by Stephen L.Nelson, MBA, CPA QuickBooks ® 2004 FOR DUMmIES ‰ 555251 FM.qxd 12/2/03 4:16 PM Page i 555251 FM.qxd 12/2/03 4:16 PM Page vi by Stephen L.Nelson, MBA, CPA QuickBooks ® 2004 FOR DUMmIES ‰ 555251 FM.qxd 12/2/03 4:16 PM Page i QuickBooks ® 2004 For Dummies ® Published by Wiley Publishing, Inc. 111 River Street Hoboken, NJ 07030-5774 Copyright © 2004 by Wiley Publishing, Inc., Indianapolis, Indiana Published by Wiley Publishing, Inc., Indianapolis, Indiana Published simultaneously in Canada No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Sections 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600. 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For general information on our other products and services or to obtain technical support, please contact our Customer Care Department within the U.S. at 800-762-2974, outside the U.S. at 317-572-3993, or fax 317-572-4002. Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may not be available in electronic books. Library of Congress Control Number: 2003114794 ISBN: 0-7645-5525-1 Manufactured in the United States of America 10 9 8 7 6 5 4 3 2 1 1Q/RZ/RS/QT/IN is a trademark of Wiley Publishing, Inc. 555251 FM.qxd 12/2/03 4:16 PM Page ii About the Author Stephen L. Nelson, MBA, CPA, has a simple purpose in life: He wants to help you (and people like you) manage your business finances by using comput- ers. Oh, sure, this personal mandate won’t win him a Nobel Prize or anything, but it’s his own little contribution to the world. Steve’s education and experiences mesh nicely with his special purpose. He has a B.S. in accounting and an MBA in finance. He’s a CPA in Redmond, Washington. He used to work as a senior consultant and CPA with Arthur Andersen & Co. (er, yeah, that Arthur Andersen — but hey it was 20 years ago). Steve, whose books have sold more than 4 million copies in English and have been translated into 11 other languages, is also the bestselling author of Quicken 2003 For Dummies (from Wiley Publishing, Inc.). Dedication To the entrepreneurs and small-business people of the world. You folks create most of the new jobs. Author’s Acknowledgments Hey, reader, lots of folks spent lots of time working on this book to make QuickBooks easier for you. You should know who these people are. You may just possibly meet one of them someday at a produce shop, squeezing can- taloupe, eating grapes, and looking for the perfect peach. Those folks include my acquisitions editor, Bob Woerner, and my editors, Kim Darosett, Kevin Kirschner, and Joey Carstensen. Thanks to all for a job well-done! 555251 FM.qxd 12/2/03 4:16 PM Page iii Publisher’s Acknowledgments We’re proud of this book; please send us your comments through our online registration form located at www.dummies.com/register/. Some of the people who helped bring this book to market include the following: Acquisitions, Editorial, and Media Development Project Editor: Kevin Kirschner Acquisitions Editor: Bob Woerner Copy Editor: Kim Darosett Technical Editor: Joey Carstensen Editorial Manager: Kevin Kirschner Media Development Manager: Laura VanWinkle Media Development Supervisor: Richard Graves Editorial Assistant: Amanda Foxworth Cartoons: Rich Tennant ( www.the5thwave.com) Production Project Coordinator: Courtney MacIntyre Layout and Graphics: Seth Conley, Michael Kruzil, Jacque Schneider Proofreaders: Kathy Simpson, Charles Spencer, TECHBOOKS Production Services Indexer: TECHBOOKS Production Services Special Help Andrea Dahl Publishing and Editorial for Technology Dummies Richard Swadley, Vice President and Executive Group Publisher Andy Cummings, Vice President and Publisher Mary C. Corder, Editorial Director Publishing for Consumer Dummies Diane Graves Steele, Vice President and Publisher Joyce Pepple, Acquisitions Director Composition Services Gerry Fahey, Vice President of Production Services Debbie Stailey, Director of Composition Services 555251 FM.qxd 12/2/03 4:16 PM Page iv Contents at a Glance Introduction 1 Part I: You Gotta Start Someplace 9 Chapter 1: The Big Interview 11 Chapter 2: Lots of Lists 35 Chapter 3: Sharing QuickBooks Files 69 Part II: Daily Chores 79 Chapter 4: Invoices and Credit Memos 81 Chapter 5: Reeling In the Dough 105 Chapter 6: Paying Bills 127 Chapter 7: Inventory Magic 149 Chapter 8: Keeping Your Checkbook 167 Chapter 9: Paying with Plastic 183 Part III: Stuff You Do Every So Often 193 Chapter 10: Check Printing 101 195 Chapter 11: Online with QuickBooks 207 Chapter 12: Payroll 219 Chapter 13: The Balancing Act 231 Chapter 14: Reporting On the State of Affairs 243 Chapter 15: QuickBooks Dirty Work 255 Chapter 16: Building the Perfect Budget 267 Part IV: The Part of Tens 275 Chapter 17: (Almost) Ten Knowledge Nuggets about Web-ifying Your Business 277 Chapter 18: (Almost) Ten Tips for Business Owners 289 Chapter 19: Tips for Handling (Almost) Ten Tricky Situations 293 Chapter 20: (Almost) Ten Little Ideas for Saving Big on Business Taxes 301 Chapter 21: (Almost) Ten Secret Business Formulas 311 Part V: Appendixes 327 Appendix A: Installing QuickBooks in Ten Easy Steps 329 Appendix B: If Numbers Are Your Friends 333 Appendix C: Project Estimating, Billing, and Tracking 353 Index 359 555251 FM.qxd 12/2/03 4:16 PM Page v 555251 FM.qxd 12/2/03 4:16 PM Page vi Table of Contents Introduction 1 About QuickBooks 1 About This Book 2 What You Can Safely Ignore 2 What You Should Not Ignore (Unless You’re a Masochist) 3 Three Foolish Assumptions 3 How This Book Is Organized 4 Part I: You Gotta Start Someplace 4 Part II: Daily Chores 4 Part III: Stuff You Do Every So Often 5 Part IV: The Part of Tens 5 Part V: Appendixes 5 Conventions Used in This Book 6 Special Icons 6 Part I: You Gotta Start Someplace 9 Chapter 1: The Big Interview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 Getting Ready for the Big Interview 11 The big decision 12 The trial balance of the century 13 The mother of all scavenger hunts 16 Doing the EasyStep Interview 17 Tip 1: Learn the interview protocol 19 Tip 2: Take your time 20 Tip 3: Get industry-specific advice 20 Tip 4: Accept the suggested filename and location 20 Tip 5: Go with the suggested chart of accounts 21 Tip 6: Consider tracking all your expenses with your checkbook 21 Tip 7: Add accounts you need 23 Tip 8: Provide inventory, customer, vendor, and other financial information 23 The Rest of the Story 24 Should you get your accountant’s help? 24 Adjusting for accrual-basis accounting 25 Supplying the missing numbers 30 Checking your work one more time 32 555251 FM.qxd 12/2/03 4:16 PM Page vii QuickBooks 2004 For Dummies viii Chapter 2: Lots of Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35 The Magic and Mystery of Items 35 Adding items you may include on invoices 36 Creating other wacky items for invoices 44 Editing items 47 Adding Employees to Your Employee List 48 Customers Are Your Business 50 It’s Just a Job 54 Adding Vendors to Your Vendor List 57 The Other Lists 61 The Fixed Asset list 61 The Price Level list 61 The Sales Tax Code list 62 The Class list 63 The Other Names list 63 The Sales Rep list 63 Customer, Vendor, and Job Types list 64 The Terms list 64 The Customer Message list 64 The Payment Method list 65 The Ship Via list 65 The Memorized Transaction list 65 The Reminders list 65 Organizing and Printing Lists 66 Jotting down notes for list items 66 Printing lists 66 Exporting List Items to Your Word Processor 67 Chapter 3: Sharing QuickBooks Files . . . . . . . . . . . . . . . . . . . . . . . . . . .69 Sharing a QuickBooks File on a Network 69 User permissions 70 Record locking 71 Installing QuickBooks for Network Use 72 Setting Up User Permissions 73 Specifying Multi-User Mode 77 Working in Multi-User Mode 77 Part II: Daily Chores 79 Chapter 4: Invoices and Credit Memos . . . . . . . . . . . . . . . . . . . . . . . . . .81 Making Sure That You’re Ready to Invoice Customers 81 Preparing an Invoice 82 Fixing Invoice Mistakes 88 If the invoice is still displayed on-screen 88 If the invoice isn’t displayed on-screen 89 Deleting an invoice 89 555251 FM.qxd 12/2/03 4:16 PM Page viii [...]... and your QuickBooks data, reversing general entries, extra security for general ledger closings, and so on The bottom line? Yes, there are several flavors of QuickBooks, but if you’re just trying to get started and want to use QuickBooks, this book works for QuickBooks Basic, QuickBooks Pro, and QuickBooks Premier 2 QuickBooks 2004 For Dummies About This Book This book isn’t meant to be read from cover... Windows 98 For Dummies, which I wrote; or Windows 98 For Dummies, Windows 2000 Professional For Dummies, Microsoft Windows Me For Dummies, or Windows XP For Dummies by Andy Rathbone (all published by Wiley Publishing, Inc.) How This Book Is Organized This book is divided into five mostly coherent parts Part I: You Gotta Start Someplace Part I covers some upfront stuff that you need to take care of before... or higher (I took pictures of the QuickBooks windows and dialog boxes while using Windows XP, in case you’re interested.) 3 4 QuickBooks 2004 For Dummies ߜ You know a little bit about how to work with your computer ߜ You have or will buy a copy of QuickBooks, QuickBooks Pro, or QuickBooks Premier for each computer on which you want to run the program Personally, I use QuickBooks Premier, so this book... through the EasyStep Interview Before you begin the interview, you have to start QuickBooks 2004 To do so, choose Start➪Programs and then click the menu choices that lead to QuickBooks (For example, I choose Start➪Programs QuickBooks Premier➪ QuickBooks Premier.) QuickBooks comes in several flavors The most common flavors are Quick Books Basic, QuickBooks Pro, and QuickBooks Premier These three programs... differ in several significant ways: QuickBooks Pro adds the advanced jobcosting and time-estimating features It also includes the ability to share a QuickBooks file over a network, as I describe in Chapter 3 QuickBooks Premier adds features to QuickBooks Pro for accountants and auditors who want to use QuickBooks for rather large small businesses I used QuickBooks Premier for writing this book, by the way,... different flavors: QuickBooks Basic, QuickBooks Pro, QuickBooks Premier, and QuickBooks Premier: Accountants Edition This book, however, talks about QuickBooks Premier Does this mean that I’ve somehow left you adrift if you’ve got one of these other flavors? No way I wouldn’t do that to you QuickBooks Premier is a superset of QuickBooks Basic and QuickBooks Pro, so by describing how you use QuickBooks Premier,... Payroll service .225 Paying other non-tax liabilities 226 Preparing Quarterly Payroll Tax Returns 226 Using the QuickBooks Assisted Payroll service 227 Using the QuickBooks Do-It-Yourself Payroll service 227 Filing Annual Returns and Wage Statements 228 Using the QuickBooks Assisted Payroll service 228 Using the QuickBooks Do-It-Yourself Payroll service 229 The State... 317 Calculating sustainable growth .318 The First “What Happens if ” Formula 320 xiii xiv QuickBooks 2004 For Dummies The Second “What Happens if ” Formula 321 The Economic Order Quantity (a.k.a Isaac Newton) Formula .324 The Rule of 72 325 Part V: Appendixes 327 Appendix A: Installing QuickBooks in Ten Easy Steps 329 Appendix B: If Numbers Are Your Friends... that QuickBooks Pro and Premier include networking capabilities (which I describe in Chapter 3) and the ability to create estimates and bids (which I describe in Appendix C) The standard version of QuickBooks doesn’t include these features This book works for QuickBooks 2004, although in a pinch you could probably also use it for QuickBooks 2003 or 2005 (I’ve got to say, however, that if you have QuickBooks. .. Recording items that you pay for upfront 151 Recording items that don’t come with a bill 151 Paying for items when you get the bill 152 Recording items and paying the bill all at once 154 When You Sell Stuff .155 How Purchase Orders Work .155 Choosing a purchase order form for you .156 Filling out a purchase order 158 ix x QuickBooks 2004 For Dummies Checking up . Small Business Windows 98 For Dummies, which I wrote; or Windows 98 For Dummies, Windows 2000 Professional For Dummies, Microsoft Windows Me For Dummies, or Windows XP For Dummies by Andy Rathbone. (317) 57 2-3 447, fax (317) 57 2-4 447, e-mail: permcoordinator@wiley.com. Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man logo, A Reference for the Rest of Us!, The Dummies. L.Nelson, MBA, CPA QuickBooks ® 2004 FOR DUMmIES ‰ 555251 FM.qxd 12/2/03 4:16 PM Page i 555251 FM.qxd 12/2/03 4:16 PM Page vi by Stephen L.Nelson, MBA, CPA QuickBooks ® 2004 FOR DUMmIES ‰ 555251