QUICKBOOKS ONLINE FOR UGA Extension OFFICES

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1 QUICKBOOKS ONLINE FOR UGA Extension OFFICES This document contains step by step instructions for performing QuickBooks Online functions. If you have additional questions or would like to request an addition to the guide, then contact your QuickBooks Administrator. Revised: August 2014

2 Table of Contents Topic Page 1. Make a Deposit 2 2. Write a Check Perform A Bank Reconciliation Adding Parent classes, Sub-Classes, and Sub-Sub Classes Budgeting for Classes Change Funds Change Fund FAQ Credit Card Sales Guide Invoices Merging Classes in QuickBooks NSF Checks Printing Profit and Loss by Class Reports Products and Services List Sales Receipts Transfers between Classes Bank Errors Budget vs. Actuals Report for Classes Duplicates GA 4-H Foundation Investment Accounts Credit Card Charges, Payments, and Reconciliations Recording Asset Donations into QuickBooks (Gift Cards) P a g e

3 Make a Deposit 1. Click the (+) icon from the Home Screen and choose Bank Deposits under the Other category 2. Select the appropriate customer from the drop down menu in the Received From field. 3. Select the appropriate revenue account in the Account field 4. Select the appropriate payment method 5. Type the appropriate amount into the Amount field Write a Check 1. From the Home page click the (+) icon and select Checks under Vendors. 2. Select the to be printed checkbox if printing or uncheck the box and complete the check number. 3. In the Choose a Payee field, type the appropriate recipient. 4. Click the Amount field and type the appropriate amount. 5. Click the arrow in the Account field and select the appropriate expense. 2 P a g e

4 6. If you track classes, then click the class field and select the appropriate class. 7. Click Save. Reconcile a Bank Statement 1. From the Home page click the gear wheel in the top right hand corner and select Reconcile. Select the account to reconcile and click Reconcile Now 2. In the Account field, make sure Checking is selected. 3. In the Statement Date field, type the appropriate statement date. 4. In the Ending Balance field, type the appropriate ending balance. 5. Enter your service charges and select Bank Charges for the expense account. 6. Enter your interest revenue and select Investment Income for the interest account. 7. Click OK 3 P a g e

5 8. In the Checks, Payments and Service Charges section, click to clear the checkmarks for all items that have cleared 9. Repeat the process in the Deposits and Other Credits section click to clear the checkmarks for all items that have cleared. 10. Click Finished 4 P a g e

6 Adding Parent classes, Sub-Classes, and Sub-Sub Classes Classes are what we use to track program related revenues and expenses in a county office. For us, our parent classes are 4-H, ANR, and FACS. Our sub-classes are horse club, camp, SAFE, etc. Our sub-sub classes would be components of the sub-classes. So for horse club, it would be a general fund, horse judging, horse quiz bowl, state horse show, and horse school. For camp, it would be cloverleaf camp, junior camp, senior camp, Marine Resources Camp, Wilderness Challenge camp, and Senior Extreme camp. 1. Access classes, from the home page click the gear wheel at the top right hand corner of the page and select all lists under Lists. 2. Select classes and the following page will appear. 5 P a g e

7 3. To add a parent class, select new, name it and click save. This has already been done in this example. 4. To add a sub-class, select new, name it, and click Is sub-class and select the appropriate parent class, and click save. 5. You will be taken to the following screen. 6. To add what we call a sub-sub class select new, name it, select is Is subclass, and select the appropriate subclass, then click save. 6 P a g e

8 7. You will be taken to the following screen. 8. Note that when you are classing transactions, do not select a parent class if it has sub-classes, or a sub-class if it had sub-sub classes. Always class to the lowest class available. In the example below, you may place funds into the ANR and FACS class, but not into 4-H because it has sub-classes and a sub-sub class. However, within 4-H you may place funds into awards program, but not into camp, since camp has subclasses. This is to ensure proper tracking of funds. 7 P a g e

9 Budgeting for Classes 1. From the home page, click gear wheel on the top right hand corner and click on budgeting under tools. 2. Follow the mini interview that will open up. If it does not open, then click on new budget. 8 P a g e

10 3. Click next. The select No amounts. Create budget from scratch. 4. Select Classes. 5. Select the appropriate fiscal year and name the budget, click finish. 6. The following screen will appear. If your screen looks different, then make sure that the settings are show rows as classes and view by year Then select either 5080 Program Expenses Account for Expenses or 4081 Program Service Revenue for Income. 9 P a g e

11 7. Enter the appropriate budgeted monthly amounts for the first class, then click save & next. Repeat until you have entered amounts for the year, for both the 5080 and 4081 accounts, and for each class. a. Note that at the time of publishing the 5080 and 4081 accounts were the only accounts that the District Directors requested budget amounts for. Additional accounts could be required in the future. 8. Click finish. 9. To compare the budget with actuals, from the Home screen, click on reports 10. Click on all reports then select budget vs. actuals. Change Fund Guide 1. If you do not already have the account, click on the gear wheel icon, under settings select chart of accounts, select new. Under category type select bank, under detail type select cash on hand, rename it change fund, select a chart of accounts number (1050, 2000, etc), select 0 for the opening balance and click finish. 10 P a g e

12 2. To establish opening balances see the FAQ below. 3. To add funds to the change fund write a check from your checking account payable to the person responsible for the money. If it s for the office, then it would be the cash custodian. Under the column labeled account, select the Change Fund account. Add information to the memo as needed. You may use the Quick Add feature to make checks payable to employees or volunteers. Select vendor to track them. 11 P a g e

13 4. To decrease funds from the change fund account, when the money is returned, deposit it to your checking account, under the column labeled account select the Change Fund Account to show the return of funds. Remember checks increase the change fund, and deposits decrease it. This is because you are writing a check from your checking account to the fund, which decreases the checking account and increases the change fund. When you make a deposit, your checking account balance increases, and the change fund will decrease. This is how it will appear in the Change Fund Register: 12 P a g e

14 Change Fund FAQ: 1. I already had $50 in change before this account was created. How do I account for this? a. In most cases, somebody wrote a check out of the county checking account and selected an expense account to record the transaction at that time. To correct and account for this amount, the journal entry below needs to be made. b. You need to debit the change fund for $50, and credit the expense account for $50. The expense account is the account you selected when you first made change for the office. 2. Our office has had $50 change for years and we don t have records of the transaction that create it. How do we account for this? a. In this case, then make a journal entry debiting the change fund account and crediting the retained earnings account for the amount of change you possess. Credit Card Sales Guide Credit Card Sale Recommended Procedures: 13 P a g e

15 1. Take the signed merchant copy from the machine a. Write receipt from the receipt book (optional) 2. Place the signed merchant copy into secured area (such as a locked cash bag or cash box) a. Staple it to the paper receipt book (if followed step 1a) 3. Copy the transaction onto a paper deposit log for credit cards (Appendix A) 4. Run batch report at the end of the day (or first thing the next morning) 5. Attach deposit log to the batch report and store with other deposit records. 6. Gather all signed merchant copies for the day, staple them together, place them in an accordion folder (tabbed by month optional) and store in a safe. The signed merchant copies must be shredded after one year. a. Take signed merchant copies out of receipt book, clip them together, place them in an accordion folder (tabbed by month optional) and store in a safe. (if followed step 1a and 2a) 7. Use the Deposit Function in QuickBooks Online to enter the transactions. 8. When your credit card and bank statements arrive, you will enter your charges and expenses and complete your bank reconciliation. Entering Fees for the Credit Card Machine and Transactions: 14 P a g e

16 1. Locate the Bank Charges and Expenses on your Bank Statement. (This statement matches the QuickBooks picture with the purchased machine) Note that the Bank statement will sum some of the issuer s charges. They separate only the total interchange fees, and sum the rest into the total charge. The credit card statement will break them down into authorization, interchange fees, and service charges. (The last fee was on a separate page and had to be copied separately) 2. Use the Write Check function in QuickBooks to the bank account that the credit card machine is linked to. 3. Use the following accounts to record your expenses: supplies expense and bank charges expense. 4. Select save. Your QuickBooks should now match your bank statement and credit card statement (Pictures below) Example of charges and expenses if you purchased the credit card machine: 15 P a g e

17 Troubleshooting: 1. Credit Card Statement and Bank Statement Transactions do not match: You may need 2 months of credit card statements for every 1 bank statement. This is due to time lags between the credit card issuer, the bank, and your bank account. An example from Elbert County: In the November bank statement there is a $56.00 credit card transaction (11/04) that also appears on the attached October SunTrust statement. However there is a $94.00 credit card transaction (11/08) as well, but it appears on the November SunTrust statement. 16 P a g e

18 Bank Statement (November) Credit Card Statement (October) Credit Card Statement (November) 17 P a g e

19 Credit Card Machine Costs and Fees: Machine Purchase = $400 Machine Rental Fee = $30.00 per month Transaction Fees = estimated at around 6%, but this includes the rental fee and decreases with each swipe. After $500 of transactions each month it goes down much more. The amount is generally negligible and will not increase the cost of doing business. An exact amount of transaction fees is highly variable, but is generally small and will decrease in the long run as more people become aware that UGA Extension Services accepts credit cards. Other Credit Card Machines and PCI compliance: Credit card machines used by UGA must be PCI compliant and adhere to the state wide contracts with the Bursar s office. There are only three approved devices, and the machine currently in use is the most cost effective that satisfies both UGA contracts and PCI compliance. We recommend that you purchase your machine to save money in the long run. 18 P a g e

20 19 P a g e Appendix A:

21 Appendix B: Example of charges and expenses if you are renting the credit card machine: 20 P a g e

22 Invoices You would use the invoice function if you provide a product or a service (soil samples, water samples, etc) but do not receive payment immediately for the product or service. In some cases, local governments may require invoices before they pay for a product or a service. NOTE: All functions under Customers require the use of the product and services list. See guide for details. 1. From the Home page, click the (+) icon at the top of the screen. Under customers select invoice. 2. Fill out the form below with relevant information. You can choose to save and close the invoice to print it later or you can save and send the invoice to the customer s address. 21 P a g e

23 3. When the customer pays the invoice, from the Home page, click Customers tab on the left hand side of the screen. Then select the name of the customer. The following page will open. 4. Click Receive Payment next to the invoice with the open status. The following page will open. Enter the payment method, additional information, and select the Undeposited Funds account. This account tracks all funds that you have received, but not yet deposited. If you do not have an undeposited funds account then create it from the chart of accounts page, select other current assets, and input the information on the following picture: 22 P a g e

24 5. After you have made your deposit at the bank and are ready to enter the deposit into QuickBooks, select the bank deposit function by clicking the (+) at the top of the Home page and selecting it under Other. You invoice will appear as follows: 6. You then select the payments that were in the deposit, and you may add additional deposits in the section titled Add New Deposits. When you have selected all of the transactions on the original bank 23 P a g e

25 deposit, then click save and the funds in undeposited funds account will be moved to your bank account. a. Do not re-enter the payment under new deposits if it is listed above. This will result in unpaid invoices even though payment has been received. Make sure that when payments are made for invoices that you use the make payment function and click on the payments on the deposit screen when you deposit the payment to the bank. Merging Classes in QuickBooks Merging classes is useful if you wish to remove a redundant class and shift all of its classed transactions into another class.this method keeps your records clean and prevents having to re-class the transactions individually. 1. From the home screen, select the gear wheel at the top right hand corner 2. Under Lists select all lists. 3. Select classes. The following page will open. 4. If I had a class called 4-H 2 and I wanted to merge it into 4-H, I would select 4-H 2, click edit, and rename it to 4-H and click save. 24 P a g e

26 5. You will be prompt as to whether you wish to merge the classes. Select yes. 6. Now, all transactions that were classed as 4-H 2 has been given the 4- H class. The 4-H 2 class has been removed and will not appear on any reports in the future. 25 P a g e

27 NSF Check Guide 1. Create the NSF Check account. From the Home screen select the gear wheel, under settings select chart of accounts, click new, click category type and select income, under detail type select Discounts/Refunds Given, name it NSF Checks, select a chart of account number (3050, 4010, etc), and click finish. 2. When an NSF check occurs, if there are bank charges, then record the bank charges using the expense function out of the bank account affected. Under the column account select 5083 Bank Charges, enter the amount under payment and select a class to absorb the loss. 26 P a g e

28 3. NOTE: The next step assumes that you are entering checks timely into QuickBooks Online. If you have not entered the deposit containing the check yet, then do so before continuing. 4. Record the NSF check using the expense function. Write out of the bank account affected and under the column account select NSF checks. Enter the amount of the original check, select a class to absorb the loss, and then click save. 27 P a g e

29 This is how it will appear in your Profit & Loss Report: The NSF Check account will reduce your total income from the check until payment is made. 5. When you collect the funds, then make a deposit to the checking account affected and select the NSF check account on the first line. Fill in the amount of the check. On the second line, select 4070 other income to record the bank charges and/or an inconvenience fee. Then select a class to absorb the revenue. 28 P a g e

30 This is how it will appear in your Profit & Loss Report: When the payment is made, the NSF check account will be reduced. 29 P a g e

31 Printing Profit and Loss by Class Reports 1. From the Home screen click on reports in the left hand column 2. Click All Reports 3. Click on Profit & Loss by Class 4. Click the customize button in the top left hand corner 5. Select the appropriate date range. If you want to know the balance in a program to date, and then select all dates and the number listed under net income will be your balance. 6. Under Lists where it says Class, click the drop down menu and click select multiple. 30 P a g e

32 7. Select a parent class, which is camp in this case, and all of its subclasses Click ok then run report. This will produce a report that is reasonable in size and describes the activity of all of the camp programs to date. You may click to collapse button to make the report more concise. Note that the total 4-H listed below is only the sum of the listed classes. To view the correct total 4-H number you must include the 4-H parent class and all of its sub-classes. 31 P a g e

33 Products and Services List In order to use invoices, sales receipts, or other functions listed under the customers tab, you have to set up a product and services list. You cannot enter transactions directly into accounts like you would using the bank deposit function. Below is a sample Products and Services List: The access the Products and Services list, from the Home page, click the gear wheel in the top right hand corner and select Products and Services. 32 P a g e

34 When you add a product or a service, you must select the account that it is tied to. Pricing information is optional and can be added manually to each invoice, sales receipt, etc. Sales Receipts A sales receipt is used when a customer pays you at the time of sale. The use of the function is optional in an Extension Office at the time of writing. 1. When a customer pays you, you would immediately make a sales receipt by clicking on the (+) at the top off the page from the Home screen. 33 P a g e

35 2. Fill out the fields below and select for funds to be deposited into the undeposited funds account. This account will track all current outstanding cash receipts until they are deposited into the bank. 3. To review sales receipts for an individual customer, like on the customer tab on the left hand side of the screen and select the name of the customer. A screen showing all past receipts and invoices will appear. Since payment is received at the point of sales, all sales receipts will be marked as paid. 4. After you deposit the funds at the bank, click the (+) at the top of the Home page and select bank deposit under the Other category. You will then be able to select the sales receipts to be entered into 34 P a g e

36 35 P a g e your deposit. The funds will then be transferred from the undeposited funds account to your bank account. You may make additional deposits by entering information under the Add New Deposits section.

37 Transfers between Classes 1. From the home screen, click the (+) icon and select journal entry under Other Select the appropriate account. In transferring between classes, the account must be the same with the classes being different. In the following case, we want to decrease FACS and ANR to increase 4-H. Note: Since we selected a revenue account, we need to debit FACS and ANR to decrease them and credit 4-H to increase it. If you selected an expense account, debits would increase the balance and credits would decrease it. 36 P a g e

38 4. The following pictures show how the journal entry affects the profit & loss by class report. 37 P a g e

39 Bank Errors Bank errors are when a bank makes an unintentional error regarding one or more aspects of your bank statement. Because of the variety of possible bank errors, the following steps are meant to only prepare you for the correction. In order to make the final correction in your QuickBooks Online company file, contact your QuickBooks Administrator for assistance. Perform the following steps: 1. Do not adjust anything in QuickBooks Online. 2. Call the bank and ask for them to correct the error on their books 3. If the bank will not correct the error, then call your QuickBooks Administrator. If they will correct the error, then proceed to step If the bank will correct the error, then determine the amount of the correction and on which bank statement the error will be corrected. 5. Contact your QuickBooks Administrator walk you through the correction process. 38 P a g e

40 Budget vs. Actuals Report for Classes 1. Click on Reports, then Business Overview, and at the bottom left hand corner select Budget vs. Actuals. 2. If you have multiple budgets, then you will be automatically be prompt to customize the report. If not then select customize. 3. Select the appropriate budget and time period 4. Under rows/columns select accounts vs. classes. 5. Then de-select $ over budget and % of budget. This will make your reports cleaner. 6. Then click run report. Your report for the next fiscal year should look similar to the picture below. Do not be alarmed if the current actual amounts are zero. This budget is for the next fiscal year, so no transactions have affected the accounts yet. 39 P a g e

41 7. To print the report select print at the top left hand corner of the screen. Since these reports tend to be horizontal in length, I recommend selecting landscape to fit more classes on one page. Duplicates If you enter a duplicate transaction, then you should either void it if it s a check or reduce the amount to zero if it s a deposit and clear it at your next reconciliation. Below is an example of a duplicate deposit. 40 P a g e

42 The deposit is entered for $10; however, there is another deposit already entered for the same transactions. The transaction amount is edited to $0 and it will be cleared at the next reconciliation. Note that QuickBooks Online will not let you save the transaction unless the received from box and an account are selected. GA 4-H Foundation Investment Accounts If you are moving money from a separate investment vehicle to the GA 4-H Foundation, then perform the following steps in QuickBooks Online: 1. Transfer funds from the investment (CD, Money Market, etc) to your County Extension Checking Account. 41 P a g e

43 2. Write a check to the GA 4-H Foundation from your checking account. Make sure to select the retained earning account under the account column. 3. Set up the following two accounts in QuickBooks Online: Account #1 GA 4-H Foundation Investment Account From the Home screen, click the gear wheel in the top right hand corner, and click on chart of accounts, click new, then select Category Types, then select "other Current Assets," and then "Investment Other." Give it the appropriate name, and then give it an account number such as #2000 and set the opening balance to $ P a g e

44 Do a journal entry to establish the opening balance. Doing a journal entry verses putting in an opening balance keeps from adding the amount to opening balance equity. You will debit the investment Account and then Credit the account where you transferred the funds (such as checking). You do not need to enter a class for this entry. Account #2 Unrealized Gains/Losses From the Home screen, click the gear wheel in the top right hand corner, and click on chart of account, click new, then select Category Types, then select "Equity," and then "Accumulative Adjustments." Name it unrealized gains/losses, and then give it an account number such as #3100 and the opening balance would be $0 43 P a g e

45 To make adjustments: If the investment account grows, I would do a journal entry debiting the GA 4H Foundation Account and crediting the Unrealized Gains/Losses. If the investment account loses, I would do a Journal entry debiting the Unrealized Gains/Losses and crediting the GA 4H Foundation Account. If you redeem your investments from the GA 4H Foundation Account, then contact your QuickBooks Administrator to walk you through the appropriate entry. *Gains and losses on an investment account do not affect income until you move money out of the investment account. Credit Card Charges, Payments, and Reconciliations If you wish to track your credit card charges and payments in QuickBooks Online, the following guide has been prepared. At the time of writing this is not required reporting, but a best practice for monitoring credit card accounts. 44 P a g e

46 1. Set up the Credit Card Account From the Home screen, click on the gear wheel on the top right hand corner of the screen, under settings select chart of accounts, click new, then under category type select credit card, then name the credit card, assign a chart of accounts number (1200, 1300, etc), then click save. 2. Enter Charges To enter credit card charges, you will use the expense function. From the Home screen click the (+) sign at the top of the screen, and under vendors select expense. Fill out the necessary information detailed in the picture below and select save. As you enter charges, they will be recorded on the credit card register which functions similar to your bank account register. However, note that expenses increase the account, and check payments will decrease it. 45 P a g e

47 3. Enter Payments To enter payments, you will use the write check function. Select the bank account at the top of the screen and instead of selecting an expense account you will select the credit card account. NOTE: Do not select a class for this transaction. 4. Reconciliation 46 P a g e To reconcile, from the Home screen click on the gear wheel on the top right hand corner of the screen, under tools select reconcile.

48 Select the credit card account from the drop down menu and click reconcile now. The following screen will appear: Enter your statement ending date, ending balance, and finance charges. I recommend using the 5083 Bank Charges account to record any finance charges. Click ok and the following screen will appear: You will then reconcile the QuickBooks Online balance to your statement balance. When the difference is 0, then select finish now. The following report will be generated: 47 P a g e

49 Recording Asset Donations into QuickBooks (Gift Cards) In this situation, a local business donates a gift card to its store to the Extension office. The amount is quantifiable and needs to be reported to the IRS as part of your donations, contributions, and grants. To record receiving the gift card, use the bank deposit function and deposit it into an other current asset account such as Uncategorized Assets. 48 P a g e

50 When you use the gift card, you will do a journal entry to record the expense and reduce the amount in the uncategorized asset account. 49 P a g e

51 50 P a g e