Budgeting is just another component of running a business. Not only do you need to know where your money is coming and going, but you should have limits so you only spend within your means. Budgets encourage accountability and responsibility. QuickBooks, the number one accounting software for small to midsize businesses, makes budgeting a breeze with a built-in tool for your convenience on both the online and desktop versions of their software. Let’s get started!
Once you are logged into your QBD account, go to Company > Planning & Budgeting > Set Up Budgets. From there, update the year you are budgeting for and choose your budget type. The two budget types are Profit & Loss or Balance Sheet. Normally, a Profit & Loss statement is preferred. In addition, QuickBooks allows you to edit any additional criteria, like the customer/job, class segment, or nothing.
From there, you can decide if you want to start your budget from scratch or use last year’s exact data to create this year’s budget. We recommend creating a budget using past data, this way you know your budget is in line with your average financial situation. Once all of that has been done, you can click “Finish.” If you click, “Adjust Row Amounts,” you can increase or decrease the amount or percentage per month, which allows for updating your budget a breeze with ease.
Similarly, make sure you are logged into your QBO account. Click the gear icon, go to Tools > Budgeting > Add Budget. QBO will automatically default to the current fiscal year with no pre-filled data. Once again, you have the option of starting from scratch or filling in the blanks with last year’s actual data. Then, name your budget. Something as simple as “2021 Budget” would work.
From there, you can start making adjustments. After that, you can run a Budget vs. Actuals report, which shows you each month’s actual numbers versus budget, the amount you went over/under, and the percentage of your budget. To receive even more insight, you can customize and mess around with the available features to see a month versus cumulative.
Even if you don’t use QuickBooks, it’s vital to keep a budget and review regularly. Check out your current accounting software for available budgeting features and utilize them! If you want to make the switch to QUickBooks, contact Skynar Bookkeeping Services for the best deal available.