QuickBooks Payroll

Most people shy away from payroll and outsource it.

In my opinion, this is costly and for some companies this is acceptable. However, in today’s economy where the accountant or bookkeeper can save the company money is in payroll.

Intuit has a few levels of payroll service. I have been subscribing to the enhanced payroll service with no issues whatsoever.

The most difficult area of payroll is setting it up: The Federal portion has a few accounts and are the easiest to set up. However, depending on which State of the Union you happen to be that is the most problematic, but not insurmontable.

I have two states that, in my opinion, are the worst. New York and New Jersey.
If you are interested in setting up payroll in Quickbooks; you need to response to my blog.

QuickBooks Receipts and Paypal fees

When one receives a payment for a service, product, etc. there is no need to create an invoice.

Instead create a Sales Receipt.

In the Home page click “Create Sales Receipt.”

From top menu Customers –> Enter Sales Receipts.

Drop down customer or create customer from “Add New.”

Choose the item or service, include check number (if paid by check) and payment method.
If this is paid by cash, be sure the “Deposit to” is available to change the deposit for Cash on Hand.

If it is paid via paypal then Paypal bank account needs to be set up. Later funds can be transferred from the Paypal Account to the Bank Checking Account.

PayPal Fees: Add an Item for Paypal fees to apply to an expense account and not to an income account.

In the Qty colum put a negative before the number of fees.  A warning will pop reminding that the transaction is associated with an expense account: In this case that is precisely what one wants; ignore warning. Click OK.

 

QB chart of accounts

QB allows to edit the flexible chart of accounts. Does not matter which company chart of accounts was used to create the company.

Keyboard shortcut Ctrl/ A or Menu Accountant –> Chart of Accounts, or HOME page choose the chart of accounts.

The chart of accounts follows the A = L + E formula.

Chart of accounts should have account numbers; however if there are subaccounts, I find that it is best to leave the chart numbers out of the subaccounts and place them alphabetically under the master account number:

Ex.

8522 Chevrolet IXPN truck expenses
       gas
       parking
       registration
       tolls

Instead of:

8522 Chevrolet IXPN truck expenses
     8522.01 gas
     8522.05 parking
     8522.11 registration
     8522.15 tolls

Too many numbers.

Try to keep the chart of accounts as simple as possible and be sure to follow accrual accounting procedures for prepaid insurance, and any prepayments that may be depleted month to month.

Why: because if one posts the full amount of an insurance payment for, lets say six months of June, the month of June will have an unusual expense spike for expenses that have yet incurred; therefore apply the appropriate accounting rules for prepayments.

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