QuickBooks 2013 For Dummies

Recording Your Bills the Accounts Payable Way

The accounts payable (A/P) way of paying bills involves two steps. The first is a trifle on the difficult side, and the second step is as easy as pie. First, you record your bills. If you read the section earlier in this chapter on writing checks the slow way, you’re already familiar with using the Expenses tab and the Items tab to record bills. You need to fill out those tabs for the A/P method as well, if you want to distribute a bill to accounts, customers, jobs, classes, and items. If you read the first half of this chapter, some of what follows will be old hat.

After you record your bills, you can go on to the second step: telling QuickBooks which bills to pay. Then QuickBooks writes the checks. You print them. You mail them.

To make the A/P method work, you have to record your bills as they come in. That doesn’t mean that you have to pay them right away. By recording your bills, you can keep track of how much money you owe and how much money your business really has. QuickBooks reminds you when your bills are due so that you don’t have to worry about forgetting to pay a bill.

When you record bills the accounts payable way, you’re using accrual-basis accounting. I explain accrual-basis accounting in Appendix B.

Recording your bills

When a bill comes in, the first thing to do is record it. You can record bills through the Enter Bills ...