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Tawnya Sutherland

Incorporating three programs into Quickbooks

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Well......... that depends.

 

Do the businesses have anything remotely to do with each other?

 

In all reality, you really should have 3 separate files... let's say that you have 3 businesses:

ABC Widgets

XYZ Consulting

123 BookManiacs

 

You can set these up into QB with a classes function and run your reports by class...

 

But...

 

Let's say that ABC Widgets makes the most amazing Thingamabob in the world. Everyone wants one and everyone must have one right now! Great, right?

 

Yeah... until you decide that in order to meet demand of getting everyone one of those Thingamabobs you want to take on an investor or you decide to sell it the company while it's hot and retire to Bermuda. Then you have this file with 3 different companies in it where some stuff is commingled (oh, we all know the classes SHOULD make this work, but we live in the real world here).

 

Or let's say that your XYZ Consulting is going great, but you need a bank loan to buy this new great piece of equipment that could revolutionize the way you do your business. Your bank may want a financial and then it's all funky - the balance sheets will never look right.

 

See?

 

What happens then is you are stuck with this one file and 3 companies put in there and no real idea of how to break it out without having to redo stuff and make your accountant very very angry.

 

If at all possible, break them up. Have separate bank accounts and merchant accounts. That's the "right" way to do it.

 

Now, if you cannot do that, then uses class tracking, but be VERY careful. I don't trust class tracking for multiple companies myself though.

 

But I'm a purist and QuickBooks hates purists. LOL.

 

Edited to add: I forgot where else I was going...

 

Let's further say that 123 BookManiacs publishes a book and come to find out the author stole a bunch of content and you are now being sued. Ut-Oh. Not only are your records open to all your other companies (in possible theory here), but - and this might also be stretching it if it's not incorporated - you risk your other business assets as well - which is a whole other can of worms about business entity types...

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You could always upgrade to QuickBooks Enterprise Solutions which would allow you to combine reports for multiple company files. So you would still have seperate company files but be able to combine the reports easily for tax preparation, financials, etc.

 

Of course, QB Enterprise starts at $3k.

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You know how you ran screaming from the eaches...peaches....discussion? When someone gets into deep QB discussions or (God forbid) website design discussions, I'm the one that runs screaming and hiding and cowering in the corner, rocking and singing...rocking and singing...rocking and singing...

:whistlin:

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Guest Paul VA

OK. Candy said it best, but I'll have my say also.

 

You'd have to be NUTS to do such a thing, and if you did manage to do it, then you WOULD be nuts trying to keep up with it! :whistlin:

_____________________

Paul

 

 

How do you setup one quickbooks file to incorporate 3 of a sole proprietor's business into them instead of him having 3 separate sets of books. I know this is possible, how would one do it?

 

T.

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I think your right Candy... and if she does have wine I think she should share!

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Guest Arnie
Heh, Rebecka... I think we scared her off... I wonder how many glasses of wine she had today...

 

 

The bottle's on ICE Candy!!!

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hehehe...

 

We are just trying to problem solve some bookkeeping issues Arnie and I have.

 

We have 3 businesses:

 

MBS - Mediamage business Solutions

 

VBS - Virtual Business Solutions

 

MHA - MileHigh Aviation Solutions

 

Here's the big problem, they all use the same 2checkout merchant account. Why do you ask? Because getting merchant accounts in Canada is a ridiculous highcost stupid process so because of that, we just have one we share with all the busineses which runs through the VBS business. I need a solution and I'm brainstorming here I thought by combining all businesses into one set of books then I could just post everything to that one merchant account.

 

Sounds like that won't work and if not, then how do I do this? We can only get one merchant account so end of the story there, we must work around it. So....if Arnie sells an aviation mousepad, should be invoiced in MHA but first the money comes through VBS so how do I record that (without it being a sale to VBS) and then set up some system so that it gets posted at MHA for tax purposes?

 

I can do 3 sets of books, that is not a problem, the problem is sorting making journal entries that will please Mr. Audit if he ever comes by.

 

I'm going to start another post on Paypal (so as not to confuse both).

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Good discussion.

 

You could create an account, for example, called "advance to company xyz", and when you deposit-it would have to go into that account, and then come out of that same account-yet still be in that set of books for reconciliation purposes. I'm not sure if it would really matter if it were an expense account or a current liability account. That's my two cents.

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Trust me, combining all 3 sets of books would be a much bigger headache not to mention an IRS nightmare.

 

As Cathleen suggested, I would set-up pass-thru accounts as current liabilities on whichever set of books is actually receiving the money in, and post the income for the different companies into their respective pass-thru accounts. At the end of each period (day, week, month, etc.) write a check to each company for their portion of the income. Posting the check to the pass-thru account should zero it out. Then you can just deposit the check and accept it into income as normal in the other businesses.

 

You do not want another companies income flowing in and out on the income statement.

 

*It's 1am and I worked 14 hours today, so I hope that made sense.

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... what Cathleen said. Here in the US it might not be 100% kosher, you really should get separate merchant services, but in Canada, I'm just not sure of all the laws (is your bookkeeper that is there not sure either?).

 

Since you will be married soon and they are all sole props, you can probably get away with running through a clearing account... just make sure that ALL merchant service fees flow through to the different companies that belong with that transaction.

 

Ugh, that's going to be a lot of entries for you...

 

But you'd have to do that anyway with a class system so there's no real good answer there either :(

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I actually have a client that does have 3 different accounts like that and 1 merchant account. They do keep them separately in Quickbooks. 2 of the accounts very rarely have a credit card charge, so it wouldn't be cost-effective for them to get additional merchant accounts. I've got a "pass through" account I call "Clearing Account" to keep the money straight. As soon as the Visa/MC deposit clears the bank of ABC Company, that amount gets taken right back out and deposited to the account of XYZ Company. The Visa/MC fees are shown in the books of XYX Company. It may be different for them though because it's the same Tax ID number.

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Okay-am I understanding that the jist of everything so far is VANA is a sole proprietor?? If so...I find that maybe scary on your end-as the legalities make you personally responsible for everything... (at least in the US). I would think VANA would feel/be comfortable enough to be incorportated, especiaclly with the years of existence you have ! Maybe I read it all wrong or the rules apply differently in Canada, and if so, I apologize. But I would like to have all my bases covered. I switched from sole p to incorporated within 6 months-and not only the first time, as a business, I did that also back in 1991. I think I would look into that if you haven't already to read the pros and cons. Especially as large as VANA is-the other 2 sp's-I am unaware of. My two american cents again!

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