The 5 Basic Functions of QuickBooks

| 2 min read

The 5 Basic Functions of QuickBooks

QuickBooks has a lot of functionality, a ton. All of this functionality though doesn't necessarily mean it's a time saver for you or your business.

The way we're going to organize this for you is by creating the skeleton of QuickBooks.

The skeleton is made up of Vendors, Customers, Employees, Company, & Banking. All have functions that are vital to the integrity of your company file. If they're not done correctly of course you run the risk of disaster.

The problem though when you attempt to utilize every aspect is that you will begin to waste time and very quickly cause extreme disorganization for yourself risking the accuracy of both your Balance Sheet, Profit & Loss, and Cash Flow Statement.

I plan to break this down in a series over the next couple of weeks touching upon each part of the skeleton. For now, lets go over briefly each one touching upon the positives and negatives to each.

  1. Vendors

    The first function you see in the top left corner is Vendors. The vendor's function is primarily used by most businesses for the sole purpose of the Enter Bills & Pay Bills function along with Vendor Center. Other functions include Purchase Orders, Receive Inventory, and the subsequent Enter Bills Against Inventory. The latter I will always recommend be done in another program altogether better equipped to handle this. It can be done in QuickBooks but it requires too much work on the user end to keep updated and correct. In the end, this function is associated with Accounts Payable (A/P) because it's money owed to an existing party and is counted as a liability on your balance sheet. 
  2. Customers

    After Vendors comes Customers; this is where Accounts Receivable works or better known as A/R. Most of the functions in Customers are quite useful. The most common mistake though I see is that businesses will use Create Sales Receipt as a means of creating a Point of Sales (POS). This is all fine and well, I've just never seen this practice done correctly within any small business environment. The better option is to buy a proper POS to handle this. Imagine buying the Canyonero that goes real slow with the hammer down, is the only truck endorsed by a clown and is of course 2 lanes wide and 65 tons of American pride? Sure, it'll go down the highway but it leaves a wake of destruction in its path.
  3. Employees

    I've touched upon this function before and I'll say it again, outsource your payroll. Once you've outsourced your payroll all that's left of this function is the Employees list where you can view a consolidated area just for employee pay. If you pay an employee as a paycheck make sure their name type is Employee. See what we're doing yet? We're simplifying this program so we can work quicker and let other programs do their own specialized services.
  4. Company

    The main function of the Company is the Chart of Accounts. Keeping a clean and simple Chart of Accounts is well worth the time to stay on top of every month after you close your books. Items & Services are key for Customers as this houses all of the information and presets for creating bills. Again though, Inventory Activities and QuickBooks Easy Saver take control of inventory, stay away, outsource it to a different program.
  5. Banking

    The functions of banking are all commonly used whenever I'm in a company file. Alt-W to Write Checks, Check Register to view banking activity, and the Print Checks function to print bills. Most importantly though, be aware of Reconcile and Record Deposit. These functions, when used improperly, lead to the most headaches I see. They must be used and used properly.
The overall point of this article is to point out the key features of QuickBooks that you should utilize and the functionality that should be ignored to save you time.
It can be tempting to use some of the functions above to save time in the short term but in the long term, the costs to fix the damage that is usually inevitably caused are never worth it. Use your head, if it's taking too much time and someone else can do it better, outsource it and become a better business owner.
Need Help with Quickbooks, but want to do it yourself? Try Quickbooks remote training today!

An Affordable Bookkeeping Alternative to a CFO

Outsourcing your bookkeeping is more affordable than you would think. We save you money the moment you hire us by cutting out the expensive cost of hiring an in-house CFO.

Working with a remote bookkeeping service will still provide you with all the value you could get from an in-office bookkeeper but at a fraction of the cost.

Learn more

Learn How We Can Impact Your Business Growth

You’ve got your company’s best interest in mind. Guess what? So do we! You can rest assured that we will work closely with you to create actionable business plans and accurate financial reporting. We offer our toolkit of financial intelligence that will be your greatest asset for business growth.

Contact an Advisor