You can keep all of your company’s financial information up to date via QuickBooks accounting software. Profit & Loss statements, QuickBooks balance sheets, and cash flow statements altogether comprise financial statements. These financial statements will assist you in tracking your business prospects and areas for development. This QuickBooks Balance Sheet shows your organization’s resources, obligations, and capital contributions from owners at a certain period in time.
In this article, we will make you understand the QB balance sheet, its importance, and the work process. You just have to read this article till the conclusion to get more and clear knowledge of the Balance sheets in QuickBooks.
What is the QuickBooks Balance Sheet?
The balance sheet or QBs balance sheet is an illustration of a company’s liabilities, assets, & QB balance equity – effectively. This is a snapshot of the company’s value at a time. The final result is the equity or value of your company which can be surely attained if you subtract liabilities from assets.
Bank accounts, Cash, trade receivables, investments, inventories, buildings, & equipment are a few examples of assets. The value of an asset reflects on the Balance Sheet, which is also called book value, and it frequently differs from the asset’s true market value.
Credit card bills, vehicle loans, trade payable, & mortgages are a few examples of liabilities.
QuickBooks Balance Sheet Characteristics in General
Balance sheets in QuickBooks have merely based on the fundamental accounting principle of assets equals liability plus equity. In QuickBooks, organizations tailor the data to their specific needs, they often contain cash, fixed assets, accounts receivable, & accounts payable, and other things. The Balance Sheet uses to demonstrate to investors, owners, & creditors the capacity of the organization to satisfy debt commitments by describing current liquidity. Moreover, the Qbs balance sheet function such as the financial report card highlights various aspects of the organization that are doing well and those that need to be improved.
After having a brief overview of the balance sheet and its characteristics; let us now understand its importance.
Also Read: How to Make a Journal Entry in Quickbooks | Easy Guide
Importance of QuickBooks Balance Sheet
The QBs balance sheet provides information based on the net value of the company. So the most essential item is the balance sheet. It plainly shows you what you have or what you possess. Many of the assets are not priced in accordance with the market. The assets list provides information that shall use to calculate the company’s fair market value. It displays the estimate by deducting the amount owed by the firm from the projected fair asset market value. This determines your company’s net value.
Examples of the Components of QuickBooks Balance Sheet
The balance sheet QuickBooks comprises of three components, such as assets, liabilities, and equity. Let us have a quick overview of these components in detail:
Assets are the goods that your organization possesses and the money that individuals owe you. In the QBs balance sheet accounts receivable refers to invoices that are awaiting payment from clients. Also, the undeposited funds refer to a clearing a/c used to consolidate payments into a unified bank deposit. In addition, fixed assets include the company’s buildings & equipment.
Liabilities are the amount owed to suppliers and creditors. Trade Payable are overdue invoices owed to vendors. Any instrument finance that the corporation needs to pay will lie under the category of Liabilities.
QB Balance Sheet adds an item to open the Bal Equity during creating a new a/c with tarting balance. It usually happens when you initially build up your firm, & the amount also in opening balance equity won’t alter after that.
Retained Earnings are the profits that have accumulated within your organization. This amount on your QBs online balance sheet represents the pending amount at the start of a reporting period. These retained earnings are the same as those on the subsequent balance sheet. Then, add the net income and subtract the distributions of any owner.
Moreover, the net income must correspond to the loss and profit statement for the reporting period.
Working With the Balance Sheet in QuickBooks
Creating a balance sheet in QB is simple if done correctly. Here are the procedures to follow in order to run your balance sheet within QuickBooks correctly. The procedure is as follows:
- Firstly, navigate towards the left side menu in QB.
- Then, select the reports option.
- After that, navigate towards the section of Business Overview of the reports.
- Then, select the Balance sheet option.
- Scroll up to see and alter the balance sheet choice.
- The balance sheet may then be further customized by selecting the Customize option.
- Now, the final report will then appear on your screen
- Lastly, to acquire the QuickBooks balance sheet report in the format you desire, select one of the options: print, email, or export.
Following are the detailed processes for creating a new balance sheet in your QB Online account:
Step 1: Make a New Balance Sheet
Here’s how to make a fresh balance sheet in your QB Online account. The steps are as follows:
- Firstly, select Reports from the left-hand menu.
- Then, select the option Business Overview as well.
- After that, select the option of the balance sheet from the drop-down menu.
Step 2: Configure the Choice for the QuickBooks Balance Sheet Report
In this step, move forward from the balance sheet in QBs to get the basic settings for a report of your QB balance sheet.
Then, fill in the blanks and press the button of Run Report. The following details must provide:
Select the time period for which you’re creating financial statements from the drop-down menu. You may either select a predefined time period or input the start and end dates for the custom period.
Display Columns by:
By default, the Balance Sheet in QuickBooks will just have unified columns for the balances at last. Balance Sheet QB Online also permits you to select extra columns for intermediate balances, like quarterly. Choose this option from the menu. Extra columns can add to divide balances by vendors, customers, locations, classes, and other categories.
You may like to know - What is Quickbooks Install Diagnostic Tool?
Show Active or Non-Zero Only:
The balance sheet displays the rows & columns that are active or actively in use in this accounting period automatically. This allows you to avoid having any unneeded items on your balance sheet.
Compare Other Periods:
The QBs balance sheet allows you to compare balance sheets from different time periods. You can enter a previous period balance sheet balance into the newly created column for direct comparison. A column displaying the difference b/w the current & previous periods may be added. This might be expressed as a monetary or change percentage.
Click Run report in order to execute all of your changes.
To save your QB Balance Sheet settings, you may save all of your adjustments & give the name of your report in the QuickBooks Balance Sheet. This personalized QuickBooks Online Balance Sheet is accessible via the Reports option.
Click Customize to make changes to your balance sheet in QuickBooks.
You must choose an accounting approach because there are only two options. The two ways are cash basis and accrual basis. Account receivables and payables are part of the accrual accounting technique. This strategy is recommended for use in balance sheets for management purposes. For tax purposes, small enterprises employ the cash basis technique.
Step 3: Customize Your Balance Sheet Further
You can alter your Balance Sheet in QBs Online by choosing the button Customize. There are four sections on the screen of Customize report:
The report on Customize begins with this section. The Accounting methods & a Report period options in this General section are the same. As a result, any changes made in the first one should be reflected in another one. You can also report numbers in the thousands of dollars, leaves cents from the Balance Sheet, & select the format for the negative numbers in this section.
Rows or Columns
You can choose which columns to include by using the Rows or Columns option. You can modify the column order. The option of column percentage allows you to examine how your whole assets are distributed across each asset a/c. Columns can be reordered by first choosing them and after that hitting & dragging them up and down.
Read About- Advantages of QuickBooks Database Server Manager
The QBs balance sheet can be filtered by five different variables. Running a Balance Sheet QuickBooks Online by location, customer, vendor, class, and product or service will suffice.
Header or Footer
In the Balance Sheet in QB, you can specify which information should be displayed within the header & footer. You can mark any field that you want to show on the QBs Balance Sheet with a checkmark. The header’s company or name of the report can be modified.
When you’re finished configuring the QB Balance sheet, hit the green button of the Run Report at the end of the choices list.
Step 4: Print or Send Your Balance Sheet Through Email
Using the icons on the top side of the QBs Balance Sheet, you can print, email, or export your Balance Sheet QuickBooks Online. To know how to print balance sheets in QuickBooks or in order to print, export, or mail a QuickBooks Balance Sheet report, do the following steps:
- Firstly, hit the email icon to send the PDF of the balance sheet.
- By hitting the printer icon, you can print a duplicate copy of the report on the QB Balance Sheet.
- Hit the export icon, you can export the PDF file or the Excel spreadsheet.
How Do You Repair an Out-of-Balance Balance Sheet?
Ever thought that the total asset in QuickBooks does not equal the sum of the total liabilities and total equity, thus resulting in out of balance. Thus to resolve an out-of-balance balance sheet in QuickBooks, use the steps listed below:
Solution 1: Restore the Primary Data Damage
To resolve data integrity concerns in QuickBooks, follow the methods outlined below:
- Use the regular approach to repair the damaged data.
- Investigate the qbwin.log file for faults and solutions.
- Run your balance sheet again to double-check your balance and confirm any discrepancies in amounts.
- Compress the time scope and look for when the balance sheet went out of balance. A problem occurs in QuickBooks.
Solution 2: Look for the Date When the Balance Sheet Became out of Balance
To locate the transactions that are causing the balance sheet to be out of balance, we must first determine when the report became out of balance.
- Select Company & Financials from the Reports menu.
- Choose Customize Report after selecting Balance Sheet Summary.
- Select All from the Dates drop-down menu on the Display tab.
- Continue on to the Report Basis section.
- If the balance sheet is out of balance in accrual, select Accrual. Otherwise, go with Cash.
- Navigate towards the Columns tab and pick Year from the Display column drop-down menu.
- By comparing Total Assets to Total Liabilities & Equity, you may see where the balance sheet got out of balance.
Solution 3: Check for the Transaction That is Causing the Balance Sheet Report to be out of Balance
- You must run a custom transaction detail report on the date you discovered that the balance sheet was out of balance.
- After that, return to the Reports menu and select Custom Report.
- Then, choose Transaction Detail to open the Modify Report window.
- Now, Look for the Report Date Range section and enter the date the report fell out of balance in the From and To fields. In the Report Basis section, select Accrual or Cash based on the balance sheet.
- Thereafter, uncheck the Account, Class, Split, and Clr boxes in the Columns section.
- Select the Paid Amount column and press OK.
- The Paid Amount column must equal the final balance. Examine the transactions that add up to the total.
To conclude, this article will make you understand the QuickBooks balance sheet, and its characteristics and significance.
Additionally, through this article, you will be able to understand the various types and components of a Balance Sheet. The operation of the QBs Balance Sheet with all of its options would have satisfied your purpose for reading this. By following all of these steps mentioned above, you can now easily work with the QB Balance Sheet without much hassle.