Setting Up a New Company in QuickBooks

Setting Up a New Company in QuickBooks

Part 1 Response

Companies are increasingly embracing accounting software such as QuickBooks for managing financial operations. This means that accountants have to be very careful when using QuickBooks, especially when setting up new companies. One consequence is that the company may be forced to pay a certified public accountant to redo the entries. When this happens, the company incurs extra, unplanned-for expenses. It has been established that when accountants mix up bank deposits and invoice payments from customers, the end result is overstated sales. During tax time, the company finds itself having a higher tax obligation, meaning it must pay more as income tax (Roesch, 2020). A second consequence is that the company may have to pay hefty penalties to the authorities, especially if it submits error-filled taxes. Thirdly, companies may incur substantial losses in their quarterly as well as yearly reports; if the losses are very huge, the company may be forced to close down.

Part 2 Peer Response

Your post provides a great introduction into the importance of ensuring accuracy when using QuickBooks in setting up a new company’s business. The precision in highlighting consequences of incorrect setup is also commendable. However, I feel that the terminology used in explaining the points is quite too advanced for the average reader. For example, one may struggle to understand what you mean when you say that bank accounts coming into QBO with already established balances will not convert over to some other existing system. Similarly, you could consider elaborating the point on account numbering options so that it becomes clearer and more understandable.

Reference

Roesch, B. (2020). How to fix Quickbooks accounting mistakes- three common blunders. https://missionaccountinghelp.com/technology/quickbooks-technology/the-terrible-three-how-to-fix-quickbooks-accounting-mistakes