QuickBooks allows you to delete transactions. But you should not. 
 
Because your accounting figures will differ from your printed reports. And more seriously, maybe your GST returns as well. 
 
You should do the following:
 
  1. Leave the original transaction alone (especially when the month end has passed).
  2. Treat the bounced cheque as a separate event and pass a reversal journal to account for it (see table below).

 

How to reverse a bounced cheque

When you receive/issue a replacement cheque, record the new entry using Receive Payments or Pay Bills accordingly. 

 

Let's now explore further a special function called "Record Bounced Cheque" in the newer versions of QuickBooks (Canadian desktop versions).

Record Bounced Cheque in Receive Payments Screen

Record bounced cheque in Receive Payments

This function goes beyond passing a reversal journal to account for a bounced (or dishonoured) cheque.

To understand the concepts, let's go through a simple customer payment cycle.
 

1. Customer has one invoice of $4,000 outstanding in which they made a partial payment of $1,000.

Record bounced cheque in QuickBooks
 
2. The cheque bounces. In QuickBooks, go back to the Receive Payment screen and use the Record Bounced Cheque to key in the date that the cheque is bounced. (Ignore the Bank Fee and Customer Fee at the moment.)
 
Record bounced cheque in QuickBooks
 
3. The same Receive Payment screen is now marked "BOUNCED CHEQUE." Let's see what happens here:
 
Record bounced cheque in QuickBooks
 
3.1 First, QuickBooks removes the matching between the customer payment and the invoice. This means that the invoice becomes unpaid. However, the Accounts Receivable is not affected because the customer payment is not deleted, just unmatched:
 
Record bounced cheque in QuickBooks
 
3.2 Secondly, QuickBooks auto-creates a journal to reverse the customer payment (on the date that the cheque is reported bounced):
 
Record bounced cheque in QuickBooks
 
Effectively, on the date that the cheque is reported bounced, the customer outstanding balance is also reinstated :
 
Record bounced cheque in QuickBooks
 
3.3 To wrap up the matching, the customer payment is matched against the reversal journal. In this way, on the date that the cheque is reported bounced, the customer's Accounts Receivable breakdown correctly shows only the unpaid invoice.
 
Record bounced cheque in QuickBooks
 
4. Now, let's look at the effects of the Bank Fee and Customer Fee boxes.
 
Record bounced cheque in QuickBooks
 
As QuickBooks matures, better features are added. Contact us today to explore how QuickBooks can help you.

 

 
Published in News
Wednesday, 17 May 2017 14:40

How to Backup and Restore QuickBooks Data

Consider for a moment the reasons why we don't backup:
 
  1. No time.
  2. Forgot.
  3. It won't be that bad.
  4. I don't know how to.
 
For the first three reasons, I'll leave it to you to settle with your inner self. 
 
I'll try to help here with the fourth one by looking at two related procedures: backup and restore.
 
Backup and restore data

Backup

 
Before doing a backup, let's clarify two key decisions that you have to make along the way:
 

1. What is the backup file type?

 
When you create a backup from the File menu in QuickBooks, you see two similar sub-menus: 
 
  • File > Create Backup
  • File > Create Copy 

Create Backup proceeds directly to let you create a backup file whereas Create Copy adds one more step to let you choose different backup file types. 

So, what are different file types?
 
QuickBooks backup copy QBB and portable file QBM
Note: The file type called accountant's copy is an advanced feature where you can share your file with an external accountant using the same version of QuickBooks to merge in adjusting journal entries. This is outside the scope of this article.
 
In short, one is a full backup while the other a partial backup, recommended to be done as follows:
 
  • Regularly backup your QuickBooks data as a QBB file
  • Use a QBM file when you need to share only financial data (because the file size is smaller). 

 

2. Where to save the backup copy (QBB) or portable company file (QBM)?

 
As a good practice, save any backup file on an external storage medium, e.g., portable hard disk, USB flash drive. 
 
QuickBooks prompts a message should you set the option to save onto the same drive as the working data file that you're trying to backup.
 
QuickBooks backup - Save to a different drive
 
Now, let's go through the backup procedures:
 
QuickBooks backup procedures
 

Restore

 
Restoring data is like travelling back in time to the moment when you did your last backup. 
 
In restoring data, most people are confused by two questions. Let's review them first:
 

1. Where to restore to? 

 
In other words, where do you want to store the restored file?
 
First of all, where does QuickBooks store it's data file? To understand that, you may do this simple exercise now: In QuickBooks (with a company file opened), press F2. 
 
You'll call up a Product Information page like this:
QuickBooks company data file information
 
Here, you'll see some crucial information about your QuickBooks and data, including the (Data) File name and location.
 
Most people don't realise the data file location was specified when you, or your predecessor, first created it. 
 
Read about How to Create a New Company Data File in QuickBooks here.
 

2. Do you replace? 

 
For a new or reformatted computer, you don't have any data file in the computer and this question does not arise. 
 
However, should the original company data file be still present in the computer, but damaged (which is why you're restoring a backup), this question confirms whether you want to overwrite the original (bad) data file.
 
Remember that restoring data is travelling back in time to the moment when you did your last backup. Therefore, whatever information from that moment until today, you have to re-key. 
 
This means that you have to be sure that you're overwriting a bad data file.
 
With this understanding in mind, let's now now go through the restore procedures as follows: 
 
QuickBooks open or restore company menu
QuickBooks restore data file procedures
 
As computers get more connected, data loss is not just caused by hardware failures but also virus and malware infections. Is your business at risk? Check up Panda Security with special pricing for customers of QCOM BizSolutions here.
 
 
 
 
 
 
Published in News
Monday, 18 April 2016 10:14

Intuit QuickBooks Premier 2017

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Published in QuickBooks Canada
Monday, 18 April 2016 10:13

Intuit QuickBooks Pro 2017

Use Intuit QuickBooks 2017 to organize your small business finances

  • Organize your business finances all in one place
  • Easily create invoices and track sales and expenses
  • Get reliable records for tax time. Easy to set up, learn and use (New to Quickbooks?)
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Published in QuickBooks Canada
Wednesday, 12 August 2015 17:18

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Wednesday, 07 August 2013 13:26

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