Small businesses wishing to do their own accounting can easily implement Quickbooks for their double-entry accounting needs. While it is advisable to have an accounting on staff or have an outsourced accountant to periodically review numbers, having this software allows small businesses the opportunity to minimize this expense in the startup phase. Using accounting software allows businesses to organize all of its finances in one place, saving both time and money in the long run. Specifically with Quickbooks Pro 2010, it allows users to:
- Manage customer, vendor and employee data.
- Print checks, pay bills and track expenses.
- View snapshots of the business with advanced reports.
- Go paperless with online banking.
- Allow up to 3 users to work in Quickbooks at the same time.
- Keep track of receivables.
- Download bank and credit card transactions directly into Quickbooks.
- Track inventory, set reorder points and create purchase orders.
- Easily locate any account, report or invoice by keyword searches.
- Manage your bills.
- Track sales, sales taxes and customer payments.
- Manage payroll and payroll taxes.
- Send invoices and estimates.
- Accept credit and debit cards right into the software.
- Track time, mileage and expenses to bill clients.
Why Use Quickbooks for Small Business Accounting
Not only is keeping track of all income and expenses helpful for when it comes time to pay taxes, but by entering all this information into a program such as Quickbooks, business owners can see how its company stands in a variety of areas. For instance, with a click of a button, the business can see its current assets and liabilities, cost of goods sold, current inventory, view all transactions per vendor or client and if they have any outstanding bills that must be paid.
Quickbooks is very simple to set up and maintain. After installation, the business owner must go through an advanced wizard that will set up the software depending on the type of business and its specific needs, as well as takes the owner step-by-step on adding its bank account information and product or service details.
Quickbooks Online or Quickbooks Pro Software
Quickbooks either is available as an online data-entry program or can be installed onto a computer. Quickbooks online allows business owners added conveniences, such as being able to log into their account from anywhere, share financial information by adding additional users, data is automatically backed up, no software to install or upgrade and customer support is included. However, Quickbooks Online requires a monthly subscription in which varies depending on which features you would like to add. In addition, you will not have access to your accounting data if you lose your internet connection.
Quickbooks recommends that if you currently are using Quickbooks software, that you register for Online Plus so that you can enjoy the same features, otherwise you will not be able to do as much as before. This means that as of October 2010, spending $39.95 per month for Online Plus instead of paying one flat fee of $199.95 for the software. In one year, Online Plus will cost a business $479.40 to enjoy the same features of the software, yet be able to access data from anywhere and offer others access to it. If paying about $279 extra for this added convenience is worth it for you, then by all means it could be a good deal. However, for most small businesses, the best bet is to spend the money upfront to purchase the software version instead of paying monthly.
Tracking Personal Accounts with Quickbooks
Intuit created Quickbooks to meet the needs of small to mid-size businesses, while Quicken was designed for personal accounting. However, many sole proprietors successfully use Quickbooks for both their business and private accounts. This way, business owners do not have to learn and use two different programs for their accounting needs. In order to track personal income and expenses, enter these as a part of Equity so that it does not affect the financial reports, such as the Profit and Loss statement and Balance Sheet. Within the Equity section, create a set of personal income and expense accounts, in which you will use when entering in any personal income or expense.
Using an Accounting Software Program
While Quickbooks is the most popular accounting program for small businesses, there is other software available. According to Jeffrey L. Wilson in his article “The Best Small Business Account Software” published in PC Magazine, he states that Quickbooks Premiere Edition 2010 “deftly balanced all of the most important aspects of accounting and emerged as the Editors’ Choice winner in the desktop space, besting AccountEdge and Peachtree 2010.” In addition, he further announced that Quickbooks Online is the “clear all-around accounting choice,” while Freshbooks and Outright are good service providers, they do not compare to all that Quickbooks offers.
When considering which accounting program to implement, keep in mind that most people are trained in business school to use Quickbooks or have previous experience using Quickbooks for a previous employer. Even though those who are trained in Quickbooks can most likely easily migrate to a new software, it could require a learning curve and additional training.
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