Q:

Subject: QB classes

 

Hello,

 

I read an article you wrote about classes, and I'm starting a new business and just setting up QB and trying to decide the best way to do it.

 

I don't know if you have time, but I'll try anyway.

 

This business is to be an employer agent, and will handle the payroll & taxes for people who are medicaid recipients. This allows a consumer to be the employer of record and to hire/fire their own homehealthcare workers. My company will get paid an amount per month per person to do this, the company will file electronically to the state for both the fee and the $ to pay the clients employees, and we'll pay the employees every 2 weeks, and print a report showing how much has been paid YTD and whats left in each persons yearly budget.

 

I'm trying to decide the best way to set this up. I was told once that each Client/Customer should be setup as a separate class within Quickbooks, and there are some bookkeeping and accounting entries that need to be made to adjust for this type of set-up, but I haven't figured out how to do it.

 

Do you have an idea as to how best to set this up that you might share with me?

 

Thanks,

A:

There are several ways in which you can set up your QB for your business.  There are too many options to consider for me to be able to advise which specific one would be the most practical for your unique situation; so you need to work with a professional accounting advisor.

I can make a few observations that may help you focus in on the best format for you.  One mistake I often see is when people set up a class for each customer.  This frequently makes the Class list too large and unwieldy to be practical, especially when you run a P&L with columns by Class.  I have normally found it more appropriate to have classes by type of business or tax return schedule (C, E, F, etc) and then make sure each income & expense entry is coded with the Customer or Project name.  That will enable you to produce plenty of different reports for each customer or project. 

Good luck.

Kerry Kerstetter

 

- posted by Kerry M. Kerstetter, MBA~CPA~ATP~ATA @ 8/13/2006 09:37:00 PM Send this post: