Top 5 Ways A Business Owner Can Get The Most Out Of Quickbooks Online

As the old saying goes, if you can’t track it, you can’t improve it. Quickbooks Online embraces this notion by providing you with profit and loss statements, so you can track what’s coming in and out of your company bank accounts.

After opening Quickbooks Online, scroll to the left-hand column to click “reports.”  Your starting screen doesn’t matter.

Be mindful that P/L statements are relevant to a specific time range, so select the period you want to analyze.

Now let’s get into the core components of P/L statements and reports:

Income

The income-based items you’ll see will present themselves as positive or negative. 

For instance, if you’re a content creator and clients pay you for blogs, videos, etc., positive numbers appear for any content-based income. Alternatively, any discount you’ve given your clients will display a negative value as an adjustment.

Transactions

You’ll see that each line item is clickable. 

If you click on the dollar figure lined to the item entitled Services, Quickbooks Online takes you to a transaction report. 

Know that transactions aren’t invoices. Instead, you’ll likely find portions of various invoices connected to the Services account. 

Tracking your transactions in business accounting allows you to put on your detective hat on top of your business ownership hat. It helps clarify what money is connected to which account, and your P/L reports give you a breadcrumb trail to locate from where your funds originate.

Expenses

You can use the same method highlighted above to determine expense sources. 

Once more, scroll to and click the dollar amount to open the Transaction Report. You’ll see all the relevant information, such as:

• Account name
• Account type
• Transaction date
• Type
• Credit card type
• Balance owed
• Amount

Remember to input supporting documents like receipts and invoices. 

Furthermore, remember to write a description. These will turn up when you click on the dollar amounts. Know that your accounting software can only be as valuable as your inputted data.

Using Logical Categories For Your Expenses

Keeping your information ambiguous will make your life far more challenging in your P/L reports. 

You’ll notice that if you don’t logically list expenses, the account will be “miscellaneous” and contain whichever dollar amount is in it. It could be thousands of dollars that don’t seem to have a source at first glance.

Your P/L reports aren’t meant to give you a broad, annual bottom line. They’re supposed to guide your strategies and decisions. Accounting information will help with that if you logically categorize your expenses.

So, click the dollar amount, pick one transaction, and update the category in the invoice to display the sensical expense placement. This process makes the once miscellaneous transaction detail more specific.

Long Term Analysis

Click the dropdown “display columns by” and select months in your P/L report. Doing so allows you to flag anomalies.

For instance, you’d know if you pay $150 in monthly insurance premiums, which will turn up in all monthly columns. 

You can then notice, for instance, if that premium doubles one month. Or, it might not be there at all.

Click into the expense to investigate why the additional or non-existent cost did or didn’t appear in your account system. One common occurrence is owners accidentally paying with their personal credit cards.

Your P/L reports can help you be more focused and specific with your goals. It could be to gain market share over the past 12 months or grow one particular income source, for instance. 

Whatever your goal is, Quickbooks Online P/L reports offer a snapshot of how you reached (or didn’t reach) these objectives.