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Gnucash 2.4 Small Business Accounting: Beginner's Guide
Gnucash 2.4 Small Business Accounting: Beginner's Guide

Gnucash 2.4 Small Business Accounting: Beginner's Guide: Manage your accounts with this desktop financial manager application

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Gnucash 2.4 Small Business Accounting: Beginner's Guide

Chapter 2. Transactions – the Lifeblood of a Business

"I don't like keeping books…I just find it boring…But I'll tell you what! I always feel good after completing the book-keeping." – a successful small business owner in his blog.

On the other hand, there are others who look at accounting as a game. If something doesn't balance, they take it on as a fun challenge to track down the problem and find a solution. However, if you are like this small business owner, you may find bookkeeping a boring activity because it is very repetitive. Perhaps, you would rather be out cultivating customers and working on the deals that make your business grow and prosper. However, that is the very reason why we are going to spend some time equipping you with all the tools and tips necessary to get through this bookkeeping part quickly and effectively. With that taken care of, you can be free to devote more time to growing your business.

As a small business, on any given day, you may have several expenses which...

A quick and easy way to enter simple transactions


GnuCash provides a way by which you can enter simple transactions quickly and easily. It is so simple that on completing it, you will wonder why people are making such a big deal about bookkeeping.

Time for action – entering simple transactions quickly and easily


In this tutorial, we are going to enter a simple transaction of withdrawing $300 cash from the checking account.

  1. From the menu, select Actions | Transfer to open the Transfer Funds window.

  2. In the Basic Information pane, enter 300 in the Amount field, leave today's date unchanged in the Date field, enter the check number 2073 in the Num field, and enter Withdraw cash in Description.

  3. Scroll down in the Transfer From list and select Checking Account. You may have to click on the + sign to open the tree, if the account is not visible.

  4. Scroll down in the Transfer To list and select Cash. At this point, the window should look like this:

  5. Select OK to commit the transaction.

  6. We will now confirm that the transaction has been entered in the respective accounts correctly. In the Account tab, double-click on the Checking Account. It will open in a separate Checking Account tab. This is known as the account register for Checking Account. You...

Entering a simple transaction in the account register


The account register is the GnuCash window which allows you to view and edit existing transactions or add new transactions to a particular account.

Note

The account registers were designed by the GnuCash team to resemble a check book register, the log used to keep track of checks issued. This is the reason why they are called registers.

Time for action – entering a simple transaction in the account register


The account register will be the scene of much of your bookkeeping action. Let us get familiar with it first by entering a simple transaction.

  1. To open the account register, select the Expenses:Office Supplies account in the Accounts tab and double-click to open it. Once selected, you can also click the Open button in the toolbar or click the right mouse button and select Open Account. GnuCash will open the Expenses:Office Supplies account register in a separate tab. GnuCash will start a new transaction and put the focus on the date field with today's date as the default one.

  2. Let us make sure that your view settings are in line with the steps in the tutorial. Go to the View menu and confirm that there is a dot in front of Basic Ledger and Double Line is not checked, as shown in the following screenshot:

  3. Click on the small button on the right of the Date field to drop down a date selection calendar. Click on yesterday's date...

Entering a more complex transaction in the account register


We said earlier that there was an important reason for getting you familiar with the account register. With the simple transaction under your belt, you are now ready to take on bigger things, such as multiple-split transactions. These are often referred to simply as split transactions.

Time for action – entering a split transaction in the account register


Let's say that MACS sold a custom-built PC. In addition to the base price of the PC, MACS is required to collect five percent sales tax and pay it to the state. You can immediately recognize that it is not a simple 2-account transaction. How will we enter this check for $840, consisting of $800 towards sale price, and $40 towards state sales tax, in GnuCash?

  1. Preparatory Exercise: Now that you know how to create accounts, go ahead and create a new account VA Sales Tax of type Liability with Liabilities as the parent account. You can refer to Chapter 1, Getting started with GnuCash for the specific steps to create a new account.

  2. Open the Checking account register. GnuCash will start a new transaction and put the focus on the date field with today's date as the default. If not, start a new transaction by selecting Transaction | Enter Transaction from the menu. Alternatively, you can click on the Enter Transaction button on...

Anybody can change their mind


That is another way of saying that things went wrong and you want to fix them or start over. That is understandable at any time, but more so while attempting a tutorial. One way of handling that, as we pointed out earlier, is to quit GnuCash without saving. What if you have already saved a transaction and had a thought after that? Yes, GnuCash allows you to change your mind even that late in the game.

Time for action – editing, cancelling, and deleting transactions


We may not be able to get everything right just the first time. So, we need the ability to make changes or even clean up and start over. You can edit a transaction, cancel an edit, or even delete a transaction. Let us see how we can accomplish these:

  1. Editing transactions: Remember the $300 cash withdrawal? You suddenly realized that you actually withdrew $350. We are going to edit the transaction to correct this amount. Open the Cash account register, click on the amount, then make your changes, and click Enter. Check that this change is automatically reflected in both Cash and Checking Account. By the way, you can make this edit from either one of these accounts.

  2. Cancelling edits: In the same transaction, select the Num field and change it to 1595 and Tab out. Let us say, immediately after tabbing out, you realize that you have edited the wrong field, and horrors! You don't seem to have even a wisp of recollection what the number...

A feeling of déjà vu


You had earlier put in a lot of effort to enter a complex transaction. A week later, you are about to enter another transaction and you get a feeling of déjà vu. You feel as if you have been here before.

Time for action – reusing transactions


Wouldn't it be great if you can leverage the effort you had earlier put in to get this type of transaction just right? The good folks developing GnuCash have thought of all that and have just the solution for you – the ability to take an entire transaction and make a duplicate.

  1. Place the cursor anywhere in the split transaction we created for sales tax in the earlier tutorial.

  2. Go to Transaction | Duplicate Transaction or right-click and select Duplicate Transaction.

  3. A dialog called Duplicate Transaction will prompt for a new Date and Number for the transaction. Select a Date and enter 83791 in the Number field:

  4. Click on OK to add the transaction to the register.

  5. Edit the transaction so that the new description is Gaming PC, the new check amount is $630, the new Sales amount is $600, and the new sales tax is $30.

What just happened?

Note to self. At the next appointment, should ask the dentist whether there is a way to painlessly duplicate the previous root...

Summary


We learned a lot in this chapter about the core task in bookkeeping, namely, entering transactions and further tweaking them.

Specifically, we covered:

  • Simple transactions: If they are simple transactions, we can enter them in the Transfer Funds window or in the account register.

  • More complex transactions: If they are more complex transactions, known as split transactions, we have to use the account register.

  • Edit, cancel, and delete: Knowing how to edit, cancel, and delete transactions allows us to overcome our fear of making mistakes.

  • Duplicating transactions: We learned a powerful technique of duplicating transactions, which will help us to save a lot of work in bookkeeping.

  • Shortcuts: We learned a number of shortcuts to speed up entering transactions.

  • Navigation: We saw how to open the account registers, close them as well as jump from one account register to the corresponding one which has the other part of the transaction.

  • Views: We covered the different ways we can view the account...

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Key benefits

  • Help small businesses maintain their books of accounts using feature-packed, easy-to-use GnuCash
  • Written by an author who has "been there, done that": who ran two small businesses, understands the needs of small businesses, and guides you to effectively use GnuCash
  • Instead of simply describing the features of the software, this book focuses on how to use this software to plan, get the right numbers, and make the decisions to reach your business goals
  • While beginners can get started quickly, advanced users will find lots of features such as migrating transaction data and integration with other applications that they didn't know existed or could be used that way
  • Written without accounting jargon and with lots of hands-on tutorials, multiple choice questions to check your understanding, and additional challenges thrown at the more adventurous user, in an easy-to-read style

Description

Attention, small business owners! Stop tax-day stress. Stop procrastinating with a shoebox full of receipts. Stop reinventing the wheel with a spreadsheet. Stop making decisions simply on a hunch. Stop wasting money on software that is overkill. Start by downloading GnuCash and getting your accounts in order. Designed to be easy to use, yet powerful and flexible, GnuCash allows you to track bank accounts, income, and expenses. As quick and intuitive to use as a checkbook register, it is based on professional accounting principles to ensure balanced books and accurate reports. You can do it and Gnucash 2.4 Small Business Accounting Beginner's Guide will help you get up and running with maintaining your accounts. Gnucash 2.4 Small Business Accounting Beginner's Guide speaks business language, not accountant-speak, because it is written by a former small business owner. It guides you to use GnuCash from scratch with step-by-step tutorials without jargon, pointing out the gotchas to avoid with lots of tips. It will teach you to work on routine business transactions while migrating transaction data from other applications gradually. You will be able to keep on top of transactions and run reports after reading just three chapters! Beyond Chapter 3, it is up to you how far you want to go. Reconcile with your bank and credit card statements. Charge and pay sales tax. Do invoicing. Track payments due. Set up reminders for bills. Avoid stress at tax time. Print checks. Capture expenses using your mobile phone. Gnucash 2.4 Small Business Accounting Beginner's Guide gives you the power. Know your numbers. Make decisions with confidence. Drive your business to its full potential.

Who is this book for?

This book is written for you – the self-employed, the owner, partner or leader of micro-enterprises, home businesses, Small Office/Home Office (SOHO), and other small businesses – to help you maintain your books of accounts using GnuCash. This book is also for you – office-bearers of non-profits and students who want to learn accounting hands-on. If you are using a spreadsheet to maintain your business books and are wasting time, or you are handing over a shoe box of receipts to your high-priced accountant or are using another accounting application that is overkill for small business, get this book and download GnuCash.

What you will learn

  • Handle routine transactions with ease, such as creating and processing customer invoices, vendor bills, and employee expense vouchers
  • Use your bank and credit card statements to double-check your accounts by doing smart reconciliation
  • Set up scheduled transactions to automate repetitive work and let GnuCash remind you when bills and payments are due
  • Create a Trip Planner to reach your business goals using GnuCash budgets so that you can drive your business purposefully
  • Make tax times less stressful by mapping GnuCash accounts to your income tax schedules
  • Charge state, county, and local sales tax and print statements to send with payments
  • Print regular and voucher checks, also with memos, to ensure proper credit as well as for professional appearance
  • Extend the features of GnuCash to meet the special needs of non-profits
  • Use your mobile phone to capture expenses on the go
  • Migrate transaction data from other accounting applications
  • Integrate with other applications to avoid redundant data entry causing frustration and errors
  • Use canned reports, customize them, or create your own reports and charts using popular spreadsheet software

Product Details

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Publication date, Length, Edition, Language, ISBN-13
Publication date : Feb 09, 2011
Length: 324 pages
Edition : 1st
Language : English
ISBN-13 : 9781849513869
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Product Details

Publication date : Feb 09, 2011
Length: 324 pages
Edition : 1st
Language : English
ISBN-13 : 9781849513869
Category :
Tools :

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Table of Contents

12 Chapters
Getting Started with GnuCash Chevron down icon Chevron up icon
Transactions – the Lifeblood of a Business Chevron down icon Chevron up icon
Fun and Eye-opening Part - Reports and Charts Chevron down icon Chevron up icon
How not to Get Lost in the Transactions Jungle Chevron down icon Chevron up icon
Repetitive Work? Let GnuCash do it Chevron down icon Chevron up icon
Business Mantra: Buy Now, Pay Later Chevron down icon Chevron up icon
Budget: Trip Planner for your Business Chevron down icon Chevron up icon
Making Tax Times Less Stressful Chevron down icon Chevron up icon
Printing Checks and Finding Transactions Chevron down icon Chevron up icon
Adapting GnuCash for Non-profits and Personalizing Chevron down icon Chevron up icon
Data Import/Export: Use your Phone to enter Expenses Chevron down icon Chevron up icon
Application Integration and Other Advanced Topics Chevron down icon Chevron up icon

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Bookbag Jul 02, 2014
Full star icon Full star icon Full star icon Full star icon Full star icon 5
Gnucash is a great accounts package but I have no experience of accounting so I got a "Bookkeeping for Dummies" book which was awful and confused me no end. This book, which I bought just to help with the package, actually taught me so much more about accounting than the so-called bookkeeping book did. Yes it's designed for American businesses and banking (the software and this book) but I have found it to be very easy to adapt - even with my very low level of expertise - and because of it's simple, easy-to-follow, step-by-step approach I am now pretty confident in my bookkeeping abilities. I have been using it for a year now and the numbers in my Gnucash do match the numbers in my bank account / credit card / PayPal statements, so all is well. I would strongly recommend this software (which is free) but the book is an invaluable addition to it, totally worth the price.
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Ditsy Chick Apr 23, 2013
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I had previously purchased QuickBooks Pro to handle my small business accounting and found it totally OTT (over the top)--too complicated and unwieldy for my basic small business needs. In an online search for something better, I stumbled upon Gnucash software which is free, downloadable from the web, and easy to learn (if you've used other business software); however, the 'help' provided isn't very good. When I had questions ('how do I...?'), I couldn't find the answers and, when I signed up to the Gnucash forum with postings sent to my inbox, I was deluged with incomprehensible questions/answers at MIT-level expertise, so I quickly unsubscribed. I'm just a simple girl who really likes Gnucash, so I was DELIGHTED to discover this book on Amazon. i don't know if it answers everything, but it's easy to read and I'm well pleased with it so far. It was expensive (I purchased the Kindle version, cheaper than the book), yet far less costly than buying more small business software that didn't work for me. Highly recommended.
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Mike B. Sep 16, 2014
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Very helpful! I had figured out about 90% of this stuff on my own, but that extra 10% is well worth the price of the book. It doesn't hurt that the book is written in a far more approachable style than most books of this kind.
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Oscar J. Shearer Feb 10, 2014
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Started with nothing more than a need for bookkeeping and invoicing for my consulting. Book walked me through setting it up start to finish.
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hippielife Dec 12, 2013
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Really Awesome! I knew nothing about accounting even knew less about gnucash. In a few days I had everything done!
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