Legal Survival Guide

Lesson 21 of 27

Quickbooks Accounting System

 

Legal Survival Guide

Lesson 21 of 27

Quickbooks Accounting System

 

Lesson Info

Quickbooks Accounting System

We're live on the web, right? We were were registered with the missouri secretary of state is an l l c we got a tax I d number we bought our domain name on go daddy we've we've purchased or downloaded a trial version of quickbooks we've got a marketing plan, we got a business plan. We've put together a the beginning because we bought a software package or helped or did it online. We're ready to go. We've saved up our money we've been saving up are thirty thousand dollars to launch our new business for such a long time this is our passion, it's our dream we were going to w p p I for like, what five or ten years waiting for this moment until we couldjust tell our boss to stick it where the sun don't shine we're leaving for greener pastures we are going to be large and in charge we're going to be blue steel photography so we are going to make some money and in order to put that money somewhere and keep track of it monitor our success. We've bought quickbooks now quickbooks learns I think ...

that's quickbooks singular learns singular verb as you go so I think my grammar is correct on that lee, if you were concerned when you create accounts but I was concerned actually the lawyer in me was coming through from there um you create the accounts as you go when you need them, you don't have to do this all at one sitting it's like photoshopped you on ly have tto learn one thing that you need at a time and this software platform is such that it has a pretty robust help menu. So when you actually need help, it gives you relevant help that you need. How frustrating is it? Some of the software that we use, we go to get help and it tells us how to fix some problem that we're not even asking about that's not really true with with quickbooks. So we create customers. And when we get them, we create vendors. When they bill us, we create create accounts as we need them. So without further ado let's implement what? Nobody likes advice in the abstract. People like to know how to implement right? So we are going to get getsem implementation going on on. All right. Here we go. No company opened, so we're in quickbooks pro two thousand fourteen file new company. Watch how easy this is. No excuses, jim. There is a blue express start button. Is there any? Is it a coincidence that the blue steel creation button is balu? Yes, here we go. Express start they want your e mail address and that's for purposes of they have a cloud based system so they'll actually store and back up your system for you in the cloud uh so you can put in your e mail address blue steel dot com and they're gonna want to validate you you don't actually if you don't feel like being validated I think you you don't have to but we'll go ahead and get validated uh I think I have a password now there's a button at the bottom you can either check are not check now depending on whether you're republican or democrat will govern whether or not you want the government to have your data and so if you want to back up on the cloud, check this if you don't uncheck it, okay and then when you're ready just hit the continue button and they don't like that email address password alright company name who are we now? The data that we enter here this is formed data and it's going to populate on lots of different forms in the system so we want to be blue no e steel photography and we are, uh if we don't know our industry weaken, choose here let's be uh this will help the forms that it's gonna populate for us we want to be a general service based business rental repair etcetera let's look advertising public relations aren't riding or photography does that sound like us my don't they make it easy for us to pick that I just want to say okay now and again the button is blue the company type now everybody if you don't know at this point in the seminar uh what you are we need to turn off your computer right now are we a single member llc? Are we a multi member llc? You all know the difference everybody watching online knows the difference you don't have to call anybody you know uh your tax I d number well I don't know what my tax I d number is what was that form that heidemann said that I shouldn't you lose that I should put in two places it's called my tax I d number well where did I get one out? Well I attended this seminar his course in creative live and I know that my employer I d number is on that form from the social security administration and it goes like this and do I have employees right now? No but I might in the future look at the flexibility I get and we hit continue alright it wants an address so let's give blue steel and address uh let's give up my studio address it wants a phone number it wants a website see how easy this is one two three continue it's creating our new company files so it's actually creating the database where all our accounts are going to be stored and that accounting files going to end with q b w I believe and it's going to put it in the intuit file you're gonna want to know where that isthe once it's created all right look here we are you've got a company file congratulations now add your info at people you do business with at products you sell ad your bank accounts etcetera I'm telling you guys here's what I want you to do skip that I am giving you permission to skip it let's just start working so here I am I met my home paige I've got a quick start center I don't care about that we're gonna close it we're going to keep it simple we're going to keep it real uh and relevant to an actual business because everybody that's here with me right now is already feeling uncomfortable do I really need this this sounds like so much can I just get one of the simple free things online and want to be okay well no there are no pink unicorns in quickbooks you have to actually do a little bit of work sometimes you work part time sometimes you work overtime so uh here we are so what's the first thing that our business has to do what's the one thing that's going to cause our business to fail if we don't adequately capitalized so remember if you go to my forms disc there is on that little creature just one minute a bill of sale and I just want to clarify their craig when you say your forms a disk the one that you're being ableto provide on your website correct yes if you want if you wantto pick up forms diskettes got some things that will help creative businesses get the job done things that we use every day and I'll have the link right at the very end the link where you can order that at great thank you alright bill of sale so we're gonna capitalize our business with the existing equipment so we pull up young bill of sale today is the what uh, first day in november happy november spring forward fall back this weekend twenty thirteen right? I'm just gonna I'm just gonna do this ugly uh the seller who is the seller craig heidemann right? Don't delete this sales to whom I selling it to lorenzo yeah, I'm sorry. I'm I'm just on my mind went blank blue steel photography and what am I giving him? What do I have to give him? I'm going to give him a cannon uh mar ah five dame are three about a cannon twenty for seventy two hundred l two point a I s too yes and so forth and so on so you'd take your equipment bag and you inventory it and we put that on the bill of sale and we sign this, uh, right here. We don't have to have it notarized at all in my opinion, but you'll name right there printed out, and now what does our company own? It owns some camera equipment, right? So now that our company owns some camera equipment, we have to account for that. So we're gonna account for that by diving in here and creating some accounts and quickbooks. So when we capitalize the account, we're going to go back into quickbooks right here, and we're going to, uh, make an entry, and what we're going to do is we're gonna receive some assets. Now, we don't have any cash, correct? We don't need cash to buy anything with we're getting these for free, so we go to lists charter accounts, all right? And we'll make this a little bit bigger so everybody can see it. And remember, I said we had assets, uh, liabilities, income and expenses. Those are our main items. Members equity. Do we have a member here and our llc members equity? We click on that right and that's a report. So we know that members equity is the account that we're gonna put our camera equipment in right? I mean, that's what that's where it's coming in? So we're going to we want this member's equity number after we're done making our first accounting entry, do we want it to go up or do we want it to go down? We wanted to go up now if we make an entry and it goes down and instead of up, I'm going to show you how to fix that. All right? So we have our company here and we can come down here to a little concept now we're going to get sophisticated right off the back because this is super easy to do make general journal entry. Now, this is the big general journal of our company and bob smirking because he knows how much damage you can do to a company in the general journal, but I'm taking you right here and we're going to make too accounting entries and next to each one his debit and credit and that just means it's either going upper it's going down so we know there's a member's equity account, right and look, I type member and it pops up members equity is coming up let's try credit first I'm not even smart enough to know which side to put it in, but I know how to check to see if I did it wrong okay, so don't even sweat it. You just have to know how to check your work it's like math in high school how much is my equipment worth? Anybody want to throw out a number? What's my one of my capitalizing this business with the camera equipment will you think six grand? Yes, six thousand works let's put six thousand in here. Now remember our balance sheet guys, I erased it, but everything has to equal so if members equities going up six thousand. Okay, what else has to go up? Six thousand and asset account, right? We don't even have an asset account for cameras and equipment yet maybe let's. See if we do well is type equipment there's equipment rental that's not what we want was type camera no let's, create camera let's create a camera equipment. I can't watch this camera equipment. Look, nothing pops up, but right underneath here is a handy little what? And new okay, I'm not even gonna answer this internet. Which button do I press? Is this an income account or isn't isn't an expense account isn't a fixed asset. Is it a bank account alone account? A credit card account or an equity account, huh? It will on ly let me track punch one I think it's a fixed asset it's a major purchase feels like a major purchase when you go spend money at being h doesn't it? Yes, it does. Any other account types? I mean, you can have other income, etcetera, other current asset. I'm gonna call it a fixed asset because it's going to stick around for a while. You just click the blue steel, continue button what's the account name we're gonna call it camera equipment about cameras and lenses that sound reasonable. You can put descriptions and notes and opening balances let's, just save in clothes. And now look at my accounting entry. Quickbooks lets me make this because it balances. Do you see how it balances? What happens if I were to put five thousand here? Quickbooks is going to carry this thousand bucks down. It's not let me out of here until I assign an account for that. All right, well, I made a mistake, right? Click. Um, actually it's edit, delete line or control delete it deletes the line control delete and I'm going to go back and fix that and put my six a thousand bucks in there. Seems like it's in balance, right? You're about to post to the retained earnings and members equity. Okay, that's, fine save and clothes okay, now, let's, see if I've done anything good, members equity six thousand bucks eleven one thirteen and it shows a current balance of six thousand bucks. I must have put it in the right side. If that were negative, what would I have do to fix that? You go back and switch put the six grand in the dab it instead of the credit side in it, it changes whether numbers are positive or negative. So there's no worries. We now know that there is a six thousand dollars balance in it. Now check this out. See how it's an accrual basis report customised report let's, change it to cash and we were going to change that in the company settings in just a minute. And I have to refresh this in order for it to show up close that us and I've got six grand in there. Well, what else do I have? Let's go to my balance sheet? I don't see what what changes reports company and financial balance sheets, standard six thousand members equity six thousand lenses it equals we just don't serve high into counting jim, and it doesn't even feel like I've left the parking lot. It's not too difficult, is it? Rocket mail our businesses capitalized. Let's get some cash. First of all let's here's where you adjust your company preferences at it preferences general um accounting, uh company preferences um blah blah, blah so this allows you to to make some general adjustments with your company we can come down here to the general company preferences and we can tell how we want to see decimals and minutes we can talk about art checking account we could talk about our bills when they're due let's say how much time do you want to give your clients to pay lorenzo about thirty days thirty day sounds prove these antennas pretty quick bills or do thirty days afterward see, I've made some changes and it's going to carry that through the whole program it's so easy edit preferences counting jam pony all right let's go to reports and graphs here it is so under the reports and graphs basis I don't want to have to keep going in there and changing over to cash basis accounting so you go to edit preferences reports and graphs and then just click the little cash radio button and then say okay now hopefully that will solve my report issue all right, so let's let's put some money in the company let's come back to company well, first of all, let's uh let's create a bank account bank account uh use register and look, we don't have a bank account to put it in do we cancel? Go home banking check register it doesn't give us one we don't have a bank account set up yet doing in order to make a deposit and I just clicked the record deposit icon you need to have a valid bank account would you like to create one now yes I would love nothing more what is the name of our bank account? It is the washing tio how about creative live checking all right and you can put your bank account number in here because this you can on this when you log in you can you can pay money with e c h directly out of your account using quick books and you can get payments from your clients directly into your bank account using ea ch is it e a ch routing one, two, three, four, five, six seven eight nine the routing number one and uh uh tax line mapping that's fine saving close. All right, there it isthe now I have a bank account is too creative live checking account how do I find it? You'd go to banking. You can either write checks from it with the wright checks button look and if I have multiple bank accounts I can add another one right there. Maybe I have two bank accounts and it's just simply picking the one that you want if there's not one there that you see you just add a new one it's super easy and you write a check well, before we can write checks my dad told me a long time ago you need to have some money in your account, right? And I've met some of my photographer brothers and sisters that haven't learned that rule yet we're going to actually invest some more money in our business and that's called capitalization so we have saved how much money did we save lorenzo? Thirty thousand dollars thirty grand so how do we do that? Let's? Just come back to company uh make general journal entry now we've already done this once this is going to go much faster look at auto numbered this and if I want to see how that which side to put it on click on the back arrow members equity six grand so I know to make members equity go up it needs to be in the credit column to make cameras and lenses go up. It needs to be in the debit column. It won't let me put it in the wrong one actually, but we're doing this today so we just click knew its entry to members equity that's the account it's going up thirty thousand now listen, what account isn't going in on the other side of the balance sheet mallory what account isn't going in? Oh she's thinking about it very is returning in communication with people it's gonna go oh, bob says checking bob says checking and what's the name of it. Creative live checking look, I start to type c r a t there it is. Hit the enter button and guess where that money is going to show up. So click the blue steel saving new button uh, okay. And it's gone. So I'm gonna close that window now, when I go back into my bank my my balance sheet, which is my tester I could always go back to the balance sheet for a tester report company and financial um, balance sheet standard. Oh, my goodness. Look at that now, how much do I have in my checking? Thirty grand? How do I know it? I don't have to go to my checkbook register to see how much in it is, innit? It's already sending it to the balance sheet, the balance sheets like my, uh, my instant checkup list for the health of my company. And if I double click on well, I'm sorry, but if I go to banking use register in the account is creative. Live checking. Look what it did. This is my checkbook register. I'll make it bigger. It shows that today I deposited thirty grand in my bank account. How about that now I can write checks directly from the register if I want to or you can use the graphic interface the write checks to do it it doesn't matter how you want to write checks so now we've got a real company that owns a camera in it owns a lands and it's got some cash now let's let's be let's be really what are we missing? We don't have any memory cards okay, so let's go get some memory cards how we're going to do that um let's write a check to be n h to buy some memory cards okay so let's say we've ordered it online being h is going to let us pay by check so we go to banking write checks pay to the order of now this is a vendor remember we have vendors and they want to know about our bend so we go toby in h photo video and it's not in the name's list well that's because I'm a new company let's do you can either do a quick ad where we'll just add the name or we can set it up let's take some time and set it up is this a vendor a customer and employee or another manner you didn't need me to tell you that um uh address info let's go ahead and put in some info what's the new york area code teo to tuo to one two three four five six uh the main thing that I like for the vendors email interface and quickbooks is wonderful always included email because it'll allow you to send statements to him it'll allow you to send letters to him you khun generate letters and quickbooks so we need to put in info at what is it b h photo dot com there it is and just say okay so that'll be good enough for today let's get some fancy sand as one hundred twenty eight gig by superfast video in out just let's spend five hundred bucks on let's get a lot now look what now this is where we keep track of stuff you have to classify it as an account in order to know what you're spending your money on so if I just put in five hundred dollars it might just be a cz likely has been manicures and spa services is computer services we have to tell the irs what we're buying or tell ourselves what are by it so let's call what do we want to call that way could make his many accounts as we want we can you can if you're you know my my producer aaron he is very detail oriented he would have thousands of accounts for everything he'd have brown media cards he'd have read media cards I'm a little bit more general I might call it medium cards used bob's going pretty general he's saying photographic equipment and supplies I want to keep it simple for you guys let's call it photo uh because we're going to expense it is a media card an asset or isn't an expense it's an interesting question, isn't it? They don't last forever we don't really depreciate him I like expensing them right away so let's just call it a photo equipment photo supplies you like that sounds general supply sounds like it's something that you we go it's not here so when I hit enter it says its not there let's set it up now you're gonna this is our second account we're set third account we're setting up it's easy um zoe income or expense it's already picked it just say continue um you khun you can write out a description if you want to tax line mapping you can you can actually assign it to attacks like we're going to skip that just do saving clothes so now it says photo supplies all right saving clothes or saving knew we might want to write another check and now we're on to our next check oh look at my checking account balance what's happened it's gone down five hundred bucks so I've taken my cash right and I have moved it um somewhere else so let's look at my balance sheet and see what happened on my balance sheet reports company and financial balance that's balance sheet detail I want I want the balance sheet standard so we're going to go back teo company and financial balance sheets standard now I've got twenty nine five in my account I still have a six thousand dollar camera but my income has gone down see what's that the income account when we spend our money our income goes down when we don't spend our money our income stays the same when we get paid what interest do you think we're going to see in our income account we're gonna go up hopefully so this is what we're looking for I mean you're learning the language of accounting our net income is down five hundred because no one has paid us anything yet now don't worry blue steel is going to get a gig blue steel is going to get a rockin fashion gig and we're going to make some money but right now I just want you to see how quick books is talking to us and what we're learning from the very basic things that it's saying so we know that we have not made any money we still are positive in our cash we could go have a rockin photo rock star party with our thirty twenty nine five that's left in our checking account but is that going to increase our income you're going to do a bit to help our income it's just a expense so spending money to have fun that if it doesn't make money it's not gonna help this income account so we need to watch the income account remember larry landscaper? He his income account was negative too. So he's spending money not making enough money. Ok, so let's, go see another report that I love and it is called the company and financial profit and loss standard. Check this out. How much remember our income was negative five hundred. The profit and loss report tells us how he got there. Now we're going to come back to this report, but it will never be more simple than it is right now. It says we have lost five hundred dollars, even though we've got twenty nine five in our account, we have no tax liability. All we've done is spent five hundred bucks. We don't have to pay tax on the cotton picking thing. Life is good, we're down five hundred dollars, but we've got a camera. We've got a lens, we got a memory card, we got an l l c. We got a text id number. We get an operating your groom with a cool forms disk from craig heidemann, and we've got the motivation and inspiration to march forward to make blue steel photography worldwide.

Class Description

Ready to turn your creative side project into a thriving business? Join Craig Heidemann for an introduction to the business and accounting principles every creative professional needs to know. 


In this class, Craig will take you step-by-step through the process of setting up, running, and growing a small business. You’ll learn how to use QuickBooks to manage your finances, including managing client contracts and invoices. Craig will also help you navigate the potentially-confusing tax, legal, and copyright issues surrounding small businesses. You’ll also learn how to contract and/or hire people to do the tasks you can’t do yourself. 

Whether you’re just starting out as a business owner or you’re a longtime entrepreneur ready for a refresher course, this course will give you a roadmap to business success.

Reviews

a Creativelive Student
 

Excellent course and subject topic. Mr. Heidermann is a great teacher! Wonderful explanation, clear and concise details, humorous delivery, he kept me engaged the entire time. I truly had fun watching and learning during this course.

a Creativelive Student
 

I'm literally fresh off the boat, as the saying goes, having moved back to the US after decades of living abroad. I have the photography down (in some measure due to the instructors and courses here at CL), but being new to the business of photography in this environment I was rudderless. This course helped answer all my initial questions and put me on the way to getting established in my region... and beyond! Craig makes legal issues almost fun with his jocular, engaging style. Thanks so much to Chase and the people at CL for knowing what courses real working photographers need.

Andrew V Gonzales
 

This class is amazing (as is the Instructor). Funny, real, and to the point, Craig has a great way of making these aspects of business MUCH less intimidating. Still very applicable even in 2016. Loved it!