Video QuickBooks Tip: Learning QuickBooks Basics

| 3 min read

Video QuickBooks Tip: Learning QuickBooks Basics

In this QuickBooks video tutorial, I will cover the basics of QuickBooks.  This is a very short video to give you a brief overview of what I consider the core basic bookkeeping functions of QuickBooks.  

I will touch on the chart of accounts, how to enter an invoice, how to enter a bill, how to pay a bill, how to make a journal entry and how to reconcile an account.   


Chart of Accounts

You can access the chart of accounts in QuickBooks from the home screen within the company section.  You will see your current chart of accounts displayed and you can easily sort by any column by clicking on that column name.  

If you need to add an account you can select Account/New in the lower left-hand corner or simply type Ctrl+N.  This will display a wizard that will walk you through adding an account.  It is important to set up your accounts with the correct account type and if you are unsure what type to use consult with your CPA or bookkeeper.  

Another tip I have on the chart of accounts is to keep it simple.  Too many users add too many accounts, which can make financial statements less meaningful.  

You can also customize your small business's chart of accounts, which can help you understand your financials quite a bit better at the end of the month, as well as make your life easier trying to categorize your transactions.

A final tip I will offer on your chart of accounts is to see if there is a standard or typical chart of accounts for your industry.  Using a chart of accounts that is typical for your industry is a great starting point.

I have more information for an explanation about what each of the different categories are in the chart of accounts.

Enter an Invoice

I wanted to go over entering an invoice early because you don't ever want to stop the flow of money into a business.  It is important to know how to create an invoice for a customer and how to deliver it to them quickly so they can pay it.  

You can create an invoice by clicking on create invoices from the QuickBooks home screen or by typing Ctrl+I.   Simply select the customer name, date, quantity and item code.  

Verify the total amount is correct and hit save and close.  

If you would like to get the invoice to your customer as quickly as possible I would suggest selecting the 'to be emailed' box in the lower left hand side.  You can then email your customer an invoice directly from QuickBooks.   

Enter a Bill

You can enter a bill by clicking on enter bills from the home screen.  Do not confuse invoices and bills.  Invoices are products or services you are charging your customers for.  

Bills are goods or services you are paying other businesses for.  

Simply fill in the vendor name, date, ref #, amount, due date, select an expense (or other account type) and enter a memo; then click save.  

This will put your bill into the pay bills window, which leads us to our next basic QuickBooks activity.  

Pay a Bill

You can pay a bill from the home screen by clicking on pay bills.  You then put a check mark next to any bill you want to pay.  

As a side note if you have multiple bills from the same vendor these will be condensed into one payment or check.  You can view the bill details by clicking on 'go to bill.'  

You can set discounts and credits just below the list of bills.  After you have all the bills selected that you want to pay you select a payment date, method and account to use.  As an example let's talk about paying by check.  You would select check as the method and then to be printed or assign a check number.  

You would then select the bank account to pay the bill from and hit save and close.  

I highly recommend printing checks directly from QuickBooks whenever possible as this will eliminate forgetting to enter check information into QuickBooks.  

Create a Journal Entry

You can create a journal entry in QuickBooks by selecting Company/Create journal entry.  That will launch your journal entry screen where you select the date, entry number (optional) and then you enter the specifics of the journal entry below.  

Note that QuickBooks will not allow you to save a journal entry that does not balance.  It is important that you totally understand journal entries before making any.  

It might be best to have your CPA create journal entries rather than attempt it on your own.  

Reconcile an Account

I think that understanding how to reconcile a QuickBooks account is one of the most important bookkeeping tasks you can and should perform on a regular basis.  Reconcile is just a fancy word for balancing the checkbook.  

It is the only way you can be certain you have accounted for all the financial activity that has taken place in your business.  You should also be aware that you can reconcile other accounts besides your bank accounts. Basically, any account that you get a statement on that has a beginning and ending balance can be reconciled.  

Some examples of accounts that can be reconciled include bank accounts, credit cards, investment accounts, and loans.  

Understanding the basic functions of QuickBooks is just the beginning.  QuickBooks has a lot of functionality that it offers beyond the basics.  Learn the basics first and then move on to the more advanced functions.  

If you need QuickBooks help along the way there are lots of advisors that would be more than willing to offer their services.


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