Discover the Power of QuickBooks Invoice Example for Enterprises

Quickbooks invoice example for enterprises

Imagine you've just started  your first small business,   but you don't have a handle on your finances. It's absolutely nerve-racking not knowing how  much money is coming in and how much is going   out. In this video, we'll learn how to set  up QuickBooks Online so you don't have this   problem. And we'll do it as a small business  owner with no accounting knowledge required. With QuickBooks Online or what I like to call QBO,   you can track your expenses and  your income, invoice your customers,   pay your bills, manage your taxes, and  view reports for better financial planning. Let's dive in. To get QBO, head to the  following website. You can click on the   card in the top right, or I've included  a link in the description below. First,   let's scroll down and select our plan. Now, if you're the only person  managing your company's finances,   you can get all the core functionality  in simple start. If you need one or two   employees helping you out, then you  need to look at Essentials or Plus. Plus is also useful if you have inventory  to manage and you don't have a solution   yet. Advanced is definitely for  more medium-sized businesses. Because you can get all the core functionality we  mentioned earlier in simple start, I'm going to   choose that plan. When you sign into QBO for the  first time, it'll ask you a number of different   questions about your business to personalize your  experience. Then you'll land here, your home base,   from which you can do a number of different things  in the product, like manage your transactions,   make sales, pay your vendors, and so on. We'll  get to all of those, but the number one thing   you need to start with is to connect your credit  card and bank account. So, we'll start there in   the transactions view. From here, let's click  connect account. Next, type in the name of your   bank account or your credit card. Once you find  your financial institution, you can click on it   and sign in to import your transaction history  into QBO. You should do this for every credit   card and bank account that you use with your  business. After you connect your accounts, you'll   land here on the transactions page. All of these  transactions are for my donut shop, David's Donut   Den. Now I need to help QBO understand what these  transactions are by assigning them to categories. This is important because it helps me with  budgeting, accurate financial reporting,   as well as proper tax compliance.  Let's start with the first transaction. Now, this was an event that we catered for the  Kevin Cookie Company. And there's a couple of   things that we need to tell QBO about. The  first is the name of the customer. Well,   it's the Kevin Cookie Company, and I already  have them in my list. But in case I didn't,   I could select add new customer and input all  of their information right from this page. Next, I need to categorize the  expense. When you start in QBO,   you'll have a limited set of categories to  work from. I highly recommend that you talk   with an accountant to make sure that you've got  the right set of categories for your business.   Every business can be a little bit different in  how they classify different types of income and   different types of expenses. For now, I'm  just going select sales of product income. Next, there are two other things  you can customize. The first is   tags. Tags are useful when you want  to have a way to search for specific   types of transactions more easily in  the future. You can also use it to   slice and dice your reporting in ways  that QBO wouldn't know about natively. Next, you can also set the memo. Sometimes when your bank or your credit card  brings transactions into QuickBooks, it's not   exactly clear what that transaction is for. So you  can add some clarifying information, for example,   that this is a catering event, so that anybody  who goes back to this transaction in the future   will understand what it's for. When you're done,  you can click on confirm and the transaction is   categorized. Next, let's tackle an expense  transaction. Here, I've got a line item for   paper cups, which I purchased from Carla's Cups.  Just like before, I need to select the customer   or the vendor. This time it's the vendor, so I'm  going to select Carla's Cups right from this list. Next, I'll select the category. This one  falls under supplies and materials for me,   so I'm going to select that category. I can also type in tags or change the memo,  just like before. Now this time, before I select   confirm, I know that paper cups is a recurring  expense, and I don't want to have to set this   up every single time a new expense comes in for  paper cups. So, I'm going to click on create rule   to handle this for me automatically. Rules are  a simple but powerful tool in QBO. They help you   find transactions that match specific criteria  and then automatically categorize them for you. Let's get started and do this for paper cups.  So first, I'll set a rule name and then look at   the criteria that QBO has selected. You'll see  that it's already set that when the description   contains paper cups, this rule fires. And then at  the bottom, it's assigning the transaction type,   the category we just set, the vendor, and then all  the other fields that we just looked at as well. Finally, there's one little setting here that's  important to pay attention to. When it's checked,   every transaction that matches this rule  will be automatically categorized and   confirmed for you. But if you want to still  review that the categorization is correct,   you can uncheck this and then click save. Now you see that Carla’s Cups is there, not  just for the transaction we just looked at,   but also for the same paper cups  transaction that happened last week,   and I can click confirm right here  for both of these transactions. Next,   I'm going to handle the rest of my transactions.  Now that I've categorized all of my transactions,   it's time to bring in some dough  by invoicing our customers. So,   I'm going to click over in the sales, invoices,  and we'll get started. Click create invoice. So, it turns out that Kevin Cookie  Company loved our donuts so much the   last time that they've asked us to  cater their next event as well. So   let's start by targeting the Kevin  Cookie Company for this invoice. And next we'll scroll down to the list  of products that we're providing for   them. They really liked our baker's assorted  dozen. And when we click on this dropdown,   you'll see that QBO has saved this line item  from the last invoice that we've created. They've also saved the unit price.  And when I change the quantity,   the total amount updates as well. Now the Kevin Cookie Company also wants an  order of apple fritters. We don't have those   in our inventory yet, but we're about to start  offering them. Let's add them to our product list. First, let's set the name, Apple fritters. And next we'll set the item type. Now  on the QuickBooks simple start version,   we've got two options here. First is service,  which is used for any non-physical good. The   next is non-inventory item, which just means  we're not tracking the inventory of this item   within QBO. If we wanted to track inventory,  we have to use the plus or the advanced   subscription. Because this most applies to our  Apple fritters, we'll choose non-inventory item. Next, you can select a SKU if you have one,  and then you can select a product category. Product categories are useful when you have many  different products that you need to organize,   not just for yourself, but for your customers  as well. Scrolling down, we're in the sales   section. The description is a customer facing  description of the product and the price / rate,   that's the unit price. Now we charge a lot for our  Apple fritters, but people sure seem to love them. Next, the income account. Remember back to when  we were categorizing our transactions and we had   a list of categories to look through? This is  the same list. So now I can say that anytime   someone pays for a set of Apple fritters, it  goes into the sales of product income category. Next, if you have special sales tax handling rules  for this type of item, you can click on edit sales   tax to set that category directly. Because there's  no special needs for Apple fritters specifically,   we'll leave this as the default and click create  new. We know that they want five dozen Apple   fritters, so let's change the quantity from  one to five, and you'll see again the total   amount updates. We're also going to make sure  that we're charging sales tax for the baker's   assorted dozen, and you'll see instantly that  QBO handles the sales tax calculation below. Finally, if we direct our attention to  the bottom left, you'll see the customer   payment options where we can enable  or disable different payment options,   including Apple Pay, most major credit  cards, as well as direct bank transfer. To set this up, you'll need to go through  a special process to make sure that you   can accept payments into your bank account.  I'll take care of this later. For now though,   the total amount is good. Let's send the  invoice. Here QBO gives you a chance to   review everything that gets sent to your  customer, including the invoice link,   any special text that you want to send, as well  as the line items of the specific invoice. If   you want to make any specific tweaks, you  can edit them here on the left-hand side. This all looks good to me though, so I'm  going to click send invoice. All right,   so down below, you can see that we have our open  and outstanding invoice, and up above, we now   have two different visuals which indicate both  the status of our unpaid and our paid invoices. We've taken care of billing our  customers. Now let's make sure   that our vendors are getting paid. We'll  head over to the expenses bill section. Bills is valuable when you have  vendors issuing you invoices,   and you need to stay organized and  make sure that they get paid on time. Carla’s Cups has just issued us an  invoice for an upcoming order. So,   let's add that to QBO and  make sure that they get paid. In the top right, you can select add  bill, and then upload from computer. I'll take the PDF of the invoice that Carla’s  Cups has sent me and upload it directly to QBO. Now, QBO right now is trying to extract as much  information about the invoice from that document.   And you'll see here that it does a pretty good  job of identifying the vendor as well as the   bill amount. My job is to make sure that QBO  got the right information from the invoice. So,   let's hover over this icon where it says bill  and check that the total amount, $20,000,   matches the amount in the bill amount column on  the right hand side. These match. So I'm going to   click create bill, and this allows me to pay it.  Next, I can click on unpaid bills and see that the   bill is ready to go. It's due today, so I better  schedule the payment quickly. In order to pay   bills through QBO, I do have to select an add-on  service. Luckily, there's a basic version which   allows me five free direct transfers per month.  And I can also choose to send checks if I need to. If you need additional services, the  premium and elite plans are also available. I'm going to click choose plan. I'll go through  the process of setting up my bank account so I   can pay this vendor directly. You can see the  invoices now in our paid list and we're done. Next, let's touch on sales tax and how QBO helps  you stay organized when it comes to tax time. We'll head over to taxes, sales tax. When we  created an invoice earlier, QBO automatically   calculated the sales tax that was due. For  every invoice we create from here on out,   QBO will do the same thing and will track to  what government agency that I owe that sales   tax in case I do business outside of Washington  state. That way, when it comes to tax time, I know   exactly how much I owe to what government agency.  Finally, we put in all this work to track our   money in and our money out. Let's get something  out of QBO by looking at their reports. You can   find them by clicking on reports in the main menu.  Now, there are a ton of different reports in here,   so I'm going to cover my favorites and let you  explore the rest. The first up is the profit   and loss report. This is so important for me to  be able to see what's going in and what's going   out over a certain timeframe and also track  important financial metrics like gross profit   and net income. You can customize these reports  in a number of different ways. Scroll up to the   top to see all of your options. Now, I'm going to  choose one which I think is pretty interesting,   which is comparing this year's performance  with last year's performance at the same time   of year. So, I'll select compare another period,  previous year to date, and then hit run report. And what do you know? It's infinite improvement  since last year. Mama always said that there was   money in the donut business. Let's  go check out some other reports. Here are a few other of my favorite  reports. First up is the balance sheet.   This is a well-known financial report  which tracks your total assets and your   total liabilities. It's a good way to see  the health of your business at a glance. Next, it's always important to pay  attention to your sales. And sometimes   you're interested in who are your best  customers or who are your best products,   so you can focus your attention on them.  The sales by customer summary and sales   by product or service summary will  help you identify those areas of need. Finally, also important to pay attention  to your vendors. If you have a feeling that   you're bleeding cash to one or more vendors, the  expenses by vendor summary will help you identify   that and nip it in the bud if it's really  happening. And there you have it. Now you   have all your financial data in one place. You can  bill your customers, you can pay your suppliers,   manage your taxes, and view financial  reports to make great decisions about   your business. If you learned something  today, please give us a like and don't   forget to hit that subscribe button. This is  David signing out. I'll see you next time.