Learn basic bookkeeping and accounting in QuickBooks Online
The QuickBooks Online Accounting API lets you access most of the customer-facing features small businesses use to do their accounting.
In this guide, we’ll cover basic accounting concepts. If you’re looking for info about our API and how it’s modeled, here’s an overview of the QuickBooks Online Accounting API.
QuickBooks Online gives users powerful tools to track all of their financial activities. Here’s an overview of a few fundamental features small businesses use everyday in QuickBooks:
- Sales forms let them start and track sales transactions.
- Lists keep track of their customers, vendors, inventory, etc.
- QuickBooks records and categorizes transactions into financial accounts.
- All of those financial accounts make up their chart of accounts.
- The general ledger keeps a record of all their business activities.
QuickBooks is based on double-entry bookkeeping. This is a very common accounting system in the US and many other countries.
With double-entry bookkeeping, all records involve two (or more) related accounts. Accounts serve as reference points for transactions. Any time a user creates or updates a record in QuickBooks, it increases the value of one account and decreases the same value of a corresponding account. For example:
- When a small business sells a product or service, its “Cash” account increases by the profit from the sale. The income account that tracks income from sales also increases by this amount.
- Additionally, if the business sold a product, the account that tracks product inventory (usually called the “Inventory Asset” account) decreases by one item.
- When a small business pays rent, its “Cash” account decreases by the amount spent. The expense account that tracks rent expenses, in this case called the “Rent or lease” account, increases by the same amount.
Since double-entry bookkeeping tracks both increases and decreases, businesses get a comprehensive view of their finances. Learn more about double-entry bookkeeping.
If you need a more detailed conceptual overview, here are some recommendations:
- Learn common accounting terms from QuickBooks Online Support
- Learn about basic accounting from the QuickBooks Resource Center
- Learn about basic bookkeeping from the QuickBooks Resource Center
As an app developer, you may want to create tools that streamline one or more accounting tasks into a seamless experience for end-users.
Accounting involves many interrelated tasks that follow specific sequences. We can call these groups of tasks “workflows.” Some workflows involve only a few tasks while others involve more than a dozen.
We’ve created guides for common workflows you can use as foundations for your app.
Creating and sending invoices to customers, adding items, accepting payments, and more
- Create invoices
- Add items to invoices
- Assign income and sales accounts
- Email invoices to customers
- Receive payments for invoices
Creating and analyzing financial reports
- Run reports
- Customize reports
- Understand reports types (balance sheet, profit and loss, year-end reports)
Creating items (inventory, non-inventory, service), tracking quantities, reordering, and more
- Enter items into QuickBooks
- Create inventory items
- Create invoices for inventory items
- Understand cost of goods sold (COGS) and quantity on-hand
Creating bills and linking bill payments
- Create bills
- Assign expense accounts
- Create bill payments to pay for bills
- Add vendor credits for excess payments
Creating and managing acocounts and customers so you can associate them with transactions
- Create accounts
- Assign account types and detail types
- Enter customer info into QuickBooks