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View Full Version : Which version of Quickbooks to use?


Appleby
07-18-2010, 06:38 AM
I've been using Quicken Home & Business since I really got my business up and running. It's been great and it really pretty easy for me to use. All my bank and credit cards accounts are linked to it and import via the "one step update". I've also got all my personal accounts set up separately in a different company file. I do all my invoicing through Quicken and it seems to work great. The only issue I have, which isn't the end of the world, is the fact it's not the easiest to keep up with which invoices have been paid, which have been deposited etc. I have a system and it's worked for over 4 years but everyone tells me I need to be using Quickbooks.

I'm willing to upgrade if it would really help me out, but the only way I can see Quickbooks making my life easier is with the paid invoicing area, as I mentioned above.

That being said.....should I be using Quickbooks and if so, which version? Thoughts?

ProTech Support
07-18-2010, 06:40 AM
Never really used Quicken, so not sure how I can convince you to switch over. I am using Quickbooks Pro 2008 and it has been really good to me. Everything I can dream of needing I have. Never ran into a task I could not do, and I love all of the reports it can feed me..

Larry Sabo
07-18-2010, 02:05 PM
I use Quicken 2005 and QuickBooks Pro 2009 -- Quicken for personal finances and QB for the business. I blend my use of money (pay for parts using personal credit card, for example), so most business transactions also go into Quicken. The redundancy helps solve problems that arise when I forget to enter a transaction into one or the other program. With QB, I record receipt of payments to the "Undeposited funds" account and then record the deposits after I go to the bank. It all works great. Posting payments against open invoices is so easy, and it handles partial or over-payments with aplomb. I enter notes into the invoice for future reference and they appear on the invoice, which I often send to the customer as a PDF, which I think helps my cred and shows the customer that fixing their PC is not a cakewalk. QB is terrific but if you have a system that works, why bother? It's not like it's free,

atlanticjim
07-18-2010, 02:15 PM
I have been using Quickbooks Pro for years and after a bit of learning curve, I am very happy with it. Part of the learning curve for me was accounting terms and practices (what the hell is COGS anyway). Sometimes I can tweak out some interesting reports but mostly I use it for:


Creating invoices that detail what I have done. I use this to show the value to the client as well as keep a good record of what was done.
Creating Estimates. Often at the end of a job I will add an Estimate for a suggested upgrade. This way I can keep track and refer to it a month later when they want that memory added.
Uncollected funds. We all have them from time to time. Quickbooks reminds me routinely about my deadbeats and I can send out 2nd and 3rd notices.
In the reports, I like to see my profit per job so that I can keep in mind what is most profitable and concentrate on getting that business.


I do want to caution you about mixing personal and business funds. You should really keep them separate for legal reasons. I have one credit card for the company that works very well. When I want to use business funds for personal use, I just take an "owner's draw" on the account. It will then count as personal income at the end of the year.

ComputerClinic
07-18-2010, 02:52 PM
I use QuickBooks Simple Start and it works fine for me. I use it for basically everything atlanticjim uses it for. The reason I choose simple start over pro was because it was free for the first 20 clients, and I didn't have a ton of money to throw at my business at the beginning. I plan on upgrading to pro, however, because of the the ability to make custom invoices. I'm sure there's more that Pro can do besides that also (like automatically reminding you of deadbeats; I didn't know it could to that). If you have the money, just get Pro.

Larry Sabo
07-18-2010, 03:38 PM
I do want to caution you about mixing personal and business funds. You should really keep them separate for legal reasons... When I want to use business funds for personal use, I just take an "owner's draw" on the account. It will then count as personal income at the end of the year.Since I'm a sole proprietor, it makes no tax difference for me. However, I do use Owner Contribution/Draw for any expenses paid with personal accounts/funds transferred to personal accounts. I agree that it's a bad practice, because it leaves your personal accounts open to inspection if the business gets audited. Since I do everything by the book, they are free to audit my personal accounts any time they like. I have absolutely nothing to hide. :) It's still not recommended!

Appleby
07-18-2010, 10:08 PM
Thanks for all the replies guys. From what I'm hearing, it doesn't sounds like it would be worth the price for me to upgrade. What I'm doing now works just fine and I don't seem to have any problems with it. Like I said, I'm using Quicken Home & Business, so it was at least partially designed with business in mind. I have custom invoices created in Quicken and my system seems to work.

I do have a couple minor issues, but someone mentioned the "Undeposited Funds" where paid invoices go. I saw someone on a Quicken forum mention creating something like that and that QB had it build in. I wasn't sure what they were talking about, but that makes perfect sense. I think I'm going to have to try that in Quicken....

I think the address book in Quicken is horrible. At least the way I'm using it is. That is the one thing I don't like. It's a long story and I'm not using it like it's designed but I still don't like it.lol

Again, thanks for all the advice guys. I think I'm just going to stick with what is working for now, especially since I upgrade every other year and it costs about $50, because I find a deal on the software.

Appleby
07-18-2010, 10:16 PM
Since I'm a sole proprietor, it makes no tax difference for me. However, I do use Owner Contribution/Draw for any expenses paid with personal accounts/funds transferred to personal accounts. I agree that it's a bad practice, because it leaves your personal accounts open to inspection if the business gets audited. Since I do everything by the book, they are free to audit my personal accounts any time they like. I have absolutely nothing to hide. :) It's still not recommended!

I haven't figured out what to do in Quicken about paying myself or taking draws. It always looks like an expense in the reports and it's really not an expense at all. This has always puzzled me.

Oh and I just tried to setup and use an "Undeposited Income" account in Quicken. No can do. I have to accept the payment for the invoice to get it into that account. Then there is no way to easily move the invoice/payment to my checking account, since the payment has been accepted to the undeposited income account?

SOHO-NZ
07-18-2010, 10:26 PM
I have been using Quickbooks Pro for years and after a bit of learning curve, I am very happy with it. Part of the learning curve for me was accounting terms and practices (what the hell is COGS anyway). Sometimes I can tweak out some interesting reports but mostly I use it for:



COGS = Cost Of Goods Sold
If you purchase stock that you will be onselling, then record it using a COGS account.

ComputerClinic
07-19-2010, 12:29 AM
I haven't figured out what to do in Quicken about paying myself or taking draws. It always looks like an expense in the reports and it's really not an expense at all. This has always puzzled me.

I have the same problem with QB. Do I create another bank account or what?

Larry Sabo
07-19-2010, 02:21 AM
You have an account for your business banking, from which you write cheques to pay business expenses. This should be separate from your personal accounts. When you take money out of the business , you write yourself a cheque on this account and charge it to the Owner Contributions/Draw account. In Quicken, I also have the business and personal accounts, and record the cheque as a transfer from one to the other.

If I use my personal credit card to buy something for the business, I create an entry in QB charging my Personal Credit Card account (which I set up in QB but don't reconcile against my credit card statements) for the item and allocate it to whatever expense account applies, e.g. Cost of Goods:Parts. I also make an entry in the same transaction debiting Owner Contributions/Draws and click the Recalculate button so the total is zero, as below.
http://i29.tinypic.com/4gqger.jpg

In Quicken, I have the business account and the personal account, and make entries that match those in QB. When I get my bank statement, I reconcile against Quicken and QB. Hope that helps.

Appleby
07-19-2010, 05:42 AM
For the record, I have 100% business and 100% personal and they never intermingle unless I accidentally use the wrong CC card etc which is a rarity. The personal and business accounts are even separated in Quicken by differing company files.

Ok I'll be honest I'm a little confused by what you are saying....

Here is an example I'll use...If I pay myself $1,000, let say via a check just to keep it simple, I show the expense category as Owner Contribution/Draw when the check is posted to Quicken. But now when I run reports, if I don't customize the reports, I will show an expense of $1,000, which goes against my bottom line of profit. $1,000 was not an expense at all, it was just a draw. I know it could be considered an expense if you pay yourself a certain salary and need to see how your profits are including your salary expense etc. But I don't do it that way. We "live" on my wife's salary and take my business income out in large lump sums to use for things like large mortgage prepayments, investments etc.

So anyway, without customizing the report, I can't see a way that this will "wash" and not show up as an expense?

kagman
07-19-2010, 11:44 AM
I just started using quckbooks simple starter 2010. Got it on amazon for 30 dollars less then what intuit was charging. Have to say that it is really simple to use. And you can upgrade that to the other quickbooks pro version with just a few mouse clicks. Get it at amazon.com for 70 dollars :)

Larry Sabo
07-19-2010, 01:15 PM
If I pay myself $1,000, let say via a check just to keep it simple, I show the expense category as Owner Contribution/Draw when the check is posted to Quicken. But now when I run reports, if I don't customize the reports, I will show an expense of $1,000, which goes against my bottom line of profit. $1,000 was not an expense at all, it was just a draw. ....Owner Contribution/Draw is an asset category, not an expense category, in my QuickBooks and should be in yours. Can you edit the Owner Contribution/Draw account category to make it so? That would be the solution.

ComputerClinic
07-19-2010, 05:00 PM
Owner Contribution/Draw is an asset category, not an expense category, in my QuickBooks and should be in yours. Can you edit the Owner Contribution/Draw account category to make it so? That would be the solution.

Thank you! Your other post confused me too:o. That's why I was wondering if I should make it a bank account. Equity, asset, income, expense, bank....I didn't know which one to choose but I figured expense wasn't right.

Larry Sabo
07-19-2010, 07:58 PM
I apologize for the confusion, and hope it is clear now. If not, don't hesitate to let me know.

Appleby
07-20-2010, 04:57 AM
Thanks Larry! Ok, so I'm 1/2 way there. I created a business asset acct. called "Draw".(hopefully I'm not making any contribs. anymore!).

So I write myself that $1,000 check now. When it shows up in Quicken, I show it as basically a transfer to my Draw acct. It does not show up as an expense in Quicken, but a transfer. My checking acct is $1,000 lighter and my Draw acct shows a $1,000 balance. Great. But now what? That money is not in the Draw account, it's in my pocket. So I have to 0 out that draw acct and show that I took the money "out" of the acct so to speak. If not, I'm still showing the money as a business asset....it's just been moved to a new acct.

So now how do I categorize the money leaving the draw acct and it not show up as an expense? I guess I'm confused again.;)

Thanks!

Larry Sabo
07-20-2010, 01:42 PM
I would have called it "Owner's Contributions/Draws" but it really doesn't matter, so long as you also have a Owner's Contributions account for times when you put personal money/equity into the business. I thought these accounts were already in QuickBooks in their default set of accounts, but I could be wrong. Have a read of "Owner's Draw" in QB Help.

When you set up the business, whatever assets or other personal property/equity you put into it should have gone into the Contributions account (or Contributions/Draws account in my case). Contributions minus Draws represents equity that was added to/removed from the business during its lifetime, and shouldn't really be zeroed out arbitrarily. The total asset value of the business includes these contributions minus draws. If you sold the business you would calculate your profit based on the sale price less net equity, which would include the owner's contributions less draws. If you close down a business, you have to pay tax on the net asset value transferred back to you, I presume through a Owner's Draw transaction.

That's my feeble understanding of these accounts and how to use them; I could be off by a mile (or Km). I'd suggest that you ask an accountant for a more robust explanation, although I'm always happy to offer whatever help I can. Just don't bank on it. :)

Edit: I forgot that you are using Quicken H&B, not QB. The concept should be the same.