Have you used Quickbooks online for your business? Do you find it challenging to reconcile your field service company books to your bank statement? Does it seem like the numbers never match? You may want to avoid this task altogether, but without reconciled books, you will not have accurate financial statements. So you will not know the true profitability of your business.
The best way to make it easier to keep your numbers straight is by tracking all of the activity going through your bank account and reconciling your Quickbooks transactions to the bank statement every month. To achieve this you must record all deposits to your bank account in Quickbooks, as well as the expenses and purchases that were paid from your bank account. Here we will focus on the Deposits to your bank account.
You just got paid for that big renovation project!
You’ve sent the Invoice for a completed project and received the payment, now be sure to choose the Undeposited Funds account as the Deposit To account in the Receive Payment screen in Quickbooks Online. Using the Undeposited Funds account makes tracking transactions from your check register to the bank statement easy.
The Bank Deposit feature enables you to choose the payments held in Undeposited Funds and create a deposit that matches how it entered your bank account. If your deposit was cash and a few checks, select the payments that make up the deposit and be sure the totals match the deposit amount made at the bank.
Some construction companies you may have done work for only pay via some form of electronic transfer of funds. If you received an electronic payment to your bank account, you would need the customer’s remittance information. For multiple payments, receive the payments individually in Quickbooks Online and use Undeposited Funds as the Deposit To account. Then create a new Bank Deposit as mentioned above.
If the payment amount is for just one invoice, receive payment for the invoice, and choose your bank account as the Deposit To account. The payment deposit amount will match your bank statement exactly. This will help you breeze through your monthly bank reconciliation without frustration. Remember, QuickBooks transactions should match your bank account – if money is in the actual bank, this should be reflected in QuickBooks.
What about payments received from non-customers?
Using Bank Deposit, you can also record deposits that are unrelated to customer payments, such as vendor refunds or insurance claim proceeds. The bottom section of the Bank Deposit screen is where you will enter these checks. Let’s say you needed to return some hardware purchased for a job, and the vendor refund check just arrived. Add the Vendor name, the expense account you used when you originally purchased from the Vendor, and the check amount. If you deposited this refund check with other payments in a single deposit, you could add them here to match what you deposited in the bank.
Run your construction trades business effortlessly with Quickbooks Online
You will make the job of keeping your numbers organized much easier by following the steps to make your bank deposit amounts in Quickbooks Online match your bank statement. This will free up time that you can use to do things you enjoy! At Working Numbers, we help business owners in the construction trades with bookkeeping, sales tax, payroll, job costing, and advisory services. We understand the unique challenges you face while working in the field, and we have solutions for you. If your construction or home services business needs help –let the experts at Working Numbers get your books organized.