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9 posts from April 2010

5 Things Manufacturers Need to Know about QuickBooks

So you seem to recall seeing somewhere that QuickBooks has a manufacturing version and
thought it might be the answer for your business?


It is very true that there is a QuickBooks Manufacturing and Wholesale edition (not sure why they combined those business types into one package, but I won't go there in this post). 

However, whenever I hear QuickBooks and manufacturing in the same sentence, it gives me reason to pause. The QuickBooks Manufacturing and Wholesale edition can be a perfect solution for some manufacturers, and not-so-perfect for others.

Here are 5 things you should know about the manufacturing edition of QuickBooks:

1) It only supports an average cost system. For many businesses, that is perfectly fine and of no concern. For others, it is a big one. You would have to look into the QuickBooks add-on market space for FIFO, LIFO,  specific, landed or other costing calculations.

2) It knows nothing about routers or shop floor planning. Remember, QuickBooks is an accounting package with some manufacturing capabilities tossed in.

3) Serial # tracking is not supported. In order to have this capability, you would have to use the Warehouse Management System module that is only available in the QuickBooks Enterprise version. It is not available in the Pro or Premier versions of QuickBooks, not even the QuickBooks Premier: Manufacturing and Wholesale Edition.

4) Lot tracking is not supported. Same as #3 above - just substitute lot tracking for serial # tracking.

5) Multi-level  bills of material are possible, but rough to work with. By that, I mean you can create a BOM that has multiple levels in it. However, trying to work with them to find things such as where used, substitutions, etc. is not practical.


If your manufacturing business doesn't need any of the above functionality, the QuickBooks Manufacturing and Wholesale edition may be a very good fit for your needs. In fact, tens of thousands of manufacturing businesses are using it quite successfully today.

If your business does have a need for one or more of the above functions, here is the winning (and budget-friendly) game plan:

  • Use QuickBooks for all of your accounting and financial reporting needs, and use an add-on package that meets the specific needs of your manufacturing systems and requirements. There are several excellent packages that seamlessly integrate with QuickBooks to provide the best of both for your business - the best accounting and the best manufacturing. Even better, this approach is usually tens of thousands of dollars less than trying to use one of the more complicated manufacturing software or higher end accounting software alternatives.


Scott can help you make heads or tails out of the QuickBooks add-on marketplace when it comes to manufacturing. He offers a value-priced mini-needs assessment service to help you save time on your initial search. He also offers a more comprehensive needs analysis service for more complicated environments.

Don't waste another minute trying to sort through the thicket of tech jargon to determine what is right for you. Contact Scott today!



Inventory Stock and Reorder Management System for QuickBooks

Have you been looking for more and better ways to analyze and assess your inventory than QuickBooks offers?

Consider the Inventory Stock Management and Reorder System for QuickBooks from the Fermen Corporation.

This particular software is one of the growing suite of add-on products for QuickBooks. These add-ons provide extended functionality and feature sets that QuickBooks can't or won't provide. Right now, there are over 450 add-ons delivering advanced functionality to QuickBooks.

In addition, they help businesses retain their core accounting systems and not have to blow their budget by moving up into the majorly expensive realm of business software.


  • Set min and max values for in-stock days
  • Set a range for which to analyze sales data and inventory requirements
  • Analyze inventory by warehouse (requires Enterprise Warehouse Management system)
  • Provides minimum and maximum recommended stocking levels based on your criteria
  • Auto generation of purchase orders if desired

This module is one of several add-ons for QuickBooks that Fermen has created to offer enhanced functionality in the inventory control and other areas of a business.


Scott can help you make heads or tails out of the QuickBooks add-on marketplace. He offers a value-priced mini-needs assessment service to help you save time on your initial search. He also offers a more comprehensive needs analysis service as well.

Don't waste another minute trying to sort through the thicket of tech jargon. Contact Scott today!



What the Heck are Debits and Credits in QuickBooks?

This post will allow you to condense an entire semester of accounting into just a few paragraphs (and many would say that is still too much!).

More importantly, it will help you better understand the jargon your CPA lays on you the next time they want to talk about "posting journal entries" and other complicated accounting stuff.


In QuickBooks menu bar, if you click Lists > Chart of Accounts (one of several ways to access it), you discover the heart and soul of your accounting system.

In the chart of accounts, you see a listing of accounts with various names such as checking, inventory, rent expense, etc. The common theme in this listing is that each account boils down to one of the following types:

  • Asset - something you own (checking account, inventory, etc.)
  • Liability - something you owe (sales tax, bank loan, etc.)
  • Equity - your ownership share (assets - liabilities)
  • Income - dollars into the business
  • Expense - dollars out of the business


Every time you write a check, create in invoice in QuickBooks (or enter any other transaction), you are actually interacting with the chart of accounts and creating an accounting entry (though you may not have even realized it!).

Each of these entries is actually creating a "debit" side of the entry and a "credit" side of the entry. For example, if I create an invoice for Customer A in QuickBooks to sell them $100 of design services, here is what QuickBooks actually sees "behind the screen" when you hit save and close (Click the picture to make it easier to see if needed):

 Debit and Credit Posting
Note in the above example there is a debit to "Accounts Receivable" for $100 and a credit to an account called "Design Income" for $100.

IMPORTANT TO KNOW - For every debit, there has to be a credit and the total debits must equal the total credits.

That's the way the accounting police wrote the rules, but it has worked very well that way for centuries. In fact, some entries may have multiple debits and/or credits, and that is perfectly OK as long as they balance out. 


So how do you know what impact a debit or credit has on the accounts showing in your chart of accounts?

Easy! Just refer to the chart below...

Asset: Debit = an increase in value. Credit = decrease in value. For example, if you credit your checking account, you are decreasing its' value (bummer..).

Liability: Debit = a decrease in value. Credit = increase in value. Example - if you credit your account for the loan payable to your bank, you are increasing its' value (you owe the bank more $$).

Equity: Debit = a decrease in value. Credit = increase in value. You always want your equity to be increasing!

Income: Debit = a decrease in value. Credit = increase in value. So, keep creating invoices, as each invoice credits your income account, and that is a good thing indeed!

Expense: Debit = an increase in value. Credit = decrease in value. Debit an expense account = Yuck (but you gotta do it sometimes!)

And there you have it - an entire semester of accounting delivered in just a couple of minutes!


To see the geeky accounting and debits/credits of ANY transaction in QuickBooks, simply click Reports in the menu bar, then Transaction Journal. It brings up a screen just like the one pictured above (or tap CTRL + Y on your keyboard for instant access too!)

Need help bringing order in the chaos that is your chart of accounts? Contact Scott today for expert insight and assistance!



What are the Benefits of Using a Service to Host QuickBooks and Other Software?

I recently came across a very interesting article in the Practice Development News from InSynq. The article offered some valuable insight into why businesses have opted to access their QuickBooks and other applications via a hosted solution instead of handling it in-house.

In the article, author Joanie Mann shares feedback received directly from their hosting customers. Here are the leading reasons why businesses opt for a hosted solution with InSynq:

  • Ability to connect anytime, anywhere, with my applications and data (48.1%)
  • Ability to collaborate with team members and/or clients (21.6%)
  • Ability to focus on my business and not on my technology (10.8%)
  • Benefit of knowing my data is secure (3.6%)
  • Benefit of 24x7 technical support (2.4%)
  • Benefit of predictability in IT cost (1.2%)

As you can see, businesses of all types really value the idea of anytime, anywhere access for their QuickBooks and other critical business software.

Based on my consulting work with small businesses using QuickBooks, I would have thought the "ability to focus on my business and not on my technology" would have scored higher in the survey. I see small businesses struggling on a regular basis with the technology piece of this (i.e. servers, networking, desktops, etc.). In fact, I've been in several businesses that were ready to toss their servers out the window.

If you find your business becoming more mobile and need "always on" access to QuickBooks, the use of a hosting service should be considered as a critical addition to your playbook.





Tip For Accountants - Use the QuickBooks Toggle Feature to Your Advantage

The Accountants edition of QuickBooks has a powerful option that sits on the File menu just waiting for you to take advantage of it.

The "Toggle to Another Edition" allows you to put yourself in the exact same position as your client that may be calling with a question.

For example, if your client is trying to review a report in the Contractors' edition, you can quickly flip your version over to the Contractors' edition and see exactly what they are referring to.

Toggling is easy - click File > Toggle to Another Edition and then select the version (note you can even flip to the Pro version) from the window below:

Toggle Button

Click the Next button and the transition begins. When finished, you can simply toggle back to the Accountants' edition.

I believe this toggle feature is available in QuickBooks Accountant Edition 2007 or later.



SmartVault Retools - And Brings Even More Document Management Functionality to Small Businesses and Accountants

The SmartVault document management system isn't just for QuickBooks users any longer (though it is still a great solution for businesses and accounting firms using QuickBooks!)Smartvault_vert_fullcolorsm

With the release of version 3.0, SmartVault now takes a step beyond QuickBooks and offers a robust and easy-to-manage document management platform that ties together ALL the documents a business or accounting firm uses, not just those that relate to QuickBooks.


The retooled SmartVault brings the following benefits:

  • Save documents easily directly into SmartVault - by integrating with Windows Explorer, users can quickly and easily used mapped drives to save documents from their favorite apps directly into SmartVault. No IT department required!

  • Access important documents from an iPhone or any other smart phone. Don't be chained to the office any longer to get your important stuff.

  • No need to hassle with flash drives to move documents around. You can now set access for a specific person or group of people on a document or folder within SmartVault. Just imagine your accounting firm letting clients access only their documents electronically or a business allowing customers to see just their important documents with the click of a mouse!

  • Go crazy adding folders and sub-folders.There is no longer the limitation that a document ha to be saved within the transaction structure of QuickBooks. Set up folders just like you have done on your desktop or My Documents to simplify your document management.


That is true.

But what if you are using an older version of QuickBooks and don't want to upgrade? Why wait to reap the benefits of document management. You can plug in SmartVault today.

But what if you want a more robust solution, a better user experience, and one that includes not just your QuickBooks, but ALL of your documents? SmartVault has you covered there.

Take a closer look  for yourself at the comparison between SmartVault document management and QuickBooks 2010 document management.


SmartVault provides the ability to try before you buy with a free document management and storage plan. You can test it against the needs of your business or accounting firm at no risk.

I've been using SmartVault in my business for over a year now, and it has really helped me go from a paper mess to paperless.

What are your thoughts about the SmartVault system? Feel free to post a comment below...



How to Split an Entry in QuickBooks

The ability to split an entry in QuickBooks to include multiple accounts when writing a check or entering a bill is an easy task once you get the hang of it.

In the example, below, I am writing a check to my landlord for $1,500. That check breaks down into the following expense categories I want to list on the check:

  • Rent = $1,000
  • Maintenance = $100
  • Utilities = $400

Here is a screen shot of how that check would look with a split entry (click the graphic below so it displays in a better resolution for you):

Split Entry Screen on QuickBooks Check 

As long as total of the bottom portion of the check (or bill) screen matches the total being paid at the top, everything is in good order. From here, you would click Save and Close and the transaction is then recorded to the appropriate accounts within QuickBooks.



Setting the Right Expectations for Using QuickBooks

Hope Road Sign Do you think the people who recently posted these tweets had the right expectations about QuickBooks? (doubtful!) 

  • "QuickBooks is stupid"
  • "Ugh. QuickBooks will be the death of me"
  • "QuickBooks is gonna give me an aneurysm. I don't get it!"
  • "Man, QuickBooks isn't nearly as intuitive as they want you to believe! I have no idea what I am doing. Ugh!"

Notice a theme here?


With any project you undertake, dialing in your expectations to the expected outcome of the project is essential.

Setting the expectations when it comes to using QuickBooks or Peachtree to tackle your business accounting is no different.

Unfortunately, tens of thousands of businesses fail when it comes to this step - they embark on a journey with no direction that quickly leads to frustration, desperation, and usually, very bad financial decisions.


One of the classic QuickBooks marketing ploys was to show a smiling business owner pecking away at his keyboard while the voice-over exclaimed - "if you can write a check, you can use QuickBooks!" Yipee!


Sure, you can use QuickBooks. But the likelihood of you using it correctly?



  1. There is no "magic bookkeeping dust" in the box - Didn't know or understand bookkeeping before you installed your QuickBooks or Peachtree software? You won't know it any better once the installation has completed.

    In fact, with QuickBooks, you are immediately presented with an "Easy Step Interview" to get your company going. You'll face over 40 questions during this "easy" interview. And watch out for terms like "fiscal year", "chart of accounts", and other accounting jargon. I've always told my clients - "QuickBooks will always win the staring contest while you stare at the screen trying to figure out what they are asking".

  2. If you dislike tracking your personal finances, you'll dislike tracking your business finances even more - instead of worrying about just getting your personal checkbook updated, you'll have to ensure that you keep your sales taxes paid timely, payroll deposits and filings done on time, your government reporting (1099, etc.) done correctly AND provide accurate information for your tax preparer to use for your business tax returns. That is a big burden to take on, especially if you don't like it to start with!

  3. Getting it wrong in the beginning actually costs you more in the long run - the "do it yourself accounting economy" is alive and thriving. Businesses mess it up during the year and then pay their accountant a bundle to fix it. And then they repeat the process the next year. A tidy little revenue stream for the accountant indeed.


  • The setup of your QuickBooks or Peachtree is absolutely critical. After seeing hundreds of self-made disasters over the years, my advice is to invest in yourself and your business and get professional guidance to get it set up the RIGHT way, right out of the gate. For example, I have created a QuickBooks Fast Start program to help get businesses going the right way.

  • Get a quarterly review of your accounting records for at least the first two quarters. By doing this, you'll be able to get the majority of problems, questions and corrections put in place sooner, rather than later.

  • Get an X-Ray if you have been using QuickBooks or Peachtree for a while. I find that many QuickBooks users inherit information from former bookkeepers or even the business owner that is simply wrong. Invest in your business and have a professional perform an x-ray and other diagnostics on your accounting to identify problems and help ensure you are using the software as it was meant to be used.


By setting the expectations that you will either get the proper setup and ongoing support or completely outsource your bookkeeping from the beginning, you will be a LOT happier and FAR less likely to be tweeting comments like those mentioned earlier.



Did Your QuickBooks Barf on Itself This Morning?

It is true...Doctor and infected computer

Computers have bad days, just like people do.

And if your computer had a bad day recently and has wreaked havoc on your ability to use QuickBooks, I would like to offer some steps you can take to try and remedy the situation.


The very first thing we need to determine is this - are you having trouble getting into the QuickBooks program itself or trouble getting into your QuickBooks data and transactions? Your answer to this is key to the troubleshooting steps that need to follow.


By this I mean - if you double-click the QuickBooks icon on your desktop and you can't get it to open as it should or if some random techno-speak error message appears.

Suggested plan of action:

  1. Reboot your computer. It is amazing how many ills can be cured by this process
  2. Go to your Control Panel and look for the Add/Remove Programs icon. Double-click it and browse the list until you find QuickBooks in the list. Click the Remove button, then follow the prompts and choose the REPAIR option (NOT the remove option - that may come later). Let it do its' thing and repair your copy of QuickBooks. When finished, my suggestion is to reboot and try to start QuickBooks again.
  3. Still having trouble? Search for a file called reboot.bat on your computer. It is usually stored in the same location where your QuickBooks program was installed. Once you find it and have verified that the file is related to QuickBooks/Intuit, double click to run it. You will see a black and white box appear and lots of text zoom by - that is perfectly ok. Once this finishes, try to open QuickBooks again.
  4. One last thing to try before completely uninstalling and reinstalling QuickBooks is to attempt a System Restore from Windows. In some situations, I have been successful in doing that and getting the QuickBooks program to start up again.

There are other more advanced steps to take if the above don't work. At that point, your best bet is to hand it off to a QuickBooks specialist for help and insight. Remember, there are many specialists like me out here that are available to  provide the help you need.


By this I mean - the QuickBooks program itself opens up just fine but you see some cryptic-looking error message that relates to a problem or corruption (now that is a scary word in this situation!) in the data file.

I'll be honest with you - this type of problem is usually much worse than ones where the QuickBooks program itself won't open as discussed above.

Options available to you:

  • Restore your QuickBooks data file from last nights' backup. You do have a backup, don't you? There are a number of excellent backup applications out there. I highly recommend Mozy Pro to backup your QuickBooks and other critical computer data. I've been using it for quite a while now in my business.
  • Get in touch with the QuickBooks data recovery team. Note that you have to be using a supported version of QuickBooks to have access to the data team and also their fees and turnaround times. (I didn't say the solution would be cheap).
  • Use a third-party data recovery service such as QuickBooksUsers.com. You may likely find their turnaround time, level of assistance, and overall support to be much better (and understandable) than offered directly by the QuickBooks team.


If you are not comfortable attempting any or all of the suggestions discussed above, please contact me using the button below. We can work together remotely to try and diagnose the problem and figure out the best plan of action.