QuickBooks Online Software Simplified: The Dashboard and the Account Type

Michael Pignatelli
Oct 31, 2022

So you've just purchased QuickBooks accounting software. Now, you're trying to figure out the fastest way to learn how to make it work. The obvious go-to is the World Wide Web.

But sometimes, tutorial videos, forums, and software articles can leave you more confused than enlightened. So let Unloop make it simple for you. Put this article on a separate browser window, pull up your QuickBooks software and let us walk you through two of the most important things you must know: the dashboard and the account type.

Overview of the Dashboard

Before we get into the details of the account types, let's touch on QuickBooks’s dashboard first.

In every QuickBooks account you have, the dashboard will be your opening page. It visually presents your numbers in bar graphs and pie charts with numbers supporting them, giving you a glance at your overall business performance.

Here's what you can expect from your QuickBooks dashboard.

Cash Flow Section

The largest section on the page is the cash flow graph. This represents money that comes in and out of your business in a given accounting period.

The vertical graphs for cash in and cash out will be presented per month, side-by-side. So you can easily see how your net cash flow is doing at a given period.

Profit and Loss

Under the cash flow section, on the left side is the profit and loss box. The income and expenses are represented by a total amount followed by a horizontal bar graph that lets you visually compare how total income (top bar) fares with the total expense (bottom bar).

Expenses

Next to the profit and loss box is the total expense section. This is represented by a circular graph and lets you see how much your business has spent on a particular expense account.

Bank Account Balances

The box on the right side represents the bank account balances on both your actual bank account and the balances on QuickBooks. This lets you see immediately if the amounts don't match and if it needs to be reconciled.

It’s crucial that the amounts match, especially if you manually log transactions. If there are any discrepancies, it's a sign that there are transactions that are not recorded.

Invoices

Under the profit and loss box is the invoice box, represented by a horizontal graph. It gives a visual representation of invoices that are overdue or not, as well as payments that are deposited or not.

Having a good view of this helps you manage your short-term debts and the credits you give to customers. As a result, you'll improve supplier and customer relationships and your business's cash flow.

Bill Payments

This box is next to the invoice section and is available for the Advance QuickBooks online accounting software plan. In this plan, you can integrate third-party bill payment tools to automate your bill payments.

Sales

Sales is the last section of the dashboard, represented by a line graph. This lets you see your sales trend for a particular period easily. You can also adjust the period (the default is 30 days) to better look at your sales trends.

On the top left portion of the sales box is the amount your business earned during that period.

quickbooks online software website page as seen on a smartphone screen

Privacy Features of the Dashboard

Your QuickBooks account dashboard is rich with confidential information. If your business is not offered publicly like most corporations or ecommerce businesses in the online marketplace, the financial detail on the dashboard should remain in private eyes. That's why QuickBooks offers the following privacy features among its many other awesome features.

These privacy features are available for many QuickBooks plans such as QuickBooks Plus, QuickBooks Desktop Pro, QuickBooks Enterprise, and QuickBooks Advanced, to name a few.

Privacy Mode

The data will be hidden by toggling this switch on the upper right portion of the dashboard. This is useful if you're in a public area or at a networking event where you have to look at your business information while others are looking over your shoulder.

Hide Button

This feature lets you completely hide the box from your QuickBooks online account dashboard. Not only does this give you privacy, but it also gives you more room to view other sections within the dashboard.

Setting Up Opening Balances

One of the most important first steps you have to do when you get an Intuit QuickBooks online account is to set up your opening balances. Whether you're an entirely new business or have already started, this is required.

To get started,

1. Go to the gear menu on the right portion of your QuickBooks accounting software.

2. A rectangular menu will pop-up, on the leftmost corner under the Your Company heading, click on Chart of Accounts.

3. Alternatively, you can also access the chart of accounts in the Accounting tab on the left side menu.

When setting up balances, you'll have to choose the following accounts.

Bank

This is either a checking or a savings account. The opening balance you must set should equal the deposit balance on the date you wish to start. So, for example, if you want to set today as the starting date, you'll have to enter the current bank balance today.

Credit Card

For credit cards, the amount should be the remaining balance from your credit limit at a given date.

quickbooks online software - accounting professionals in a meeting looking at graphs

Understanding QuickBooks’s Chart of Accounts

The chart of accounts is an essential accounting software feature. When you first use QuickBooks, it is where you'll be spending your time as you'll need to set up the accounts where each transaction goes.

QuickBooks's chart of accounts is categorized by Account Type. These default categories define each transaction and help with financial statement reporting.

This method of classifying transactions is the same for every QuickBooks plan, such as the Intuit QuickBooks Online Advanced, QuickBooks Desktop, QuickBooks Pro, QuickBooks Simple Start, QuickBooks Enterprise, and any QuickBooks online inventory management software.

The Account Type

Account Type is the main categorization option of QuickBooks. Every time you add a nominal or real account, you'll have to select one of these account types. So you must understand them to help you classify your transactions correctly.

Income

This account type pertains to all income the business generates. It can be in the form of a sales receipt, investments, interest, and service revenue, to name a few. Whatever money your business earns goes here.

Cost of Goods Sold (COGS)

Every tangible product needs to be produced, and this activity incurs costs. That's what COGS is for.

You might wonder why there's a COGS if this can be classified as an expense. That's because COGS is part of the production process and is accounted for when calculating profit margins. So it’s important to have inventory software like QuickBooks online to get COGS right.

Expenses

Whatever your business pays in its day-to-day operations falls under this category. Expenses—including rent, utilities, office supplies, salary, and marketing activities—fall under this category.

Accounts Receivable (A/R)

In most cases, you'll be giving your loyal customers leeway in terms of payments. So you'll sell them your product on a credit basis. The amount you will receive soon falls under the accounts receivable Account Type.

Accounts Payable (A/P)

The opposite of accounts receivable is accounts payable. This is when your suppliers give you credit privilege to purchase merchandise or raw materials on credit. This short-term loan obligation spans from 30 days to about nine months.

Fixed Assets

Fixed assets are the things your business owns. More specifically, these are the tangible and intangible things that contribute to the business's ability to generate revenue. Things like automobiles, pieces of machinery, and office furniture fall under this Account Type.

It's important to note that assets depreciate in time, so the value of these assets decline over time and must be accounted for.

Current Liabilities

This is an Account Type that's dedicated to other short-term loan obligations. It still follows the same payment duration period as accounts payable, except these loans are used for other business activities that don't involve purchasing goods on credit.

Long-Term Liabilities

This is also known as non-current liabilities. These are the types of loans that a small business gets into with a payment duration that spans years.

Long-term liabilities are often large sums of money that are paid consistently within the span of a loan. This is often used for an additional cash injection for business expansions, or to save the business from operation seizure.

Equity

This is your share of the business represented in monetary terms. One rough example would be your business bank account balance. That amount is part of your equity as it is cash you put into the business.

Note that equity doesn't always mean cash. It can also take other forms, such as properties. For example, when a small business owner declares a building they own as business equity, it's valuated to determine the market value. Once accountants know how much the property is worth, they put it down as the owner's business equity.

QuickBooks Online Software Is Better with Accounting Professionals

The QuickBooks items discussed above are just an overview of how QuickBooks works. There are plenty of things that you can do with QuickBooks, and we're happy to share the knowledge with you. That way, you can understand how this amazing accounting software works.If you want to understand QuickBooks and really put it to work, talk to our accounting professionals. We can run this accounting software for you and put your business finances on autopilot. Book a call at 877-421-7270, or check out our ecommerce services now.

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Unloop is the first and only accounting firm exclusively servicing ecommerce and inventory businesses in the US and Canada. With the power of people and technology, our team dives deep into COGS and inventory accounting.. You are paired with a dedicated bookkeeping team that prepares accurate financial statements, financial forecasts, and can also pay bills or run payroll for you. Come tax time, everything is organized and ready to go, so you don't need to worry. Book a call with an ecommerce accountant today to learn more.

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