Quicken for Contractors

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Quicken for Contractors explains how to use Quicken, an affordable, easy-to-understand computer program published by Intuit. It shows step-by-step how Quicken can work in the builder's office, putting accurate bookkeeping within easy reach. This manual does not include the Quicken program, but has instructions and examples, with onscreen "pictures" of familiar forms like checks, deposit slips and time cards that you can create with Quicken.


Weight 1.4800
ISBN 1-57218-043-9
Page Count 230
Author Karen Mitchell, Jim Erwin,Craig Savage and Rex Underwood
Publisher Craftsman Book Company
Dimensions 8-1/2 x 11

Most builders, contractors, and remodelers came up through the ranks, learning their craft "in the trenches." They know how buildings go together, but office management skills like bookkeeping, accounting, payroll and job costing are often a new, and dangerous, challenge.

Quicken for Contractors explains how to use Quicken, an affordable, easy-to-understand computer program published by Intuit. It shows step-by-step how Quicken can work in the builder's office, putting accurate bookkeeping within easy reach. This manual does not include the program, but has instructions and examples, with onscreen "pictures" of familiar forms like checks, deposit slips and time cards that you can create with Quicken.

Even if you only have a few minutes a week, this book will help you use Quicken to set up a basic checkbook system that will quickly tell you your cash position and job costs. You'll learn how to set up your financial files and create valuable reports, including profit & loss statements, payroll reports and job cost reports.

The companion diskette included with the book consists of a sample construction company that you can use as a tutorial, or as a template for you to plug in your own data.

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Contents

Introduction, vii

1. The Right Tool for the Job, 1
Quicken Overview, 1
Check Register, 2
Accounting Methods, 4
Budgets (Estimates), 5
Checkfree and Intuit’s Online Banking, 5
Investments, 6
Links to Tax Software, 6
Hardware and Software Considerations, 7
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Hardware, 7
Software, 8
The Role of Your Account, 9
What You Get in This Book and the Companion Diskette, 10
Custom Quicken Data Files, 10
Sample Forms and Templates, 11

2. Using Quicken Categories, Accounts and Classes, 13
Installing Quicken, 13
Using the Quicken Data Files, 13
Copying the Quicken Data Files, 15
Using Categories and Supercategories, 15
Types of Categories, 15
Category Lists for Quicken, 16
Working with Categories, 26
Supercategories, 32
Accounts, 35
Using Quicken’s Online Banking Features, 36
Creating New Accounts, 43
Modifying Existing Accounts, 63
Deleting Existing Accounts, 68
Classes (Jobs), 68
Creating New Classes, 69
Modifying Existing Classes, 70
Deleting Existing Classes, 71

3. Customizing Quicken, 73
Quicken Program Options, 75
QuickTabs Tab, 75
General Tab, 79
Settings Tab, 80
Register Options, 82
Display Tab, 82
Miscellaneous Tab, 84
QuickFill Tab, 86
Check Options, 88
Checks Tab, 88
Miscellaneous Tab, 89
QuickFill Tab, 90
Report Options, 92
Account Display, 92
Category Display, 92
Default Report Date Range, 93
Default Comparison Report Date Range, 93
Skip Create Report Prompt, 94
Use Color in Report, 94
Quick Zoom to Investment Reports, 94
Decimal Digits of the price and Shares, 94
Graph Options, 94
Use Patterns Instead of Colors, 95
Create All Graphs in Separate Windows, 95
Draw in 2D, 95
Show the Customize Bar, 95
Reminder Options, 96
Reminder Options, 96
Billminder Options, 97
Internet Connection Options, 99
Prompt me to update Quicken 98 on startup, 99
Prompt me to close my connection after XX minutes of no activity, 100
Keep my Internet connection open after updating Quicken 98, 100
Save Desktop, 100
Save Desktop on Exit, 101
Save Current Desktop, 101
Customize Iconbar, 101
New, 102
Edit, 103
Delete, 103
Reset, 103
Show Icons, 103
Show Text, 104

4. Entering Transactions in Quicken, 105
Writing Checks, 105
Assigning Classes, 107
Writing a Check to Pay a Job Expense, 108
Printing Checks, 110
Tracking 1099 Venders and Subcontractors, 116
Entering Deposits, 118
Customer Payment on Invoice, 118
Customer Deposits, 120
Customer Advance on Job, 121
Invoicing, 122
Entering Payroll Transactions, 122
Using Payroll Services, 123
Using Intuit’s QuickPay Plug-In, 123
Entering Payroll Transactions in Quicken, 124
Using Scheduled Transactions, 124
Creating New Scheduled Transactions, 124
Modifying an Existing Scheduled Transaction, 126
Deleting an Existing Scheduled Transaction, 126

5. Job Costing and Estimating with Quicken, 131
Estimating (Budgeting), 132
Setting Up a Budget, 133
Job-Cost and Budget Reports, 135
Job-Cost Reports, 135
Budget Reports, 139

6. Using Memorized Transactions, 143
Why Use or Create Memorized Transactions? 144
Working in the Memorized Transaction List Window, 145
Using a Memorized Transaction, 146
Memorized Transactions Included on the Companion Diskette, 147
Special Transactions, 148
Deposits, 149
Non Job Payments (NON JOB PMTS.), 152
Job Vender Payments, 153
Memorized Transactions for Payroll Functions, 157
Creating a New Memorized Transaction, 165

7. Using Memorized Reports, 169
Memorized Report Basics, 169
Memorized Reports Included in the Quicken Data Files, 172
1099 Detail Report (Vender 1099 checks), 175
Budget Report-Job___(Budget-vs-Acctual), 177
Cash Flow Report by Month(Summary by Category), 178
Income & Expense by Quarter (Summary by Category), 180
Job Detail Report-Job___(Job Income_Expense), 181
Job Summary Report-Job___(Activity by Month), 183
Jobs Summary (Activity by Job), 185
P/R Expense Report (Summary by Month), 186
P/R Withholding Report (Summary by Month), 188
Payroll Employee Report (Wages_withholding), 189
Payroll Expense Report (Summary by Employee), 191
Payroll Tax Report, 192
Transaction History by Name (All transactions), 194
Unprinted Checks-Detail by Job (Job unprinted checks), 195
Unprinted Checks-Detail by Vendor (All unprinted checks), 197
Unprinted Checks-Summary by Vendor (All unprinted checks), 198
Wage & Burden Allocation (Detail by Category), 199
Creating a New Memorized Report, 201

8. End-of-Month Procedures, 203
Reconcile the Checkbook(s), 203
Ensure Accuracy of Data Entry, 208
Printing Financial Reports, 208
Profit & Loss Statement, 210
Profit & Loss Comparison Report, 212
Balance Sheet, 214
Job-Cost Reports, 214
Back Up Your Data File, 215
Working with an Accountant, 216

9. Backing Up Your Quicken Files, 217
Backup Strategies, 218
Archiving Your Quicken Files, 219
Archiving Data Files, 220
Starting a New Year, 220
Conclusion, 221

Index, 223

Introduction

Quicken is truly a good fit for the construction office. If you are a contractor, builder, or remodeler, you have much to gain by using this software tool to help manage your business finances. But Quicken has been created for generic financial use, which means you have to customize it to reflect the business practices commonly used in the construction field. That's why we've written this book and provided the accompanying diskette-to give construction professionals like you the tools to tailor Quicken to your special needs.

Why You Should Buy This Book

Buying this book signals your ongoing commitment to improve the management and operation of your construction business.

Unless you're a contractor or builder who has the good fortune of being the only game in town, you're forced to cleat with the realities of surviving and prospering in a competitive marketplace. Tougher quality standards and a smarter buying public place ever-increasing demands on builders and contractors. It is this competition that determines the price at which your product or services will sell, not you. You do, however, have a great deal of control over what it costs to produce and deliver your product or services. Controlling your costs through informed and intelligent decision-making is the key to maintaining profitability and protecting your investment.

The most important tool you can use to control your project costs is an efficient job-costing system. Job costing provides a way to track and report on the actual costs of a construction project as it progresses. It also allows you to compare your actual costs with your estimated costs. The basis of an efficient job-costing system is a well-designed, accurate, computerized estimating program coupled with financial management software that is properly fitted to your business.

This book is a working model for setting up such a system using Quicken. It is written to help you get up and running quickly, and to provide you with the vital controls that can make the difference between success and failure in your construction business. We've made every effort to present this material in a straightforward and easily understood manner, without using the usual ledgerspeak and technobabble.

You don't have to spend a great deal of time doing your bookkeeping; you just have to spend the time well. This book will show you how. You'll learn how to set up the program correctly so that you can easily get meaningful information from your reports. For example, we'll show you how to set up jobs, job divisions (the specific phases of a job, such as concrete, framing, or site wiring), and job budgets (estimates). Then we'll give you step-by-step instructions on how to print a report that gives you the estimated versus actual costs for each job, broken down by job division, if needed. With this kind of help you'll soon have control over your financial matters without spending your life at the computer.

Quicken in Construction

Why use Quicken? We believe it offers the best combination of power and simplicity available today for the small-volume builder or general contractor. The importance of simplicity cannot be overstated.

What is Quicken? It's an entry-level financial management software program for Windows and Macintosh computers. Quicken is a registered trademark of Intuit. It's a good alternative to the mystery and complexity of traditional accounting software. Instead of using technical accounting jargon, Quicken uses terms that you're familiar with. Its format is user-friendly and straightforward. It allows you to work in a way that is comfortable, familiar, and understandable. Using Quicken to capture and calculate all your daily transactions, including checks and deposits, is much faster than entering and calculating everything by hand. Quicken can summarize your transactions, presenting them in reports and graphs that give you a good idea of where you stand financially. You can record your assets (equipment, cash-in-bank, vehicles) and liabilities (truck and construction loans, payroll taxes), as well as track income, job costs, and overhead expenses. Quicken gives you quick access to critical business information that you never thought possible.

What Can I Expect to Learn from This Book?

We've written this book because we've watched builders struggle with their bookkeeping and accounting systems. Even though Quicken was written to be easy to use and understand, the complexities of construction accounting make this book necessary. If you follow the setup procedures we've laid out in this book, you can expect your bookkeeping and accounting systems to give you back information that will make your business more productive with less effort.

By following along with this book, you'll learn:

  • How to set up easily manageable cash-basis categories and accounts in Quicken.
  • How to create, edit, and use classes. (In Quicken, a new job or project is set up as a class.)
  • How to set up a simple and effective job-costing system.
  • How to create and use budgets.
  • How to create and interpret reports that are designed to keep you in touch with the vital signs of your business.
  • How to process payroll.
  • How to prepare interim financial statements when required by a tender or new supplier to determine your creditworthiness.
  • Tips and tricks for getting the most out of Quicken.

If you're willing to make a small but regular, disciplined investment of time and effort to understand and apply the techniques and methods covered in this book, you'll see measurable and continuing improvement in your accounting skills. In addition, you'll gain the personal and financial rewards that come from working not just harder, but smarter.

About the Authors

Karen Mitchell has 15 years experience as a general contractor and finance consultant. Her company, Online Accounting, helps construction companies around the world computerize their accounting using Quicken and QuickBooks. Ms. Mitchell has an extensive background in construction accounting, frequently publishes articles on computerized business management in leading construction publications, and, with Craig Savage, co-authored the popular book Construction Forms & Contracts.

Craig Savage has been a general building contractor for over 25 years, and now does consulting as a specialist in computer solutions for construction companies, helping builders move beyond "shoebox or dashboard" accounting to more organized and accurate systems using Quicken or QuickBooks Pro. His concepts of bookkeeping and job costing are easy to understand and implement, and his step-by-step explanations make setup and reporting simple. He has written numerous articles for construction magazines, edits two newsletters, and is associate editor for the Journal of Light Construction. He is a regular speaker at builder-oriented conventions and conducts seminars dealing with construction management. He is the author of Rim Carpentry Techniques and co-author of Construction Forms & Contracts.

Jim Erwin is a partner in several second-generation family-owned construction companies in upstate New York involved in land development, residential construction, and light commercial construction. He is an active member of the National Association of Home Builders and has written articles on the use of computers in construction for a variety of construction magazines. Mr. Erwin is also the creator of GC/Works, a full-featured software solution for the construction industry that uses Quicken or QuickBooks Pro as its basis.

Rex Underwood is a general contractor, designer, programmer, and journalist with 20 years experience in the construction industry. He is the owner of the Rex Underwood Design Group in Santa Barbara, California, specializing in high-end custom residential and light commercial construction. Rex is a writer and associate editor of the Macintosh Construction Forum, Construction Business Computing, and Rural Builder Magazine, whose articles have enjoyed a readership of over 400,000 people worldwide. His speaking engagements, as well as his programming efforts, focus on construction office software integration and automation.

Quicken for Contractors
by Karen Mitchell, Jim Erwin,
Craig Savage and Rex Underwood

Most builders, contractors and remodelers came up through the ranks, learning their craft "in the trenches." They know how buildings go together, but office management skills like bookkeeping, accounting, payroll, and job costing are often a new and intimidating challenge.

But now, there are accounting programs that can turn your computer into a tireless, timesaving office manager/bookkeeper-one that doesn't make mistakes. Working with onscreen "pictures" of familiar forms like checks, time cards and deposit slips, programs such as Quicken put easy, accurate bookkeeping within your reach. Even if you have only a few minutes a week, you can set up a basic checkbook system in Quicken that will quickly tell you your overall cash position and individual job costs.

Since this program is affordable and easy to understand, thousands of builders, contractors, developers, subs, and remodelers already find Quicken one of their most valuable tools. But software programs, like nail guns, are helpful only if you know how to use them correctly.

This book and the accompanying disk can help you do just that. They contain step-by-step instructions for setting up your construction business using Quicken. First, the book helps you decide how best to set up your accounts, including checking, credit card, and even investment accounts. Then it walks you through setting up Preferences so you can quickly enter Jobs, Customers, and payments to Vendors. Finally, it will take you through the reporting process, showing you how to create these essential business reports:

  • Profit and Loss Statements
  • Payroll Reports
  • Job Cost Reports

Especially vital is the Job Cost Report, which covers perhaps the most important and elusive costs. They show if you are making or loosing money on each phase of every job.

To help you see how these programs can work for you, the disk includes preconfigured sample companies. Use these as tutorials, or simply drag the templates over onto your hard drive and begin to plug your data into them.

Quicken software was designed to be useful for any type of business. We've taken its usefulness a step further by making it specific to the construction trade and showing you precisely how to use it. You'll have the combined experience and technical know-how of the team of builders and consultants that compiled this book just for you.