QuickBooks is the bookkeeping software that most small businesses use; and it’s what I recommend for all my clients. This section gives an overview of QuickBooks, how to set up your company file, and start entering basic transactions.
Before starting this course, think about your goals with a bookkeeping system. What do you want to know about your business? Do you want to understand the profitability of different crops? Do you want to know if it makes sense to sell at a farmer’s market? Knowing the questions you want to answer will help you set up a system to get there.
At the end of the section, participants will understand:
The difference between online and desktop versions; and how to decide which is best for their own needs
How to set up a Chart of Accounts to best track financial data and give you the information you need to understand your business
The process for completing basic transactions like paying bills, creating invoices and making deposits
Classes and how they can help a business owner track the profitability of different enterprises
Julia Shanks consults with food and agricultural entrepreneurs to achieve financial and operational sustainability. Working with a range of beginning and established farmers, she provides technical assistance and business coaching that empowers them to launch, stabilize, and grow their ventures.
Hi Julia, I’m just wondering if there’s an easy way to remember the difference between classes, items and subaccounts. Aren’t all of them associated with an account? Are they just different tools to show information in various ways?
Also, I’ve been using Customers as my chart of accounts. So “Farmers’ Market,” “CSA,” and “Restaurants” etc. are all Customers. Is it bad to change this after seven years? It will throw off data when I’m comparing multiple years before and after changing the system, but it feels like it would be worth it?…
Things that are part of your Chart of Accounts will show up on your profit and loss and balance sheet statements. Using parent accounts and sub accounts helps you organize your different accounts so that you can group things together.
You can think of classes as “enterprises.” You can have an expense (that’s created by your chart of accounts) that can be applied to different enterprises… like you might have feed for your layers and feed for your meat birds. Or seeds for your flowers and seeds for vegetables… it offers a deeper level of categorization.
Customers are a third way to categorize revenue and expenses. You can have an expense (Farmers market fees, for example) that’s associated with a certain customer.
When you are running reports, you can show columns for classes or for customers…
Items are utilized on invoices and sales receipts, and they point to an account on the income statement. this allows you to capture the extra detail of what you’re selling without creating too much of a mess with your chart of accounts.
Yes – definitely make changes that will make things easier going forward. It will be harder to compare year over year for the first year… but then it will get a lot easier.
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Very good so far
very helpful
Hi Julia, I’m just wondering if there’s an easy way to remember the difference between classes, items and subaccounts. Aren’t all of them associated with an account? Are they just different tools to show information in various ways?
Also, I’ve been using Customers as my chart of accounts. So “Farmers’ Market,” “CSA,” and “Restaurants” etc. are all Customers. Is it bad to change this after seven years? It will throw off data when I’m comparing multiple years before and after changing the system, but it feels like it would be worth it?…
Thank you! This has been very helpful.
Not sure if there’s an “easy” way to remember…
Things that are part of your Chart of Accounts will show up on your profit and loss and balance sheet statements. Using parent accounts and sub accounts helps you organize your different accounts so that you can group things together.
You can think of classes as “enterprises.” You can have an expense (that’s created by your chart of accounts) that can be applied to different enterprises… like you might have feed for your layers and feed for your meat birds. Or seeds for your flowers and seeds for vegetables… it offers a deeper level of categorization.
Customers are a third way to categorize revenue and expenses. You can have an expense (Farmers market fees, for example) that’s associated with a certain customer.
When you are running reports, you can show columns for classes or for customers…
Items are utilized on invoices and sales receipts, and they point to an account on the income statement. this allows you to capture the extra detail of what you’re selling without creating too much of a mess with your chart of accounts.
Yes – definitely make changes that will make things easier going forward. It will be harder to compare year over year for the first year… but then it will get a lot easier.
Hope this helps!
Thank you! Very helpful!