Chapter 4
Your Vendors
In this chapter:
• Build your vendor list
• The Vendor Center
• Edit vendors
• Delete vendors
• Merge vendors
• Create custom fields to track vendor information
• Designate a vendor as eligible to receive a Form 1099
QuickBooks refers to the businesses or individuals from which you purchase goods and services as vendors, and the names of these vendors have to be entered into your QuickBooks system before you can enter bills or otherwise pay them. In most cases, it’s easier to enter their information before you start entering transactions. And, just like your list of customers, you not only have the ability to store basic information such as address, phone number, and e-mail, but you can also track and manage nearly everything and anything you need to know about that vendor—and all your other vendors—in the Vendor Center.
Create Your Vendors List
As with your Customers list, you have a few options when building your list of vendors in QuickBooks. You can choose to add them one-by-one (the details for using that method are covered in this section), you can use the Add/Edit Multiple List Entries window (covered later in this chapter), or, if you’ve been storing this information in an Excel sheet or a comma-separated file (.csv file), you may want to consider using a special QuickBooks utility designed to import this information. This import utility contains a step-by-step wizard that can be accessed by selecting File | Utilities | Import | Excel Files. The utility can also be used to import your customers, inventory items, and your chart of accounts.
To create a vendor, you’ll first need to open the Vendor Center. From the Vendors menu, select Vendor Center. Now click the New Vendor icon above the Vendors list and select New Vendor. The New Vendor dialog opens to the Address Info tab, as seen in Figure 4-1.
FIGURE 4-1 |
Enter contact and billing information about your vendor on the Address Info tab. |
Address Info
Start by filling in the Vendor Name field at the top of the window, and then move on to fill in as much information as you think you’ll need about this vendor, including contacts, telephone numbers, and so on. The Billed From address block is important if you’re planning to print checks and the vendor doesn’t enclose a return envelope, because this is where you’ll likely send your payment to. You can purchase window envelopes, and when you insert the check in the envelope, the vendor name and address block is located in the right place to show through the window. The Shipped From address is used if your vendor ships from a different place than they bill from.
It’s best not to enter anything in the Opening Balance field. Instead, separately enter the existing open vendor bills that represent the current open (unpaid) balances. See Chapter 7 to learn how get vendor history into your company file.
Currency
If you’ve enabled multiple currencies, select the appropriate currency for this vendor if the vendor is in another country. (Refer to Appendix B for more information on the QuickBooks multiple currencies feature.)
Payment Settings
The Payment Settings tab allows you to store some useful information:
• Account No. If an account number is associated with this vendor, you can enter it here and the number will appear in the memo field of printed checks.
• Payment Terms The terms you enter here will automatically be applied to all bills entered for this vendor.
• Credit Limit QuickBooks will give you a warning if you enter a bill or write a check that exceeds your credit limit with this vendor.
• Billing Rate Level (This field is available only in the Premier and Enterprise levels of QuickBooks.) If you plan on rebilling your customers for the work performed by this vendor, you can enter either a standard hourly or custom rate here. Then each time you create an invoice with billable time, QuickBooks will automatically fill in the correct rate for each service item based on the vendor that did the work.
• Print Name On Check As Fill in this field if the Payee name is different from the Vendor name used.
Tax Settings
If you plan on issuing a Form 1099 to a vendor at the end of the year, you’ll want to be sure to complete the following information:
• Vendor Tax ID Use this field to enter the social security number or employer ID number (EIN) if this vendor receives a Form 1099.
• 1099 status If appropriate, select the check box for Vendor Eligible For 1099. Learn more about the 1099 tracking feature later in this chapter.
Account Settings
Prefilling expense accounts is a great way to save time and ensure accuracy when entering bills or writing checks. When you select accounts in this window for this vendor (see Figure 4-2), they’ll appear automatically when you enter a bill or a check for the vendor. You can always change the prefilled account before saving the bill or check, if necessary.
FIGURE 4-2 |
Prefill the usual posting account for a vendor to save time and avoid errors. |
You can prefill up to three accounts for a vendor. This feature can be very useful for your Internet service provider, for example, for which you may want to split out Internet service and telephone service. Another good use is for making loan payments, which require postings to principal and interest.
ProAdvisor Tip: If a vendor needs only one account, but you often split the amount due in order to assign parts of the bill to customers, enter the same account in all three fields of the Account Settings tab. QuickBooks will list all the accounts in the transaction window. For example, parts of your telephone bill (usually long distance charges) may be charged to multiple clients as reimbursable expenses.
Additional Info
The options available on this tab allow you to capture other details about your vendor that will give you enhanced tracking and reporting:
• Vendor Type Select a vendor type or create one. The Vendor Type field is handy if you want to sort vendors by type, which makes reports more efficient. For example, you can create vendor types for inventory suppliers, tax authorities, and so on.
• Custom Fields You can create custom fields for vendors (see the section “Use Custom Fields in Vendor Records” later in this chapter).
Adding and Editing Multiple Vendor Records
Suppose you want to add information to many or all of your vendor records at once, or you want to find an easy way to enter new vendors in a more streamlined way. You can use the Add/Edit Multiple List Entries window to do just that.
From the Vendor Center, select New Vendor | Add Multiple Vendors. (You can also access this window by selecting Lists | Add/Edit Multiple List Entries and selecting Vendors as the list type.) The Add/Edit Multiple List Entries window opens, as shown in Figure 4-3.
FIGURE 4-3 |
Add and edit multiple vendor records in the Add/Edit Multiple List Entries window. |
From here, you can add new vendors, change or update key information, or fill in data you perhaps didn’t have when you first created the vendor. You can even copy and paste vendor information from an Excel worksheet into the Add/Edit Multiple List Entries window to create a new vendor record quickly.
Here’s a list of some of the important features and functionality that you should be familiar with to get the most benefit from using the Add/Edit Multiple List Entries window:
• List and View filters Select the List or View drop-down arrow to display only those records in your list that you want to work with.
• Customize Columns button Use this button to open the Customize Columns window. Here you can add the columns to the vendor record that you want to modify or add columns to match those in a spreadsheet that you want to copy and paste from into QuickBooks.
• Copy Down Right-click a field in the table and select the Copy Down command to copy the contents of a selected field to all the remaining records in the list (you can’t, however, use the Copy Down command with the Name field).
• Duplicate Row Right-click any row in the table and choose Duplicate Row to duplicate the selected record in the row below. The new duplicate record name will start with DUP.
The Vendor Center
The Vendor Center is where your list of vendors is stored, along with all the information about each vendor’s transactions. To open the vendor center, choose Vendors | Vendor Center from the menu bar (or click the Vendors icon on the Icon Bar). The Vendor Center displays your Vendors list, gives you quick access to key reports, and makes it easy to enter vendor transactions (see Figure 4-4).
FIGURE 4-4 |
The Vendor Center is where the key information about your vendors lives. |
The left pane of the Vendor Center has two tabs: Vendors (which is your Vendors list) and Transactions. A vendor is always selected in the list (by default, the first vendor in the list when you first open the Vendor Center), and the right pane of the Vendor Center displays the details that you’ll want to track for the selected vendor as well as any transactions related to that vendor.
Customizing the Vendor Center
You can customize the information displayed in the Vendors list (the Vendors tab in the left pane of the window), as well as the Vendor Information pane on the right side of the window.
Customizing the Vendors List
By default, the Vendors list has three columns: Name, Balance Total, and Attach. The Attach column displays a paper clip icon next to the vendor name if you’ve attached a scanned or other document to that record using the Doc Center (see Chapter 1 for more about the Doc Center). Use the scroll bar to get to the part of the list that has the vendor you want to see.
You can use the drop-down list at the top of the Vendors tab to display your vendors in any of following ways:
• All Vendors
• Active Vendors
• Vendors With Open Balances
• Custom Filter
Use the Custom Filter to display only vendors that match the criteria you set in the Custom Filter dialog. The options in the dialog are easy to understand and use.
You can add more columns to the list by right-clicking anywhere in the list and choosing Customize Columns to open the Customize Columns dialog seen in Figure 4-5.
FIGURE 4-5 |
Customize the Vendors list to see only the information important to you. |
To add a column, select its label in the left pane and click Add. The information the column describes is displayed for each vendor in the list. As long as the vendor you’re interested in is displayed on the portion of the list that’s visible, the information is available—you don’t have to select the listing or open the record.
You can rearrange the left-to-right order of the columns by opening the Customize Columns dialog and selecting a column you want to move. Choose Move Up to move a column to the left or Move Down to move it to the right. The order of columns displayed in the Chosen Columns pane of the dialog translates as top to bottom = left to right.
If you add columns to the Vendors list, you won’t be able to see all the information unless you widen the list’s pane and also adjust the width of each column. To maximize this pane, click the Show Full List Only button (shown previously in Figure 4-4).
Working in the Vendor Information Pane
In the Vendor Information pane, you can view all the information you’ve entered for your vendors as well as each and every purchasing-related transaction (see Figure 4-6). The bottom half of the pane has five tabs that contain transaction details, contact information, To Do’s, notes, and a list of e-mails sent to this vendor. Use the Manage <tab name> button at the bottom of the window to create a new entry, edit, or delete the information on any one of these tabs.
FIGURE 4-6 |
View, access, and update vendor information and transactions directly in the Vendor Information pane. |
Transactions Tab By default, the Transactions tab lists all types of vendor transactions. Selecting a transaction type (using the drop-down arrow next to the Type field) will filter for the selected transactions for a particular vendor. You can also filter the information that’s displayed on the Transactions tab by changing one or all of the three available filters: Type, Status, and Date. In addition, you can add and remove columns by clicking anywhere on or below the column headings and choosing Customize Columns. In the Customize Columns dialog, you can add, remove, and change the order of columns.
Contacts Tab You can add more detail about who to talk to if you have a question about a bill via the Contacts tab. There’s even a field for a vendor’s Facebook or Twitter information.
To Do’s Tab From the To Do’s tab, click the Manage To Do’s button and select Create New to compose a reminder for a specific vendor in the Add To Do dialog, shown here:
This is a very useful feature that lets you specify the date on which you want to be reminded (the Due date) and categorize your new To Do as a call or meeting, for example. You can then view your To Do note in the Calendar (discussed in Chapter 1) or directly in the Vendor Center. When the task is complete, open the reminder and change its status to Done. Use the Run Reports button to see a detailed listing of all your To Do’s—including those for customers and employees as well.
ProAdvisor Tip: If you want to view a list of all of your QuickBooks To Do’s, select To Do List from the Company menu. From this “global” list you can add, edit, or delete a To Do or even print a report that shows the details of each task.
Notes Tab From the Notes tab, click the Manage Notes button to add, edit, or delete a note in the Notepad dialog, shown next. Click the Date/Time Stamp button to insert the current date automatically when you’re adding text to the notepad.
Sent Email Tab Use the Sent Email tab to view and keep track of the purchase orders that you’ve e-mailed a vendor:
Edit Vendor Information
You can edit a vendor’s information by double-clicking the vendor’s listing in the Vendors list. The vendor’s record opens in Edit mode. From here, you can fill in data details you didn’t enter when you first created the vendor. Many QuickBooks users prefer to enter just the vendor name and company name when they set up vendors, so they can start entering historical transactions immediately. Later, when they have some time, they edit the record to fill in the missing data.
You can change any data you’ve previously entered, but change the data in the Vendor Name field with caution, since doing so will change the way it appears in your Vendors list and key vendor reports. Changing the Vendor Name field can also change the name associated with past transactions that you have cleared in QuickBooks. For example, if your phone company changes from AT&T to Verizon, and you change the vendor name, all past checks and bill payments written to AT&T will show as written to Verizon.
Delete a Vendor
You can remove a vendor from the list only if that vendor has never been involved in a transaction. It doesn’t matter if there’s no open balance, or the last transaction was a long time ago; the fact that a vendor is in your transaction history means you cannot delete the vendor.
To delete a vendor, select its listing in the Vendors tab of the Vendor Center and press CTRL-D. QuickBooks asks you to confirm the fact that you want to delete the vendor; just click OK to finish the task. If the vendor has ever been involved in a transaction, QuickBooks issues an error message saying you can’t delete this vendor.
If you can’t delete a vendor but you don’t want this vendor used in transactions, you can hide the vendor’s listing by making it inactive.
Make a Vendor Inactive
If you can’t delete a vendor, but you don’t want to use the vendor anymore, you can prevent users from selecting this vendor in transaction windows by making the vendor inactive (hiding the vendor name so it doesn’t appear in drop-down lists).
To make a vendor inactive, right-click its listing in the Vendors list and choose Make Vendor Inactive.
If your Vendors list is configured to show Active Vendors (the default view), inactive vendors don’t appear on the list. To see which vendors are inactive, click the small down arrow to the right of the View field at the top of the list and select All Vendors from the drop-down list. Inactive vendors have an “X” to the left of their listings. To make a vendor active again, select All Vendors as the view and click the “X” next to the hidden vendor or job to toggle the setting back to active. Inactive vendors are included in reports, so you can continue to get accurate reports on purchases and other vendor activity.
Merge Vendors
Sometimes you create a vendor and enter transactions for them before you realize you’ve created a duplicate of an existing vendor. In this case, you can merge the two vendors and move all the transaction history into one vendor record. Here are the steps:
1. Double-click the listing of the vendor you do not want to keep, which opens its record in Edit mode.
2. Change the data in the Vendor Name field to match exactly the name of the vendor you want to keep.
3. Click OK.
4. QuickBooks displays a message telling you that the name is in use and asks if you want to merge the names.
5. Click Yes.
Remember, the trick to merging is to start with the vendor name you don’t want and merge into the vendor name you do want.
Use Custom Fields in Vendor Records
You can add your own fields to the Vendor, Customer, and Employee records. QuickBooks provides the ability to create custom fields for Names lists (and also offers custom fields for Items).
Custom fields for Names lists are added to all Names lists, but you can configure each custom field you create to limit its appearance to specific Names lists. For example, you might create a custom field that you want to use in only the Vendors list, or in both the Customers & Jobs and Vendors lists.
Custom fields are useful if there’s information you want to track but QuickBooks doesn’t provide a field for it. For example, if you have vendors with whom you’ve signed contracts, you might want to add a field that will let you track contract renewal dates.
Adding a Custom Field for Vendors
To add one or more custom fields to the vendor list, follow these steps:
1. Open the Vendor Center.
2. Select any name on the Vendors list and press CTRL-E to put the record in Edit mode.
3. Move to the Additional Info tab.
4. Click the Define Fields button to open the Set Up Custom Fields For Names dialog, where you can name the field and indicate the list(s) in which you want to use the new field (see Figure 4-7).
FIGURE 4-7 |
Design custom fields that you can use for one list or multiple lists. |
That’s all there is to it, except you must click OK to save the information. When you do, QuickBooks flashes a message reminding you that if you customize your templates (forms for transactions, such as bills or checks), you can add these fields. The Additional Info tab for every name in the list(s) you selected now shows those fields, and you can add data to any name for which these fields have relevance.
Adding Data to Custom Fields
To add data to the custom fields for each name on the list that needs the data, select the name and press CTRL-E to put the record into Edit mode. Move to the Additional Info tab where the custom field you created appears (see Figure 4-8).
FIGURE 4-8 |
Add data to the custom field for each vendor to which this custom field is relevant. |
Be sure that you enter data in a consistent manner for each vendor, or you won’t be able to get accurate information when you customize a report to include this information. For example, consider the data entered in the custom field Last Review Date shown in Figure 4-8. If you enter Dec 31, 2013 for some vendors and 12/31/2013 for others, and then customize a report looking for 12/31/2013, all the Dec 31, 2013 vendors will be missing from the report.
Create 1099 Vendors
QuickBooks supports only the 1099-MISC form. If any vendors are eligible for 1099 reporting, you need to enter additional information about them when setting them up. The focus of this section is on accomplishing this task before you begin making payments to a 1099 vendor. The process of verifying and filing 1099 forms in QuickBooks is covered in detail in Chapter 18.
Configuring 1099 Options
First, make sure your file is set up to track and process 1099 forms: choose Edit | Preferences, click the Tax: 1099 icon, and move to the Company Preferences tab to see your settings (see Figure 4-9). Be sure you’ve clicked Yes next to the question Do You File 1099-MISC Forms?
FIGURE 4-9 |
Be sure to turn on the 1099 tracking feature. |
Marking Vendors as 1099 Recipients
Generally speaking, you are required to issue Form 1099-MISC at the end of the calendar year to a vendor to whom you’ve paid $600 or more and who operates their business as an individual or partnership.
To issue Form 1099, you must have the vendor’s federal Tax Identification Number (TIN), which can be a social security number or an employer identification number (EIN). Open each appropriate vendor listing and open the Sales Tax Settings tab. Select the option labeled Vendor Eligible For 1099, and fill in the Vendor Tax ID number as shown in Figure 4-10.
FIGURE 4-10 |
Mark each eligible vendor for 1099 reporting and fill in their Tax ID number. |
ProAdvisor Tip: 1099 reporting rules are becoming more complex each year. It’s a very good idea to check in with your accountant about the latest IRS rules regarding which vendors should receive a 1099 from you. Also be sure to ask your accountant if you should be aware of any other guidelines or rules.
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