISBN-13:
9781932925487
Publisher:
CPA911 PUBLISHING
Publication date:
08/01/2012
Sold by:
Barnes & Noble
Format:
NOOK Book
Pages:
350
File size:
3 MB

Read an Excerpt

QuickBooks Tips & Tricks

The Best of CPA911


By Kathy Ivens, Tom Barich

CPA911 Publishing, LLC

Copyright © 2012 CPA911 Publishing, LLC
All rights reserved.
ISBN: 978-1-932925-48-7



CHAPTER 1

Chapter 1: Accountant - Speak


The labels Debit and Credit can be confusing because they don't follow the logic of your generally accepted definitions for those words. How can an asset be a debit, isn't debit a negative word?

These terms are used all over the world, and date back to the 1400's; so it's too late to try to change them. Just live with them.

The solution is to ignore your vocabulary skills (and your logic) and just memorize the rules and definitions. You'll be amazed at how fast you absorb the concepts once you've begun entering, or examining, business transactions. There are only two rules you have to memorize:

• Debits on the left, Credits on the right.

• Assets and expenses are debits by default; liabilities, equity, and income are credits by default.

— Excerpt from Accounting Savvy for Business Owners

by Phillip B. Goodman CPA (available at www.cpa911.com)


Translating QuickBooks-Speak : A Guide to QuickBooks Terminology

Quite a bit of the terminology QuickBooks uses on menus, dialogs and wizard windows needs translation. The phrases are created by people inside Intuit who have agreed among themselves what the words mean, but their concurrence on these terms doesn't always take the English language into consideration. They've created "insider jargon", which almost never works well when taken "outside." Anyone with a minimum understanding of the English language can make serious mistakes in QuickBooks by applying a logical interpretation of the words and phrases presented in the software.

Accountants and professional bookkeepers who train and support users need to look at the QuickBooks terminology they see on the screen with a fresh eye. Read it as if it were English, and forget that you know what it means in QuickBooks-Speak. That makes it easier to train users properly, and saves you the migraine you get trying to figure out why reports don't make sense.

We hear a lot of negative comments about users' skills and intelligence from accountants who encounter company files that are a mess. Au contraire; users who make mistakes because of the dichotomy between English as spoken by people, and English as turned into QuickBooks jargon, aren't stupid; instead, they're the ones who are literate and logical. They just need to learn a second language: QuickBooks-Speak.

In this article, we'll provide explanations for some of the more egregious examples of QuickBooks-Speak. We'll also present some suggestions for changing the current terminology. Most of these suggestions come from readers of our newsletter, who send us e-mail to explain why users make some of the common mistakes in QuickBooks.


Menu Commands for Transactions

New users, who apply logic to the commands they see on the QuickBooks menus, frequently enter transactions incorrectly.


Receiving Money from Customers

Some of the commands in the Customers menu (those that relate to receiving money from customers) aren't named thoughtfully. They are extremely easy to misinterpret if you understand English and have a logical mind.


Receive Payments

When users who haven't learned QuickBooks-Speak need to record money received from a customer, they almost always select the Receive Payments command when they want to post a transaction involving income, whether the transaction is a cash sale (a sale for which there isn't an existing invoice, such as a retail sale, or a collection of money at the time of service), or a receipt of an invoice payment. After all, the terminology describes the task "record money from customers" perfectly.


Because the Receive Payments command should only be used when payments for existing invoices arrive, using the command to record a

direct sale creates a credit (against a non-existent invoice). This, in turn, creates a lot of billable time for accountants who have to clear up spurious credits that should have been posted as direct sales.

This command should be renamed from its current "insider jargon" to something that's understandable by users of the English language. Readers have suggested the following names:

• Receive Payments on Invoices

• Post Invoice Payments

• Enter Customer Invoice Payments

• Enter Invoice Payments from Customers


Several readers suggested that the command must include the word "Customer" because most people use the word "invoice" generically; that is, you have invoices you send customers and you have invoices you receive from vendors. While QuickBooks calls an invoice a customer-linked document, and calls a vendor-linked invoice a "bill", that's not a rule of the English language outside of the QuickBooks corporate offices.

Feel free to comment, or suggest another name, by writing to editor@cpa911.com.


Enter Sales Receipts

When we ask new users what they think the Enter Sales Receipt command is for, the most common responses are: "Printing a Receipt", and "I have no idea ."

Those answers are very logical; it's the QuickBooks terminology that isn't logical.

This command should be renamed from its current "insider jargon" to something that's understandable by users of the English language. Readers have suggested the following names:

• Enter Direct Sales

• Enter Cash Sales


Many readers explained that "direct sales" is a common term in business for the scenario in which payment is obtained at the time of the sale instead of creating an invoice. Some readers said that training users to translate "Enter Sales Receipts" to "Enter Cash Sales" occasionally caused confusion because some users thought they couldn't use that command for sales paid with a check or a credit card

Feel free to comment, or suggest another name, by writing to editor@cpa911.com.


Paying Vendors

QuickBooks offers two methods for paying vendors:

• Enter the bill (using the Enter Bills command on the Vendors menu), and then enter the payment (using the Pay Bills command on the Vendors Menu).

• Write a direct check, using the Write Checks command on the Banking Menu.


Many (probably most) users depend on both methods: EEnter vendor bills for those vendors who send bills that you won't be paying immediately or won't be paying in full. Use a direct check for vendors that don't send bills (such as rent payments, loan payments that have coupon books or are automatic deductions from their bank accounts, and other "non-billed" transactions).

The Pay Bills command on the Vendors menu meets the criteria for "common English usage Vs. QuickBooks-Speak" confusion. A user who wants to pay a vendor bill that hasn't been entered in the company file often selects this command. Luckily, the Pay Bills window doesn't display a bill, so there's no way for the user to enter an unintended vendor credit.

However, facing the lack of a bill listing, the user often can't figure out how to pay an unentered bill, and ends up using the bank register. Then, the user sends us (or an accountant) an e-mail asking how to assign an expense to a customer/job, or a class. They're even more confused if they're trying to pay for an inventory item (using the check register doesn't receive inventory).

The solution is to have a QuickBooks command for writing direct disbursement checks on the Vendors menu, because it would be unnatural for a user to think, "If I want to pay a vendor I should look on the Banking menu."


Setting Up Items

We receive many messages from users with one of the following complaints:

• "When I create an invoice, it shows up on the bank register as well as on accounts receivable. None of my sales are showing up in my Profit & Loss Report."

• "When I create a sales receipt, it shows up on the bank register twice, once as a minus number, canceling the amount. None of my sales are showing up in my Profit & Loss Report."


Accountants and professional bookkeepers tell us they run into this problem at many client sites.

What's happened, of course, is that the QuickBooks item is configured with a link to the bank account instead of an income account.


Here we have another event where logic and familiarity with the English language backfires. Most people (including people who don't use QuickBooks) think of "bank account" when they see the word Account. When they see the word Account on the Item setup window, they select the bank account. You can't argue with the logic, it makes sense. Watch users set up an item, and when they select a bank account in the Account field, ask why they selected that account from the drop down list of accounts. The answer is probably going to be, "Because that's my bank account."

This field should be renamed from its current "insider jargon" to something that works for users who apply a common, logical, interpretation. Readers have suggested the following labels:

• Post Sales To:

• Income Account

• Posting Account for Sales

• General Ledger Sales Account


Most readers who made these suggestions said that they'd used different terminology when training users to set up an item in QuickBooks. They report that using the words "Post" or "General Ledger" stopped the automatic association of the word "account" with the bank account. If the users didn't understand the meaning of "Post" or "General Ledger", they asked their accountants or bookkeepers, which is better than automatically selecting the bank account.

Feel free to comment, or suggest another label, by writing to editor@cpa911.com.


Installation Dialog Messages

We started translating QuickBooks-Speak into English in our installation instructions for QuickBooks 2006, and we've continued our translation services for installation articles for later versions. Here's what you have to know to install QuickBooks properly (especially on a network).


Database Manager Vs. Database Server Manager

The database manager is not the same program as the database server manager. However, the QuickBooks installation wizard windows, the installation guide that is packed in the box, and the online support documents frequently use one of those names when they mean the other.

The database manager is a software component that manages the database, and it's installed when you install QuickBooks on any computer. Armed with intelligence about the nature of the QuickBooks database, the database manager makes sure data that needs to be written to the database is correct and appropriate before permitting the write (to a user, "write" means "save"). Users actually "talk to" the database manager, and the database manager "talks to" the data file. All communication between the user and the data file takes place through the database manager.

There's no particular reason for QuickBooks to mention the database manager in any documentation aimed at users (although IT professionals may be interested in the topic because of a natural curiosity about all things geeky). You can't "get to" the database manager, it's just there, working invisibly (the geek terminology for this is "transparent to the user").

The database manager should really be renamed from its current "insider jargon" to something that's understandable by users of the English language. Readers have suggested the following names:

• File Manager

• Database Structure Component

• Company File Management System

• Company File Underpinning Software


Feel free to comment, or suggest another name, by writing to editor@cpa911.com.

The database server manager is an application that manages access to all the company files on the datafile server when QuickBooks is used on a network. That's an oversimplification, because the database server manager is also installed in a single-computer installation of QuickBooks, but it doesn't have the same role in that scenario. What's important is the fact that this is not the same component as the database manager that manages the actual data entry for company files, even though there are plenty of instances in documents produced by QuickBooks where the terminology "database manager" is used to describe the database server manager.

When you're installing QuickBooks, the text on the wizard window for installing the database server manager uses the phrase "Company File Server." To most users with any experience with a network environment, the word "server" refers to a computer, not a software application. You should mentally substitute the phrase "database server manager software."

The database server manager should really be renamed from its current "insider jargon" to something that's understandable by users of the English language. Readers have suggested the following names:

• Network Access Manager

• User Access Manager

• Network File Manager


Feel free to comment, or suggest another name, by writing to editor@cpa911.com.


Multi-User Vs. Host Multi-User Access

These two phrases have totally different meanings, but QuickBooks messaging text frequently uses them interchangeably. The misuse of the terms occurs in the wizard windows you see during installation, as well as most of the documentation provided by QuickBooks, including articles on the Support web pages.

Neither phrase is well thought out in terms of the way users understand the English language, nor do these phrases recognize common user scenarios for the QuickBooks software.

Many businesses have a single computer running QuickBooks, but multiple users access QuickBooks on that computer. In that scenario, it's perfectly logical for users to think of their QuickBooks environment as a multi-user environment.

Multi-user is a "mode" that applies to a single company file. When a company file is open in multi-user mode, more than one user can work in the file simultaneously. In order to have multiple simultaneous users, you must have a network.

Host Multi-User Access is a command that sets up the QuickBooks software on a particular computer to serve as the datafile server for network users. If more than one computer on the network has this command activated, users encounter errors when they try to access a company file.

Note that the QuickBooks installation documentation, and the text on the Installation Interview window, can be confusing, because QuickBooks uses the term "Multi-User" when referring to the setup of a datafile server for a network installation of the software. Mentally substitute the phrase "multiple simultaneous users on a network" when you see that phrase.

The command "Host Multi-User Access" and all references to it in the QuickBooks installation wizard windows should really be renamed from its current "insider jargon" to something that's understandable by users of the English language. Readers have suggested the following names:

• Host Files for Network Users

• Central File Location for the Network

• Company Files Storage Computer


Feel free to comment, or suggest another name, by writing to editor@cpa911.com.


Managing a Change of Entity

In a previous newsletter we asked for your opinion on a common problem: A business changes its type of entity. A proprietorship becomes an S-Corp, a C-Corp, or an LLC with multiple managers. An S-corp changes to a C-Corp. An LLC changes to a C-Corp. Do you create a new company file and use the old file for historical information (including tax returns)? Or do you keep the existing file and adjust the information (not just the legal stuff in the Company Info dialog, but also move existing equity amounts into new equity accounts that you set up to match the new entity)?

Most of you said that a new company file is required. Some of the messages we received were very specific: "You must create a new set of books. Think of it this way: the old entity is no longer valid, viable, whatever term you wish to use. It just ceases to exist. The new entity assumes all assets and liabilities of the old entity. In fact, the entity should open new bank accounts."


(Continues...)

Excerpted from QuickBooks Tips & Tricks by Kathy Ivens, Tom Barich. Copyright © 2012 CPA911 Publishing, LLC. Excerpted by permission of CPA911 Publishing, LLC.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Meet the Author

Tom Barich is a Certified QuickBooks ProAdvisor, the author of QuickBooks 2012 QuickSteps, co-author of Running QuickBooks 2013 Premier Editions, and the former technical editor of QuickBooks: The Official Guide.

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