Author Jess Stratton shows how to configure finance charges for overdue invoices. She goes through the setup, and then shows how to find out who owes finance charges and how to send them out.
- [Instructor] When your customers don't pay their bills on time, you can assess finance charges, which is a percentage of their outstanding balance. Before you can assess finance charges, you need to set them up in QuickBooks first. Select Edit from the top menu, and choose Preferences. Change to the Finance Charge section on the left hand side and click Company Preferences. The first thing you need to decide is what the Annual Interest Rate is going to be. That is the percentage of their outstanding balance. You also need to decide if there's going to be a minimum figure that is the minimum amount before QuickBooks will start assessing charges.
You can also decide whether there's a Grace Period. Then you need to tell QuickBooks where to track this income. I'll create a new account by scrolling up and choosing Add New. I'll give it a number following my number scheme, and I'll call this one Finance Charges. I'll click Save & Close, and now it's been created. I can also decide whether I want to assess finance charges on existing finance charges that are overdue. And then I need to decide if I'm calculating these finance charges based on the due date of the invoice, or when the invoice was created.
Finally, I'm going to select Mark finance charge invoices "To be printed". This way, when they're created, it will show up on my Reminders list and I'll know I need to print them out. Click the blue OK button, then I'll close out of the Customer area. And I now see that I have a new section in here called Finance Charges. I'll click the Finance Charge button and here I can see all my customers, their overdue balances, and what the finance charges are going to be. If I don't want to send them a finance charge to any particular customer, I can simply uncheck them in the view.
When I'm done, I'll click the blue Assess Charges button. The invoices are created, and because we've flagged them to be marked as printed, I can click on my Reminders on the top right hand side, click on INVOICE/CREDIT MEMOS TO PRINT, and here's where I can see the finance charge that was just created. In fact, I can even double-click on it and bring up the invoice and take a look around. You can see the description, the amount, and the invoice that it's based on and that invoice's due date.
It's a normal invoice, I can print it out or email it. As you can see, it doesn't take very long to set up finance charges and it's easy to track them and send them to your customers.
- Setting up a new company file
- Working with the chart of accounts
- Adding bank accounts and credit cards
- Adding service or inventory items
- Setting up sales tax
- Adding customer, vendor, and employee profiles
- Billing customers
- Receiving payments
- Recording deposits
- Handling refunds and credits
- Paying employees
- Sharing QuickBooks with others
- Running reports
Skill Level Appropriate for all
1. Navigate QuickBooks
2. Work with Company Files
3. Set Up Shop
4. Add Customers
5. Work with Vendors
6. Add Employees
7. Manage Day-to-Day Operations
8. Handle Special Cases
9. Administer Payroll
10. Manage Online Banking
11. Share QuickBooks with Others
12. Find Information Quickly
13. Run Reports
14. Manage Year-End Preparations
15. Customize QuickBooks
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