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Monthly Archives: September 2009

How to Book EE Series Bonds in QuickBooks

I would like to know if my business is able to purchase EE series bonds.  If so, should they be made out under the company name or my personnel name.  I am an employee of my business.  If my business is able to purchase the bonds how do I set up an account on the chart of accounts.  Would it be considered an asset, expense, etc.???  Thank you in advance for your help.
EE series bonds are a little tricky because they’re not worth their full face value until they reach maturity.  For instance, let’s say you purchase a $50 bond for $25.  At that point, the bond is only worth $25.  It won’t be worth $50 for another 30 years.  Each month the value of the bond inches up a bit, getting a little closer to the $50 it will be worth at maturity.This is the tricky part.  You really should accrue the interest as it’s earned.  Luckily, there’s a nifty little calculator that will tell you what your bond is worth at Treasury Direct.  Just remember, you still need to manually enter the increase in value in QuickBooks.

You would set the account up as a “other asset” account unless you expect to redeem them in less than a year, which is unlikely.  But if this is the case, you’d choose “current asset” instead.

When you purchase the bond, just write a check using your new Savings Bonds account as the account.  This is effectively a transfer from one kind of asset (cash) to another (savings bonds).  It’s not an expense.


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This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.

Ruth Perryman - QuickBooks Specialist Written by +Ruth Perryman

Ruth is the an Intuit Premier Reseller that offers great deals on QuickBooks POS and QuickBooks Enterprise. She has provided expert QuickBooks help to thousands of businesses all over the world since 1996.

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How to Book Customer Deposit Refunds in QuickBooks

Hope you can help me.  A client gave me money on account which I deposited.  After invoicing him he was due a refund. I wrote a check out to him and in the account field I assigned it A/R.  When I go into my chart of accounts in the A/R the amount I refunded is added .  Why is this?  If I gave a refund shouldn't the A/R balance be less?   I used the help tab in my QuickBooks and that is what it told me to do.
It depends on how you booked the original money on account you deposited.  You need to book the refund to the same account you used for the original deposit.  I’m guessing it was probably a revenue account instead of A/R since the deposit would’ve caused a negative A/R balance.

When you write a check to a customer and use A/R as the account, QuickBooks thinks you just made a loan that should be repaid and this increases A/R.  If you had posted the original deposit to A/R, there would’ve been a negative balance equal to the amount of the refund so the refund would’ve brought the account back up to $0.

Assume the deposit was $1000 but you only did $800 in work.  Your transactions probably looked like this:

$1000 Deposit:
Increased cash $1000
Increased revenue $1000

$800 Invoice:
Increased revenue $800
Increased A/R $800

$200 Refund Check:
Increased A/R $200
Decreased cash $200

In the above scenario, both revenue and A/R are overstated by $1000.  Not only that, but this isn’t really the proper way to handle customer deposits because you’re booking $1000 in revenue before you’ve actually earned it and as you learned you sometimes have to refund some (or all) of the customer deposit.  This is how they should be booked:

  1. Go to Lists > Chart of Accounts, click on the Account button, select New, and add a current liability account called "Customer Deposits".
  2. Go to Lists > Item List, click on the Item button, select New, and add an other charge item called "Customer Deposits" mapped to the Customer Deposit account you setup above.
  3. Create an invoice or sales receipt using the Customer Deposit item you created above, and receive payment as usual.
  4. On the final invoice, invoice for the full amount of the contract and add a line using the Customer Deposit item using a negative amount for the deposit already received. The total on the invoice should show the remaining amount due.
  5. Periodically go to Banking > Reconcile and reconcile the Customer Deposit account so that the customer deposits that have been applied to invoices are marked as cleared.
  6. Then you can filter a report to only show uncleared transactions to get a report of only customer deposits that haven't been applied yet.

In this case, if you owe your customer a refund you’d use the customer deposit account which should still have a balance equal to the amount that should be refunded because it hasn’t been invoiced yet.

The transactions would look like this:

$1000 Deposit:
Increase cash $1000
Increase customer deposits $1000

$800 Invoice:
Increase revenue $800
Decrease customer deposits $800 (leaving a balance of $200)

$200 Refund Check:
Decrease customer deposits $200 (bringing the balance to $0)
Decrease cash $200


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This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.

Ruth Perryman - QuickBooks Specialist Written by +Ruth Perryman

Ruth is the an Intuit Premier Reseller that offers great deals on QuickBooks POS and QuickBooks Enterprise. She has provided expert QuickBooks help to thousands of businesses all over the world since 1996.

Visit our webstore for great deals on QuickBooks and QuickBooks POS!

How to Handle Bounced Checks Without Affecting your Sales Reports in QuickBooks

Nobody loves QuickBooks as much as we do, but sometimes the instructions found in QuickBooks Help aren't really the best way to handle a tricky transaction.  A good example is that the instructions for how to Handle a bounced check from customer (NSF check) results in duplicate sales on the Sales by Customer reports.  Even worse if you happen to have a sales rep assigned to the customer and didn't remove it when you re-invoiced, the bounced check it results in duplicate sales on the Sales by Rep reports. 

Here are the instructions for how to handle a bounced check in QuickBooks without affecting your sales reports:

  1. Go to Lists > Chart of Accounts and create a new bank account called "Clearing account". 
  2. Go to Lists > Item List and create a new Other Charge item called Bounced Check mapped to the clearing account you created above.  Create another Other Charge item called Bounced Check Fees mapped to your bank service fee account.   
  3. Go to Customers > Credit Memo/Refund.  If you have sales reps, modify the credit memo to include the sales rep box by clicking on the Customize button and checking the Screen box next to Sales Rep.  Use the bounced check item you created above and enter the amount of the returned check.  The sales rep box doesn’t automatically populate so if you have sales reps make sure to enter the rep, otherwise your Sales by Rep report will be overstated. 
  4. After you save the credit memo, you’ll be given a list of options.  Select Give a Refund.  Unclick the box next to To be printed, enter the date the check was returned, enter EFT for the check #, and enter something like “check returned NSF” for the Memo. 
  5. Go to Customers > Create Invoice and re-invoice the customer.  Use the bounced check item you created above and enter the amount of the returned check.  The sales rep box should automatically populate.  If it doesn’t, enter the rep.  Use the bounced check fee item you created above to pass on any returned check fees your bank charged you.


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This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.

Ruth Perryman - QuickBooks Specialist Written by +Ruth Perryman

Ruth is the an Intuit Premier Reseller that offers great deals on QuickBooks POS and QuickBooks Enterprise. She has provided expert QuickBooks help to thousands of businesses all over the world since 1996.

Visit our webstore for great deals on QuickBooks and QuickBooks POS!

How to Pay a Bill with an EFT Payment in QuickBooks

Brandon was very helpful during his visit awhile back. I have a question on entering a transaction and possible shortcut I think he showed me.  (Probably in the banking tab that I seem to keep ignoring since those icons are so inviting.)   Okay, I have entered a transaction under Enter Bills and want to pay it as an EFT (technically it has already been paid), since my program only gives me check or credit card choices what's the best way to record this payment?   It is a reoccurring transaction but I prefer to enter the transactions as they occur.
If you’ve entered the bill already, make sure to use Vendors > Pay Bills.  

1. Check the bill(s) you paid.  

2. If you paid the bill with your checking account was used, choose “Check”, select “Assign check number”, select the correct checking account (if you have more than one), and click Pay Selected Bills.  In the Assign Check Number screen enter EFT as the check #.  

3.  If you paid the bill with your credit card, choose "Credit Card", and select the correct credit card account (if you have more than one), and click Pay Selected Bills.

4.  If you haven’t entered the bill yet, you can go to Banking > Write Checks (if your checking account was used) or Banking > Enter Credit Card Charges (if your credit card was used).


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This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.

Ruth Perryman - QuickBooks Specialist Written by +Ruth Perryman

Ruth is the an Intuit Premier Reseller that offers great deals on QuickBooks POS and QuickBooks Enterprise. She has provided expert QuickBooks help to thousands of businesses all over the world since 1996.

Visit our webstore for great deals on QuickBooks and QuickBooks POS!