What Does QuickBooks Do In Terms of Bookkeeping?

• Invoicing

• Bill and expense management

• Online payments

• Time tracking and billing

• Reporting

• Project management

• Payroll management

• Inventory management

• Tax preparation

Invoicing

QuickBooks Online allows you to create invoices and either print them or email them to customers. You can create a new invoice from scratch or by converting an existing estimate into an invoice. You can upload your company logo, select from different templates, change the invoice colors, edit invoice fields, and add personalized messages for customers.

Bill and Expense Management

QuickBooks allows you to enter new bills and expenses and keep track of them automatically by connecting your bank and credit card accounts to the platform. By doing so, all your expenses are downloaded and categorized automatically.

If you need to track a check or cash transaction manually, you can record it directly in QuickBooks in a few minutes. You can also add bills in QuickBooks when you receive them so that QuickBooks can help you track upcoming payments.

What’s more, you can set up scheduled bill payments in QuickBooks using QuickBooks Bill Pay, a new built-in feature that replaced the Bill Pay powered by Melio integration. Available in QuickBooks Online Essentials and higher plans, QuickBooks Bill Pay allows you to pay bills via bank transfer or check directly from QuickBooks in a few seconds and pay several bills at once.

Online Payments

You can add QuickBooks Payments so that customers can pay online directly from their emailed invoice. QuickBooks Payments is similar to other merchant services. However, because it’s integrated completely within QuickBooks, the sale, credit card fee, and cash deposit are all recorded automatically as they occur

Time Tracking & Billing

Employees or subcontractors can enter their own time as they progress through the day, or a bookkeeper can enter their weekly time if the employee submits a manual timesheet. Time entered and assigned to a customer will be available to add to the customer’s next invoice.

Also, any expense entered can be marked as billable and assigned to a customer. As with time, these billable expenses will be available to add to the customer’s next invoice. You don’t need the payroll add-on to track employee time for billing purposes. You need at least the QuickBooks Online Essentials plan to track billable hours and the Plus subscription to track billable expenses.

Reporting

By managing all your cash inflow and outflow activities in QuickBooks, you can print financial statements that provide useful information about how your business is performing. Lenders often require financial statements when you apply for a small business loan or line of credit.

You can run basic reports, like profit and loss, balance sheets, and statements of cash flows. You can also run more advanced reports, such as A/P and A/R aging reports and profit and loss by class.

Project Management

You can use QuickBooks Online Plus or Advanced to create and manage projects, assign income and wages to a project, and track expenses associated with labor and materials. QuickBooks Online’s project accounting module also allows you to generate project estimates and include inventories, labor, and sales taxes. You can monitor the profitability of each project you’re working on by generating a project profitability summary report.

Payroll Management

Payroll is an area that you don’t want to skimp on and try to do manually. Mistakes made in calculating paychecks can result in steep penalties and unhappy employees. QuickBooks has its own payroll function that can automatically calculate and run payroll as often as you need.

The best thing about using QuickBooks Payroll is that it’s integrated with QuickBooks, so your financial statements are always up to date as of the latest payroll run. You must purchase a QuickBooks Payroll subscription to run payroll, but you have several levels of service to choose from to fit your needs.

Running your payroll through QuickBooks will allow you to:

• Pay employees with a check or direct deposit

• Calculate federal and state payroll taxes automatically

• Have QuickBooks fill in the payroll tax forms for you

• E-pay your payroll taxes directly from QuickBooks

Inventory Management

Available in QuickBooks Online Plus and Advanced plans, the inventory management feature helps you track the quantity and cost of your inventory. As you sell inventory, QuickBooks will allocate a portion of your inventory to the cost of goods sold (COGS) automatically, which is an expense account that reduces your income. This allocation is a requirement for calculating taxable income and is very cumbersome to do by hand. QuickBooks can also remind you to order inventory automatically when quantities are low.

Tax Preparation

By far, the largest headache in preparing a tax return is compiling your income and expenses. If you use QuickBooks during the year, all you need to do at tax time is print your financial statements. Better yet, with QuickBooks Online, you can invite your tax preparer to access your account directly so that they can review your numbers and print whatever information they need to prepare your return.

If you’re using QuickBooks Online, you or your accountant can easily transfer all the needed tax information through a tax preparation program like TurboTax. Bookkeepers and accounting professionals using QuickBooks Accountant can simplify tax preparation through ProConnect, a professional tax management solution.

Other Things You Can Do With QuickBooks

Depending on your QuickBooks product and plan, you may access additional features, including:

• Receipt Scanning: QuickBooks allows you to take a picture of a receipt through the mobile app and upload it to QuickBooks Online in a few minutes. You can upload an unlimited number of receipts to QuickBooks as the receipts are stored in the cloud along with your data.

• Mileage Tracking: For employees and individuals who use their personal vehicles for business purposes, QuickBooks allows them to keep a record of the date, miles, and purpose of their trips.

• Integration: If you’re using QuickBooks Online, then you have access to a wide array of third-party integrations. In addition to some native QuickBooks Online integrations—such as QuickBooks Payroll, QuickBooks Time, and QuickBooks Payments—QuickBooks Online connects with popular apps. These include PayPal, Melio, HubSpot, Expensify, LeanLaw, Square Payroll, and Expensify.

• Sales Tax Management: QuickBooks can help small businesses manage their sales tax obligations by calculating sales tax, preparing sales tax returns, and generating reports on sales tax liability. It can calculate sales tax for transactions automatically based on the tax rates and rules for the customer’s location.

• Mobile Accounting: Available for Android and iOS devices, the QuickBooks Online mobile app lets you create and send invoices, accept payments online, and assign expenses to projects or customers. You can also track your business mileage and view financial reports from your smartphone

• Fixed Asset Management: Available exclusively in QuickBooks Online Advanced and QuickBooks Enterprise, the fixed asset accounting tool allows you to add, manage, and track fixed assets, like buildings, vehicles, machinery, and equipment. QuickBooks automatically calculates depreciation expenses based on the depreciation method you choodr such as straight line and double declining.

• Business Checking: QuickBooks Checking is a free business account with no monthly fees and balance requirements. Available for QuickBooks Online users, this online-only banking solution lets you process instant deposit payments (requires QuickBooks Payments), use the free Visa debit card called the QuickBooks Debit Card, generate business balance projections, and more.

• Lending: QuickBooks Capital is a lending service by QuickBooks that allows users to borrow loan amounts from $1,500 to $200,000 with terms from six to 24 months. It’s available exclusively for businesses that have earned over $50,000 within the past 12 months.