Mary Joyce Pelingon

Lib’s Cleaning Company is owned and managed by Libs Cleane. The business is organized as a sole proprietorship. You are the accounting clerk for the business – your job is to create a business in QuickBooks. Name the business as Lib’s Cleaning Company – [your initials]. It has only been in business for less than a year. It has never used QuickBooks before. Set up the new company. It needs to Invoice Customers, Track Expenses, and Manage Bills. It has no employees, so no need for payroll or time tracking. QuickBooks lets you download and import up to 90 days of your online banking transactions. However, Lib’s Cleaning doesn’t use Online Banking yet. Set-up the company information in Account and Settings:  The address and phone number of the company are up to you.  Industry: Janitorial Services  Company type: Sole proprietorship (Form 1040)  Fiscal Year Start: January Click on the Gear Icon then Account and Settings. Enter the company information. Set-up the chart of accounts. The chart of accounts for Lib’s Cleaning Company is listed below:  Make sure that the chart of accounts in QB matches these. Delete or edit, as necessary.  Edit the Sales account to change its name to Service Fees.  Add its Bank Account in the chart of accounts. Name the account, Cash in Bank.  Close the Chart of Accounts When you set up your company in QBO for the first time, QBO will set up a default list of accounts for you. It’s not a complete list, but it has many of the accounts that you will use. To add in the chart of accounts Click the Gear Icon on the upper right then Select Chart of Accounts. Here is another way you can get to the Chart of Accounts - From the left navigation bar, select Accounting. To create a new account, click New. Choose the Account Type, Detail Type and enter the Account Name. Click Save and Close. If you go back to the Chart of Accounts, you will see the account which was just added. Let’s add another account. This time, an Equity Account. If you go back to the Chart of Accounts, here’s the account which was just added. Below is the list of all accounts created. Set-up Products and Services. Lib’s Cleaning Company sells services only. It offers commercial cleaning and residential cleaning. For corporate buildings, it provides carpet shampooing for $100 and general cleaning services for $500. For houses and condos, it offers general cleaning services for $150. All prices may vary depending on the floor area. Click on the Gear Icon on the upper right and click on Products and Services. Click Add a product or service. Select Service. The service information window will open. Indicate the name of the service, category, sales price per rate (if you want that price to show up on an invoice. If not, leave it blank. You can always change it on the invoice.) and Income Account. Then Save and Close. Here’s what you’ll arrive at once done entering all services. January 2 Libs Cleane, the owner, invested $10,000 cash in the business. (Record Deposits) Click on Plus ( ) icon on the upper right corner near the gear icon. Select Bank Deposit. To enter a bank deposit: 1. Select the bank account that you will deposit the checks to. 2. Enter the date of the deposit. 3. Enter the name the deposit was received from, account name to be charged, description of the transaction, payment method and amount. 4. Make sure that the total amount equals to the amount that you deposited at the bank. 5. Click Save and New. January 4 - The business purchased $400 worth of computer equipment from Express Computers, writing a check. Click on Plus ( ) icon on the upper right corner near the gear icon. Select Check. The Check window will open. To add a payee, click on the down arrow and “Add New”. Enter the name of the Vendor then click Save. If a vendor list already exists in QBO, just click on the down arrow and search for the vendor name you need. 1. Select the bank account to post the payment to. 2. Enter the date of the payment. 3. Enter the number of the check you used. You can also enter “ACH” or “Wire Transfer” or “EFT” if you made the payment electronically. 4. Make sure that “Print later” box is unclicked. 5. Enter the account category from the chart of accounts. In this example, we are using Computer Equipment. 6. Enter the amount of the check. 7. Click Save and new. January 5 - The business purchased $300 of window wipers on account from Commercial Soapies, Inc. To create a bill, go to “Expenses”, New Transaction then choose “Bill”. Enter the name of the vendor, terms of payment, bill date, the category or account name and the amount due. Click Save or Save and New. January 7 - The business received and deposited $650 cash received from its client Anne Bell (condo cleaning). (Create Sales Receipt – item is Services – a service related to the Service Fees account – don’t forget to Record Deposit). Click on Plus ( ) icon on the upper right corner near the gear icon. Select Sales Receipt. Select the name of the customer from the down arrow, enter the sales receipt date and payment method. Choose Cash on Hand or Undeposited Funds from the “Deposit To” field. Undeposited Funds is a temporary account that QBO uses to store payments until you show that you deposited them in your bank account. Choose the product or service and add amount. Click Save or Save and Send if you want to send a copy of a Sales Receipt to the customer. Here’s the preview of the sales receipt to be emailed to the customer. Click Send and Close. Let us now record the bank deposit. Click on Plus ( ) icon on the upper right corner near the gear icon. Select Bank Deposit. 1. Select the bank account that you will deposit the checks to. 2. Enter the date of the deposit. 3. Choose Undeposited Funds in the “Account” field and enter amount deposited. Undeposited Funds is a temporary account that QBO uses to store payments until you show that you deposited them in your bank account. 4. Click Save and Close or Save and New. January 10 - The business paid $250 to Statio Ads Company for advertising, and paid by check. (Write Checks – it’s an expense). Click on the Plus ( ) icon on the upper right corner near the gear icon. Select Check. 1. Enter the payee name, bank account to be charged, payment date, category or account name. 2. Provide the description and the amount. 3. Click Save and New. January 13 - The business provided $1,200 worth of services to Moon Towers (building cleaning) on account. (Invoices). To create an invoice, go to the left navigation pane and click Invoicing then Invoices. Or you can click the Plus ( ) icon on the upper right corner near the gear icon. Select Invoices. Click on “Send your first invoice”. On the Invoice window, choose the customer name from the down arrow. Enter the terms of payment, invoice date, the service, description of the transaction and amount. Click Save and Send. Here’s the preview of the invoice that will be sent on the customer’s email. Click Send and Close. January 17 - The business paid Commercial Soapies, Inc. $100 of the money owed to them, paying by check. (Pay Bills) To pay bills, click on “Expenses” on the left navigation pane then choose “Vendors”. Select the vendor from the list and click “Make Payment”. The existing bill from the vendor will show. Indicate the amount to be paid then click Save and New. You can also click the Plus ( ) icon and choose “Pay Bills”. January 22 - The owner removed $650 from the business for personal use; the business paid this money by check. (Write Checks – expense associated with the Withdrawals account) Click on Plus ( -. ) icon on the upper right corner near the gear icon. Select Check. Select the payee name from the down arrow. Select the bank account to post the payment to. Enter the date of the payment. Enter the number of the check you used. Make sure that “Print later” box is unclicked. Enter the account category from the chart of accounts. Enter the amount of the check. Click Save and new. January 22 - The business received a check from Moon Towers the $1,200 owed to it and deposited that money in the bank. (Receive Payments – don’t forget to Record Deposit). To record the receipt of check from a customer, click on the Plus icon then “Receive Payment”. Choose the customer name from the list in the down arrow. The outstanding invoice from the customer will show. Select the invoice. Make sure to indicate the payment method, reference number (check no., in this example) and the Undeposited Funds. Click Save and New. To record the deposit to the bank of the check received, click on Plus ( gear icon. Select Bank Deposits. ) icon on the upper right corner near the Enter the information on below highlighted fields then click Save and New. January 29 - The business wrote a check to Veralco Company for $200 to pay the electric bill for the month. (Write Checks – it’s an expense). Follow previous examples in writing a check. Below is the screenshot of the details of the check.