How to Run a Time Comparison Report in Quickbooks

Want to compare financial metrics of your business from multiple time periods? Using Quickbooks, you can easily do this by running a time comparison report. Maybe you want to see how your business fared from Q1 to Q2 of last year, or perhaps you want to see how your business performed during the holidays compared to the rest of the year. Regardless, Intuit’s popular Quickbooks accounting software makes this task a breeze. Using the software, you can run a time comparison report to view side-by-side financial metrics from different time periods.

Steps to Run a Time Comparison Report

To run a time comparison report, log in to your Quickbooks account and access “Reports” from the left-side menu. From here, choose “Transaction List by Date,” at which point you can specify the time period for which you’d like the first report to reflect. After setting the time period for the first report, you can then filter the report by elements such as as credit card expense, credit card credit, vendor credit, check, bill payment check, cash expense, etc. When finished, click “Run Report” to run your first report.

Assuming you follow the steps listed above, you should see a report for your specified criteria. You can compare this report to a second report, however, by performing just a few additional steps. Look at the top of the first report and you’ll see a menu titled “Compare another period,” which you can click to run a second report.

Quickbooks will prompt you to enter a time period for your second report, which may include the previous period, previous year or year to date. Previous period, of course, refers to the time period immediately before the report period. If the report period is December, for example, the previous period is November. Previous year refers to the last year, whereas year to date includes transactions from the beginning of the year to the beginning of the report period.

In addition to specifying the time period of the second report, you must choose how you want Quickbooks to compare the difference between the two reports. After entering this information, click “Run Report” to run the second compare, which you can compare to the first report. You can repeat these steps to compare other reports in your business’s Quickbooks account.

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Guide to The Weighted Average Cost (WAC) Accounting Method

Weighted average cost (WAC) is an accounting practice used extensively by retailers, e-commerce companies and other businesses that sell physical products. Used by business business-to-consumer (B2C) and business-to-business (B2B) companies, it provides a better understanding of a business’s cost of goods available and its inventory. To learn more about the WAC accounting method and how it’s performed

Calculating WAC: What You Should Know

To calculate WAC for your business, you must take your cost of goods available and divide it by the number of units available. This number will reflect the WAC for each of those available units. Still confused? Here’s an example: If your cost of goods available is $50,000 and you have 5,000 units of that product available, the WAC per unit of that product is $10.

Benefits of Using the WAC Accounting Method

There are several benefits to using the WAC accounting method, one of which is simplicity. From an outsider’s perspective, calculating WAC may seem like a tedious and difficult process, but it’s actually quite easy. The only numbers required to calculate WAC are the cost of goods available and the number of units available. Once you’ve identified those two numbers, you can calculate the WAC for the product.

Using the WAC accounting method can also help you understand how much it costs to produce a product, per unit. When a business handles hundreds or thousands of orders per day, it may struggle to keep track of costs. This is where the WAC is helpful, however. This accounting method attaches a per-unit cost to the product, allowing businesses to see how much they spend to product or acquire a product that they sell.

Cost of Goods Available Isn’t the Same as COGS

It’s important to note that cost of goods available is not the same as cost of goods sold. The cost of goods sold (COGS) refers to the value of the product’s sales. In comparison, cost of goods available refers to the value of inventory in addition to the cost of goods purchased.

Hopefully, you have a better understanding of the WAC accounting method after reading this. To recap, this method is used to calculate the “weighted average cost” of a specific product. It’s performed by taking the cost of goods available and dividing it by the number of units available, resulting in the product’s WAC.

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What Is Advanced Inventory in Quickbooks?

When using Quickbooks to keep track of your business’s finances, you may come across a feature called “advanced inventory.” Available in Quickbooks Desktop Enterprise, this feature lives up to its namesake by providing greater insight and control into your business’s inventory. To learn more about advanced inventory and how to use this feature, keep reading.

Advanced Inventory Features: What You Should Know

Advanced inventory brings a plethora of new inventory management features to Quickbooks. The “Enhanced Pick, Pack and Ship” feature, for example, creates a centralized dashboard from which you can manage your business’s workflow. Using this dashboard, you can send items to a packaging center, print shipping labels and more. It’s just one of many features that makes advanced inventory a powerful tool for businesses.

In addition to “Enhanced Pick, Pack and Ship,” advanced inventory also features a tool that automatically tracks inventory in your warehouse. Known as “Cycle Count,” it works by reading inventory count sheets that you upload to Quickbooks. Once uploaded, you can review the count sheets for erroneous data or discrepancies.

Furthermore, advanced inventory allows you to scan barcodes of inventory items when you receive them at your business’s warehouse. Just scan the barcode, at which point it will be added to your Quickbooks account as an inventory item.

Advanced inventory even offers customizable reports that you can use to analyze key performance metrics (KPIs). Specifically, there are three different types of reports that you can run, including a Valuation Summary report, Inventory Stock by Item report and Assembly Shortage report.

Finally, advanced inventory makes it easy to track the movement of your business’s products. You can track products by serial number, lot numbers or even bin location. By tracking your products, you’ll have a better understanding of how and when they reach your customers. And you can use this information to optimize your businesss’s approach to achieve higher profits.

How to Enable Advanced Inventory

Assuming you have Quickbooks Desktop Enterprise, you can enable advanced inventory in just a few easy steps. After logging in to your Quickbooks account, click the “Edit” menu at the top of the screen, followed by “Preferences.” From here, click “Items & Inventory,” followed by “Company Preferences.” You can then click the “Inventory and Purchase Orders are Active” box, which will place a check mark in the box, confirming that the feature is now enabled and active.

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How to Record Owner Contributions in Quickbooks

It’s not uncommon for business owners to invest their some of their own personal money in their business. Known as an owner contribution, it can help entrepreneurs get their new business up and running. Using this money, they can purchase equipment, advertising, inventory and more, all of which allows entrepreneurs to run their business. But if you’re planning to invest your own money in your business, you’ll need to record it as an owner contribution in Quickbooks.

Steps to Recording an Owner Contribution in Quickbooks

To record an owner contribution in Quickbooks, launch the Quickbooks program and click the “Banking” tab at the top of the home screen. From here, choose “Make Deposits” and then select the bank account where you’d like to deposit your personal investment. If you don’t see your preferred bank account listed, you’ll need to add it. This is done by accessing your “Chart of Accounts,” from which you can add new bank accounts.

With the bank account added, you should now be able to select it from the “Make Deposits” screen. After clicking your preferred bank account, go ahead and add a note, such as your name and “owner contribution,” in the “Detail” section. You can then enter the amount of money that you wish to invest in your business in the “Amount” field. When finished, click the “From” menu and proceed to choose your owner equity account. To finalize the process, click “Save and Close.” To record additional owner contributions, simply repeat these steps.

Owner Contribution vs Loan: What You Should Know

Some business owners assume that an owner contribution is the same as a loan, but this isn’t necessarily true. While they both involve a business owner investing money into his or her business, they are two unique forms of owner-initiated funding. The fundamental difference between an owner contribution and a loan is that the former doesn’t require repaying, whereas the latter does require repaying. If you make an owner contribution to your business, you don’t have to repay that money back to yourself from your business.

There are also owner draws, which as the name suggests is the opposite of an owner contribution. This involves pulling money from a business’s financial account and transferring it into the business owner’s personal account. Owner draws result in less owner capital and equity.

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What Is Debt Ratio in Accounting?

Debt ratio is a frequently overlooked financial metric. When running a business, you’ll probably focus on your net revenue simply because this reveals the total amount of profits your business earns in a given period. While important, however, there are other financial metrics you should track, including debt ratio. So, what is debt ratio in accounting, and how do you calculate your business’s debt ratio?

Debt Ratio Explained

Debt ratio refers to the difference between your business’s total liabilities and its total debt. To calculate debt ratio, take your business’s total liabilities and divide it by its total assets, at which point you’ll have your business’s debt ratio.

Here’s an example of how to calculate debt ratio: Let’s say your business has $500,000 in total assets and $250,000 in total liabilities. Take $250,000 and divide it by $500,000. This equals a debt ratio of 0.5. Any debt ratio below 1 is good because it means that your business’s total assets are greater than its total liabilities. If your business’s debt ratio is higher than 1, it means the cost of your liabilities is greater than the value of your assets.

Assets vs Liabilities:

To calculate debt ratio, you’ll need to add up all your business’s assets as well as its liabilities. Assets, of course, are something of value that provides economic benefit for your business. In comparison, liabilities include debt that your business is required to pay.

Assets may include your business’s cash, equipment, vehicles, office furniture and stock shares. Liabilities may include accounts payable, salaries payable, interest payable, income taxes payable and customer deposits. For effective debt ratio tracking, you must calculate all your business’s liabilities and divide it by all your business’s assets.

The Importance of Tracking Debt Ratio

Tracking your business’s debt ratio is important for several reasons. For starters, it provides a better understanding of your business’s cash flow. A high debt ratio will restrict your business’s cash flow, which could hinder your operations and prevent your business from growing and expanding into new markets. Your business’s debt ratio can also affect its a eligibility for funding. If you are seeking a loan to fund your business, lenders may scrutinize your debt ratio to determine if you are a suitable candidate. While private lenders are always an option, many banks will reject your application for a loan if your business has a high debt ratio.

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Quickbooks Audit Log: Everything You Need to Know

When using Quickbooks to track your business’s finances, you’ll probably add and edit entries on a regular basis. Even if you don’t have any employees or freelance contractors, you’ll still have to create an entry for every sale your business makes as well as every expense. The good news is that you can look back to see these changes using the software’s Audit Log feature.

What Is the Audit Log?

The Audit Log is a feature in Quickbooks that contains a record of all changes made to your Quickbooks company file. Specifically, it allows you to see what changes were made, when those changes were made, and who made the changes. If you discover an erroneous entry in your Quickbooks company file, for example, you can use the audit log to see when it was added and who made it.

The purpose of the Audit Log is to provide business owners and accountants with greater insight into their accounting activities. Maybe another worker has access to your Quickbooks account. If so, there’s a possibility that he or she made an erroneous entry. Using the Audit Log, you can see exactly who made the erroneous entry.

How to View the Audit Log

To view the Audit Log, log in to your Quickbooks account and click the gear icon at the top of the page. Next, select “Audit Log” under the “Tools” tab. From here, click “Filter” to select your desired criteria, such as “User,” “Date” or “Events.” When finished, click “Apply,” after which Quickbooks will display all changes that meet your filter criteria.

Keep in mind that Quickbooks will only display a maximum of 150 entries in the Audit Log. To see more changed entries, click the “Next” button at the bottom of the screen.

User Types Displayed in Audit Log

The Audit Log may display certain types of users. Supper representatives, for example, refer to official Quickbooks supper representatives who make changes to a business’s company file on behalf of the business. System administration users, on the other hand, aren’t real users at all. Entries listed as “system administration” are made automatically by Quickbooks

Learning how to use the Audit Log can help your business avoid accounting problems. This nifty feature reveals all changed entries in your company file, including the type of change, when the change was made and who made the change

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Secured vs Unsecured Business Loans: What’s the Difference?

When seeking funding for your business, you’ll probably come across business loans. Offered by both government-backed banks and private lenders alike, business loans are among the most common type of funding vehicle used by businesses. You can get loans as small as $5,000 or as big as $500,000 — sometimes even larger. Not all business loans are the same, however, and it’s important to consider whether it’s secured or unsecured.

Unsecured Business Loans

An unsecured business loan is money loaned to a business that doesn’t require the business to use collateral. When you apply for an unsecured business loan, the lender will run a credit report to see if there are late payments or other delinquencies. Additionally, the lender may evaluate your business plan to further gauge your ability to pay back the loan. If you meet the necessary criteria, the lender will approve your application and give you the business loan.

Secured Business Loans

A secured business loan, on the other hand, is money loaned to a business that does require the business to use collateral. Some lenders are skeptical of loaning money to businesses, especially if those businesses have bad credit or no credit. Rather than rejecting their application for a loan altogether, lenders may require the use of collateral to secure the loan. Collateral is essentially something of value that the lender can use as a financial recourse in case the business is unable to pay back the loan. Common examples of collateral include real property, business equipment or even accounts receivables.

Which Should I Choose?

Now that you know the difference between unsecured and secured business loans, you might be wondering which funding vehicle is right for your business. There are advantages and disadvantages to both types of business loans. Unsecured loans don’t require the use of collateral, so you don’t have to worry about losing those assets if you fail to pay back the loan. On the other hand, unsecured loans are more difficult to obtain because they have a higher risk for lenders.

Secured loans are easier to obtain, and in many cases, they are the only option available for new businesses that are just getting off the ground. The problem with secured loans, however, is that you may lose any assets used as collateral if you don’t pay back the loan.

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How to Print Chart of Accounts in Quickbooks

A chart of accounts is one of the most important documents in business accounting. Featuring a chart-based layout with columns and rows, it reveals your business’s expenses, revenue, assets and liabilities. While you can always create a chart of accounts manually using pen and paper, Quickbooks simplifies the process by automatically creating them using entries. So, how do you print a chart of accounts using Quickbooks?

Steps to Printing a Chart of Account

To print a chart of accounts in Quickbooks, log in to your Quickbooks account and click the gear icon in the upper-right corner, followed by Settings > Chart of Accounts. This will display your chart of accounts as prepared by Quickbooks. To print the chart of accounts, simply click the box in the upper-right corner of the page titled “PRINT.”

If Quickbooks fails to print your chart of accounts, check your printer settings to ensure they are correct. Quickbooks will automatically attempt to print your chart of accounts using your default printer. If you recently changed printers but still have your old, unconnected printer set as default, it may not print. Therefore, you should inspect the printer settings on your computer or device to see which printer is set as default. And if you don’t see your new printer listed, you may need to install the new drivers (software) for it.

There’s also the possibility that your printer is out of paper. If you don’t hear your printer printing after clicking the “PRINT” button in Quickbooks, look inside your printer’s paper tray to see if it’s empty. Without paper, it won’t print your chart of accounts or any other document

How to Edit an Account Number in Your Chart of Account

After printing a chart of accounts, you may discover that one or more account numbers are wrong. You can easily fix incorrect account numbers, however, in just a few easy steps.

To edit an account number in your chart of accounts, go to the “Lists” menu and choose “Chart of Accounts.” Next, right-click the account containing the wrong account number and select “Edit Account.” Once clicked, you can edit the account number and make other changes to it. Just remember to click “Save & Close” when you are finished to complete the process. Otherwise, Quickbooks won’t save your changes, retaining the old account number instead.

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Shrink Your Company File Using the Condense Data Tool

Want to shrink the size of your company file in Quickbooks? When using the desktop version of Intuit’s popular business accounting software, you’ll have a single file that contains all your business’s financial transactions and records. Known as a company file, it’s the single most important file for accounting purposes. Over time, however, your Quickbooks company file will grow larger, thereby consuming more space on your computer or device. If your company file grows too large, it may cause performance issues like slow loading times and random freezing. But the good news is that you can shrink your company file using the condense data tool.

What Is the Condense Data Tool?

Available Quickbooks Desktop, the condense data tool is a feature that automatically converts closed transactions into journal entries, as well as eliminating unnecessary data, from your company file.

With the release of Quickbooks 2019, Intuit has introduced a new version of the condense data tool. Like earlier versions, it also shrinks the size of company files. The condense data tool in Quickbooks 2019, however, performs this job without deleting or otherwise removing any of your data. The end result is a smaller company file that’s less likely to cause performance issues when using Quickbooks.

How to Use the Condense Data Tool

To use shrink your company file using the condense data tool, log in to your Quickbooks account and access File > Utilities > Condense Data. You will then see one of two options. The first option allows you to retain all transactions in your company file while removing audit trail data. The second option allows you to remove transactions that you specify from your company. Each option will provide an estimation of how much smaller the condense data tool will reduce your company file, such as 30% or 40%.

After choosing your preferred option, click the “Next” button. The condense data tool will then display a notification stating “Working on your file now.” Depending on the current size of your company file, this may take anywhere from a few seconds to several minutes. Once finished, a new window will pop up that tells you how much smaller your company file is.

Keep in mind that there’s no way to reverse the changes from using the condense data tool. After running the tool, your company file will be forever changed. Therefore, it’s a good idea to back up your company file before running the tool.

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Accrual vs Cash Basis Accounting: What’s the Difference?

Accounting is an essential step to running a business. Regardless of industry, all businesses need to keep track of their expenses and revenue so that they can optimize their operations for higher profits and pay the correct amount of taxes. But there are different types of accounting from which business owners can choose, the two most common of which include accrual and cash basis.

How Cash Basis Accounting Works

With cash basis accounting, a business records revenue from the sale of a service or product when it receives payment from the customer. Whether the customer pays using cash, credit card, debit card or check, the business doesn’t record the payment as revenue until it has received the funds from the customer. Some basis exclusively use cash basis accounting. Retail stores, for example, typically use this method because they exchange products for money at the same time.

Cash basis accounting offers certain benefits, such as simplicity. It’s easy for businesses to record revenue when they receive payment from the customer. Furthermore, there’s no need to worry about accounts receivables affecting a business’s books. With cash basis accounting, accounts receivables — unpaid invoices — aren’t recorded as revenue.

How Accrual Accounting Works

Accrual accounting takes a different approach. Rather than recording revenue when a business receives payment from a customer, accrual accounting requires businesses to record revenue when a customer makes a purchase. This may sound confusing, but think of it like this: Purchasing and paying for a product or service are two separate things. You can purchase dinner at a restaurant, for example, and you won’t be required to pay for it until after your meal.

Many businesses allow customers to pay for their products or services after purchasing them. With accrual accounting, businesses record revenue when a customer makes a purchase. Customers may pay for their product or service when they initially purchase them. In other cases, customers may wait and pay at a later date, assuming it’s allowed by the business. Accrual accounting ignores the reception of payment from a customer. Instead, it revolves around recording revenue when a customer purchases or orders a product or service

Accrual accounting is the preferred method among business owners, primarily because it views accounts receivables as assets — which they are. On the other hand, however, it isn’t an effective accounting method for measuring a business’s cash flow.

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