Posted onJanuary 12, 2021|Comments Off on Reset QuickBooks invoice sequence number
In our previous post, we mentioned resetting the invoice sequence number for the new year.
Invoice number has to be unique and sequential.
Both QuickBooks Desktop and QuickBooks Online do not have a system preference to set the invoice running sequence. If you prefer to have a yearly sequence number for †he invoices (e.g. IN20-10001 for the year 2000 and IN21-10001 for 2021), you can overwrite the invoice number when entering the first invoice in 2021. The subsequent invoice will follow the new order until you reset it again.
The same concept applied when switching from a manually invoicing system or another computerised accounting system to QuickBooks. You enter the first invoice with your preferred invoice number, and the next invoice generated will then follow the new sequence. And, of course, you can continue with your existing running sequence. Example: the last invoice entered in your old accounting software is 4321, you enter the first invoice in QuickBooks as 4322, and the next invoice number generated from QuickBooks will continue as 4323 automatically.
There are some differences between the Desktop and Online version. Some features in QuickBooks Desktop may not be available in the Online version. Consider sign up a trial or attend a demo if you have been using QuickBooks Desktop for years and thought of switching over to the online version.
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You may use the class as a departmental account. Set up marketing, R&D, production, etc. as a class; then, tag it to each income or expense account when creating an invoice or bill. The profit and loss report shows the income and expense breakdown by class once the transaction saved. QuickBooks class feature is a unique way of analysing the business account and less tedious in setting up compared to the sub-ledger method used by other accounting systems.
There are many other ways of using the class feature in QuickBooks:
A Law firm uses the class to allocate income and expense of each lawyer.
Use it to track the running cost of the sales team or vehicle.
Property management business uses the class feature to analyse the profitability of each property.
Or you may use the class to track local and overseas sales.
The class feature is flexible and is up to your imagination to apply it into your business account.
Each transaction consists of a header and a detail section. For payment transaction, the payee and bank are part of the header section, whereas the accounts used at the bottom of the transaction are the detail section. Each of the expense account at the detail tagged to a class, and pick up by the Profit & Loss by Class report once transaction saved. But if you print the Balance Sheet by Class from QuickBooks Online, the amount paid from the bank account will group under the unassigned classification since there is no class field available at the header.
You may consider using a location feature, for branches or retail outlets, in QuickBooks Online instead of a class. The data entered will show in both Profit & Loss and Balance Sheet.
The location field is at the transaction header section, which breaks down the accounts used in both the header and detail section. Location is a better choice for businesses that have multiple branches, but you cannot have multiple locations in one transaction (at this moment). You may have to get the supplier to change the way they bill or change the internal workflow if they bill you more than one branch in a single invoice.
Technology is evolving, QuickBooks introduces new feature from time to time. Who knows? Maybe someday there might be a better way of using or reporting by class and location 🙂
Posted onMay 24, 2018|Comments Off on Change of account type in QuickBooks Desktop accounting software
The account type of each account has to be correctly specified when you create it. QuickBooks uses the account type to form financial report; below is a sample structure of a Profit & Loss report.
Less: Cost of Goods Sold
Net Ordinary Income
Add: Other Income
Less: Other Expenses
The presentation of the report gets affected when a wrong account type used. For example, Transport allowance will group with Cost of Sales if you created it as a Cost of Goods Sold account type instead of Expenses; hence, affecting the Gross Profit. QuickBooks does allow the user to edit the wrongly created account type such as from Cost of Goods Sold to an Expenses account type but not from a Bank type to an Expense. You may have to pass journals to rectify the transactions when a mistake made on a non-editable account.
You get a “You cannot change the type of a subaccount. It must be the same type as its parent account” warning message if you try to amend an account type of a subaccount. For example, Transport Allowance has accidentally created under Purchases (which is a cost of goods sold account), to change the type to an Expenses you need to remove Transport Allowance as a subaccount of Purchases first, then change the account type. You should not change the account type if it affects the previous year or prior month’s financial report which you have already filed; instead, you may consider reclassifying the account with a journal.
Traceability and accountability should be the priority before consider making any amendment to the account.
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