Reassigning Products And Services In QuickBooks
For some, Quickbooks can be an intimidating platform to use, especially without any formal training. In today’s blog, Waterford Business Solutions, the best bookkeeping company for businesses in the service industry, will help you learn how to reassign products and services using Quickbooks.
When companies use QuickBooks and grow their company, there is one tool that can really help them analyze sales, which allows for even more growth. You always hear that you should review your key financial statements, profit and loss and your balance sheet, on a monthly basis. However, we can gain a better understanding of our companies’ sales by setting up a General Ledger (Chart of Accounts) for different sales categories. For example, we might want to look at our sales of labor products versus our sales of actual products. This kind of bookkeeping service goes beyond tracking sales by employee or location or class. This is tracking a specific sales group on our standard financial statements.
We do this by first deciding what we want to track, then we create an account for that specific sales group. In order to do this, we’ll navigate to our chart of accounts and select “New”, and then we’ll create a new income account for Design Services, Maintenance, and Landscape.
This will allow us to map our products and services to those accounts in order to review them in our financial statements. Here at Waterford, we find it easier to have one generic Sales account or Income account with all sub income accounts nested under that, just like in the pictures below. This allows you to track all sales together and then break it down by more specifics.
Next, we will go to our Products and Services, located under the Sales left hand navigation bar, and click edit on a product and service. This will now allow us to assign an Income account for that product and service. We will then assign a new income account for our Service. In doing this, a check box will appear asking “Also update this account in historical transactions?” We’ll want to answer yes to this. This will then move any and all uses of this product, even information from 5 years ago, into this new income account so that you can view all historical use of that product in your financial statements. You can then make comparisons on these items for the long term, not just starting from when we transition over to the new account.
Now not everyone is going to want to use this method, and some might argue that they can pull sales reports on products by themselves, which is true. However, not only does the method we just described allow you to track each product and service like you can through a product and service report, but it also allows you to compare more generic categories month over month through your financial statements, which are more important than just looking at your product sales. We will be discussing why this is important in a later post. Ultimately is this something that you definitely need to do? No, this is an advanced option that will allow you to have a deeper understanding of what is going on in your company and how to help your business to perform better.
When you need help with Quickbooks or bookkeeping services, then Waterford Business Solutions is the company for you. We specialize in bookkeeping services for service industry companies. Learn more about our expert bookkeeping services, get to know our commercial accounting company, or contact Waterford Business Solutions to answer any questions and to get started with your custom bookkeeping services today.