Beruflich Dokumente
Kultur Dokumente
&
ICT COLLEGE
In collaboration with
QuickBooks Premier
Accounting
COURSE MANUAL
Compiled and edited by:
John W. Gitahi
www.palmaxcollege.com 1
FOREWORD
Accounting packages have become part of the daily life for business manager and
Accountants.
Whether you are a manager in practice, or in training or a student in a business related
field such as KASNEB CPA,s ,ATC or any other such business area including those in
entrepreneurship, you will find Accounting Packages makes your daily duties
tremendously easy.
For instance, with QuickBooks and every other Accounting packages, you just require to
enter the source documents and the computer generates the reports at any time
automatically.
Research has also shown that if you have Accounting packages knowledge, you have a
25% more chance of getting a job.
This manual, has been prepared with you in mind. I have therefore used very simple
language and I will accompany the course with useful exercise at the end of each section.
QuickBooks is a good start for Accounting Packages and offers the best background
towards further training in other accounting packages like Sage, Pastel, Sage Pastel etc
Hope by the end, you will have some basic knowledge in accounting systems operations.
It may not cover everything, but it covers enough to start you off.
First published: 2010 More Printouts:2011
QuickBooks does not have a limit and it can be used in all businesses to record and trace all business
transactions. It is however most common in the following businesses;
a. Accountancy
b. Advertising
c. Architecture
d. Consultancies & Service Businesses
e. Construction
f. Estate Agencies
g. Farming
h. Printing and Graphic Design
i. Product Sellers
j. Writers and other Artists.
STARTING QUICKBOOKS
Click the start button and the point at all programs> then QuickBooks premier or whichever version
installed in your computer (note that Intuit releases newer versions each year though the changes do not
make them fundamentally different)
If you choose not to use the EasyStep Interview, you should follow the setup directions in the "Setting
up a QuickBooks company" chapter in the Getting Started Guide.(normally given by the seller when you
purchase QuickBooks for the first time)
www.palmaxcollege.com 3
NAVIGATING IN QUICKBOOKS
OVERVIEW OF THE BUTTONS ON YOUR QUICKBOOKS WINDOW
INVOICE: for invoicing your customers
PURCHASE ORDERS (PO): FOR POSTING PURCHASE ORDERS
CHEQUE: for posting cheque payments
BILLS: for entering invoices you receive from your creditors
REGISTER: for recording all transactions within an account.
ACCOUNT: for chart of accounts
CUSTOMER: for entering a list of your customers / debtors
VENDORS: for entering a list of your suppliers / creditors
ITEM: for entering a list of items
REMINDERS: for showing your to do notes
2. Chart of accounts
A list of accounts that you use to track how much money your company has, how much money it owes,
how much money is coming in, and how much is going out. When you set up your QuickBooks
company, you can choose a preset chart of accounts designed especially for product sellers.
3. Classes
A way to categorise income and expenses. For example, you can categorise income and expense by a
class that you define, such as departments in a store (women's, men's, children's).
4. Items
The items on your QuickBooks Item list represent the products you sell. Items also include anything you
might want to put on an invoice, such as services, carriage charges, payments, and discounts.
5. Sales forms
QuickBooks has three types of sales forms: a sales receipt (if you get paid immediately), an invoice (if you
get paid later), and a credit memo (for recording a return).
CUSTOMERS (DEBTORS)
A customer is a buyer and also a debtor (when he buys from you on credit). QuickBooks traces customer
entries through the debtors control account. We choose accounts receivable in the chart of accounts
(A/R)
Customer types
When you set up your customers, you can also enter a customer type for each one. The customer type
lets you keep track of the different types of customers you serve and gives you the information you need
www.palmaxcollege.com 4
to analyse your customer base. You can categorise each customer in a way that is meaningful for your
business.
The customer types do not appear on QuickBooks forms, but you can create reports based on the
information. You can also print mailing labels and summary statements based on customer type.
CREATING ITEMS
If you purchase items ready for resale, keep them in stock, and then sell them, QuickBooks can track the
current number in stock and the value of your stock after every purchase and sale. See "Using Stock part
items".
However, you may not want to track all product sales as Stock items. QuickBooks' Item list has a Non-
stock part type item to track product sales for products you do not want to track as stock. See "Using
Non-stock part items".
Grouping items
If you want to group some items together because these items are frequently sold together, you can use
QuickBooks to track the cost of a group of items. Many product sales businesses find it convenient to
group items.
www.palmaxcollege.com 6
When you set up items, you also designate an income account you want them assigned to. (You'll
typically have many items assigned to the same income account.) You can set up your items all at once or
as you go, as you're filling out an invoice.
CHART OF ACCOUNTS
All accounts in QuickBooks are usually listed in the Chart of Accounts. We make journal entries from
the chart of accounts.
Your Chart of Accounts, including balance sheet, income, and expense accounts, tracks all your
transactions.
POSTING BILL
Choose bills button
Choose the vendor using the drop down arrow
Select the items , type in the cost and the quantity
NB: Always make sure that the stock feature is on before you record bills or post purchase orders. If not,
use the preferences window to turn the stock feature on.
To deposit payments:
1. From the Activities menu, choose Make Deposits.
Important: To make reconciliation with your bank statement easier, do a separate "Make Deposit"
for each payment method such as cash/cheques, Access card, and so on.
2. In the Payments to Deposit window, check all sales paid by one payment method.
3. Click OK.
4. In the Make Deposits window, choose the account you want to deposit the cheque to, for
example, Current.
If this is the cash payment you want to keep on hand instead of depositing, choose the Petty Cash
account you created.
5. Click OK.
HANDLING CUSTOMER RETURNS (RETURN INWARDS)
If you accept returns, you will need to cancel the sales in QuickBooks.
In QuickBooks, you can cancel a sale in three ways:
Void the sale
Delete the sale
Create a credit memo
With all three ways, QuickBooks automatically reduces the appropriate income account and reduces the
VAT account.
www.palmaxcollege.com 8
If you use a credit memo to handle the return, make sure you use the same item as was used on the
original sales receipt or invoice. If the item is taxable, make sure you also include VAT on the credit
memo.
ORDERING FOR SUPPLIES
If you buy and also sell, then when your item quantities reaches reorder level, you will require to ask for
more supplies from your vendors when the item quantities reaches the reorder level.
- We post purchase orders by using the purchase order icon from the menu bar
- The goods received note and the bill usually completes the purchasing procedure.
COST OF GOODS SOLD- Its the account that QuickBooks uses to track your cost for the items
you sell. We choose/ associate this type of account with cost of goods sold account in the chart of
accounts.
QuickBooks usually updates this account by multiplying the item sold by its buying price
This figure will appear in the profit and loss account of the company when computing profits / losses.
The rest of the options are optional e.g preferred vendor e.t.c.
www.palmaxcollege.com 10
CONTRA ENTRY
It is where both the debit entry and the credit entry are shown in the books without affecting an
outsider.
It is the art of transferring money from one account to another e.g. from cash to bank and vice
versa.
There are two ways of posting a contra entry;
- by use of the journal
- use of transfer money
From the activities menu, choose transfer money
Select an account to transfer from and an account to transfer funds to
Enter the amount you want to transfer
Click ok
CREATING BUDGETS
Because consultancies and service businesses can involve large amounts of money, you might want to set
up budgets for your firm as a whole or for a particular client project. By setting up a budget, you can also
get an understanding of the costs you have committed for the financial year.
You can set up budgets that show your projected income and expenses and your projected account
balances. You can then can compare your actual income and expenses or your actual account balances
against your plan by using budget reports.
Here are some guidelines on setting up budgets:
To create a budget by job (instead of month by month), in the Set Up Budgets window, enter the budget
for the entire financial year in the field for the first month of the financial year. Make sure to choose the
job you are using to track the project. If you don't want a breakdown by account, don't choose any
account.
Budgets that extend across two financial years need to have the date adjusted on the report to
cover two years, for example, from 1/1/96 to 1/1/98.
QuickBooks maintains a list of everything that affects the amount on a payroll payment or that is for an
employer expense related to payroll. This list is the Payroll Item list.
QuickBooks automatically provides some payroll items for you. These include payroll items for salary,
two types of hourly wages, national insurance, and income tax. You don't have to worry about adding
these payroll items to the listthey're already there.
To fully track your payroll, you may need to add some more payroll items to the list. You can add payroll
items for employee deductions of any kind; additions (such as bonuses); commissions; and employer-
paid expense (such as employer-paid health insurance).
Adding payroll items
www.palmaxcollege.com 11
Depending on your company's payroll, you may need additional payroll items of the following types:
o Yearly Salary
o Hourly wage
o Deduction
o Addition
o Commission
o Employer contribution
Adding an employee
1 Display the Employee list.
2 Choose New from the Employee menu button.
3 Complete the Address Info tab.
The information you enter in these fields can be exported and used in a form letter.
What the Initials field is used for
Fields to fill in if you are using QuickBooks payroll
4 On the Additional Info tab, enter any information you want to store for this employee.
TRACKING TIME
Time is the most valuable resource for any business, especially in accounting firms, who generally sell
their services based on time taken.
You can track time with QuickBooks by using the Time Tracking feature found under the Activities
menu, or alternatively by clicking on the Time icon.
QuickBooks allows you to enter time in two ways:
PAYROLL EXPENSE ACCOUNT
This account tracks payroll items that are an expense to your company. They include Yearly Salary
Hourly wage Deduction Addition Commission Employer contribution etc
WEEKLY TIMESHEET
What it shows. A weekly timesheet shows the time spent by one person doing any number of activities
for any number of jobs within a seven day period. While the timesheet can only display one week at a
time, you can easily view the hours entered for other weeks.
Why you might use it. If you prefer to enter a person's hours on a single form at regular intervals, this
method might work best for you. For example, a general contractor could use a weekly timesheet to
record the time spent on each job for that week.
When you enter time on the weekly timesheet, you begin by selecting the employee or subcontractor
from the Name list. If the name you want is not listed, you can add it by clicking on the <Add New>
legend. If you are adding a subcontractor, choose the Vendor option.
Next select the Customer:Job that you want the time to be charged to. You must also enter a service item
for the time charged.
Enter time in hours and fractions of hours in the daily columns. Note that the fractions of hours can be
entered either in decimal or in minutes. Go to the General Preferences screen to make your choice. You
can change from one to the other without losing data.
www.palmaxcollege.com 12
When you have finished entering time, click on OK to save.
You can always go back and add or change time. Call up the weekly timesheet you are looking for by
selecting the employee or subcontractor name, and then scroll through the timesheets using the Prev
Week and Next Week buttons.
www.palmaxcollege.com 13
SECTION 4: FINANCIAL REPORTS IN QUICKBOOKS
FINANCIAL REPORTS
These reports show how well your business is doing:
- Profit and loss(STATEMENT OF FINANCIAL PERFORMANCE)
- Balance sheet(STATEMENT OF FINANCIAL POSITION)
- Cash flow forecast
The Accounts Payable column shows the bills you expect to pay, based on the payment terms
you recorded for each vendor. The beginning balance is the amount of past due bills as of the
day before the report start date.
The Bank Accounts column shows expected changes to your bank account balances based on
payments and deposits postdated after the report start date. The beginning balance is the sum
of the balances in all your bank accounts as of the day before the report start date.
The Net Inflows column shows your projected net cash inflow for each week. QuickBooks
calculates net inflow from the amounts in the Accounts Receivable, Accounts Payable, and Bank
Accounts columns.
The Projected Balance is the total in all bank accounts is all unpaid invoices and bills were paid
on time.
To see a list of the transactions that make up an amount, double-click the amount.
To create this report. From the Reports menu, choose Other Reports. Then choose Cash Flow
Forecast.
www.palmaxcollege.com 14
SECTION 5: PREFENCES MENU
About Budgets
Budgets can be created for either Profit and Loss or Balance Sheet accounts, but they
must be account-based.
A budget can be created from scratch, from actual data from the previous financial year, or
from the previous financial year's budget. A budget is uniquely identified by its financial
year, the account type (either Profit and Loss or Balance Sheet) and if desired, further
identified by Customer:Job or Class. Totals from foreign accounts are shown in the home
currency.
www.palmaxcollege.com 15
What these choices mean
5. Click Next.
If you granted access to all areas of QuickBooks, you have no more selections
to make. Click Yes to confirm that you want this person to have full access. Then
click Finish to complete the setup process.
6. If you are selecting the areas the user has access to, make your selections on each
screen that appears. Click Next to go to the next screen.
What the choices mean
7. When the Changing and Deleting Transactions screen appears, respond Yes to the
first question if you want the user to be able to edit and delete transactions in addition
to creating them. Also indicate whether you want the user to have access to
transactions from prior accounting periods.
What your responses mean
8. When the last screen appears, review the table that summarises the access rights
you granted. If you need to make a change, click Prev to return to the appropriate
screen.
9. Click Finish to complete the setup process.
Backing up your data
You must be in single-user mode to do this.
Back up your QuickBooks company files daily. Backup copies are important insuranceif
you should lose data for any reason, you can restore data from your backup copy.
You can choose to back up manually, have QuickBooks back up your data file when you
close it with no prompting from you, or automate your backup routine using the Online
Backup service (for more information, click 'Tell Me More' in the QuickBooks Backup
window), or schedule regular backups to local media.
Which should I choose?
1. If you choose to back up locally, select the storage media on which you will back up
your QuickBooks company. Common choices are 3.5 inch diskette, Zip disk, CD-ROM
or tape.
If you are backing up to a 3.5-inch disk, put the disk in a disk drive.
2. From the File menu, choose Back Up and make sure the Back Up Company File tab
is selected.
3. (Optional) If you want to change the name or location that QuickBooks suggests for
the backup file, enter your changes in the Filename and Location fields. If necessary,
click Browse to browse to the new location.
4. (Optional) Set backup defaults. Click Set Defaults and specify the desired defaults for
your manual backups.
5. (Optional) Select backup options. Click Verify data integrity to verify your data before
backing up. If you've selected to back up to floppy disks, select Format each floppy disk
during backup to format the disks as you back up, instead of before.
If the disk needs to be formatted prior to backup, do not choose Quick Format. Instead,
we recommend that you fully format your disk.
Caution: Even if the disk is labeled as preformatted, it's a good idea to fully format a
new disk before using it. Sometimes new disks can be stripped of their formatting
during shipping.
6. Click OK.
www.palmaxcollege.com 16
If you need more than one disk: QuickBooks asks you to insert an additional disk as each
disk fills up. Be sure to label the disks so that you'll know which one was first, which was
second, and so on. This will help you if you ever need to restore the data from the disks.
About Budgets
Budgets can be created for either Profit and Loss or Balance Sheet accounts, but they
must be account-based.
A budget can be created from scratch, from actual data from the previous financial year, or
from the previous financial year's budget. A budget is uniquely identified by its financial
year, the account type (either Profit and Loss or Balance Sheet) and if desired, further
identified by Customer:Job or Class. Totals from foreign accounts are shown in the home
currency.
Creating a budget
You can create budgets for either Profit and Loss accounts or Balance Sheet accounts by
fiscal year. Foreign account totals are shown in the home currency.
All budgets must be account-based.
1. From the Company menu, choose Planning and Budgeting, then Set Up Budgets.
Note. If a budget currently exists, the most recent budget will be displayed in the Set
Up Budgets window.
How do I modify an existing budget?
2. Click Create New Budget.
3. In the Create New Budget window, choose the fiscal year for the new budget, then
choose Profit and Loss (income and expense) or Balance Sheet accounts.
4. If you choose Profit and Loss, you can specify additional criteria of either
Customer:Job or Class, if class tracking has been turned on.
How do I turn class tracking on?
5. Choose whether you want to create the budget from scratch or from previous year's
actual data.
What's the difference?
6. Click Finish to create the new budget.
Memorising a transaction
Why memorise?
About memorizing
If you have transactions that occur often, such as monthly bills or recurring invoices for
clients, you can save time by memorising the details of the transactions. Once you
memorise a transaction, you can have QuickBooks re-enter it for you at any time. You can
even have QuickBooks automatically enter the transaction at intervals you specify.
www.palmaxcollege.com 17
Restrictions
You cannot memorise the following transactions:
Receipt or deposit of payments
Bill payments
Payroll payments
Time records
VAT payments
YTD payroll adjustments
Creating To Do notes
Remind yourself of tasks you want to complete by a certain date. In the To Do list you can
look at your notes at any time, or you can use the Reminders list to see the notes whose
dates are due.
1. From the Company menu, choose To Do List.
2. Select New from the To Do menu button.
3. Type the note as you want it to appear on the To Do list.
Tip: If you have a lot of detail to put into the note but you want the entry in the To Do
List to be short, enter a short title, press ENTER, and then enter the rest of the note.
Only the title will appear on the To Do list.
4. In the 'Remind me on' field, enter the date you want the note to appear on your
Reminders list.
For example, if you enter 15th May, the note will not appear on the list until 15th May.
5. Click OK.
Depreciation
When you purchase an asset that will be used in your business for more than one year, you
typically spread its cost over the useful life of the asset. But because fixed assets wear out
or become obsolete, their value declines constantly from the day they are purchased. The
amount of this decline in value is called depreciation.
To determine the value of a fixed asset at any point in time, you subtract its accumulated
depreciation from its original cost.
Example
You bought a company car in January 1998 for 13,000.
By January 2000, the car has depreciated by 40% of its original value (5,200).
The value of the car in January 2000 is:
www.palmaxcollege.com 19
Entering a depreciation transaction
Important: Determining the amount of depreciation to deduct, or capital cost allowance
(CCA) can be a complex process, and Kenya Revenue Authority rules on the subject
change often. Ask an accountant for help in figuring actual CCA amounts.
1. From the Lists menu, choose Chart of Accounts.
2. Double-click the subaccount that tracks accumulated depreciation for the asset
you're depreciating.
3. Enter the transaction in the bottom of the register:
Enter the depreciation amount as a decrease in the register.
In the Account field, enter the expense account you set up to track
depreciation.
4. Click Record.
NB:From Premier 2007 edition, we use the journal to write off bad debts
www.palmaxcollege.com 20
BANK ACCOUNTS
Set up and set the preferences for your bank accounts from the chart of accounts
Transferring funds between income and expense accounts and/ or bank accounts
Transfer money between income and expense accounts if you've recently divided an
account into one or more subaccounts, if you're correcting an error, or if you're making an
adjustment.
1. From the Banking menu, choose Make Journal Entry.
2. From the Account column drop-down list, select the income or expense account
that's involved in the transfer.
All income and expense accounts appear toward the bottom of the list.
3. Type the debit or credit amount you want to transfer.
4. Click the Account column below your first entry and select the other income or
expense account that's involved in the transfer.
QuickBooks automatically displays a single balancing amount, but you can split the
transfer among several accounts.
5. Save the transfer.
The End.
www.palmaxcollege.com 21