In this tutorial, we’re going to cover how to enter bills in QuickBooks that you receive from vendors. Entering unpaid bills allows you to stay on top of your accounts payable balances. This is important to ensure you pay your bills on time to maintain a good credit history with vendor suppliers. Let’s begin!
You can watch the video above and follow along with your own QuickBooks Online account. Don’t have one? Sign up for a free 30-day trial.
If you’d like to learn more about managing income, expenses and reporting in QuickBooks download our free 39 course QuickBooks tutorial here.
Download Our Free QuickBooks Course
Why Entering Bills in QuickBooks Is Important
Vendor suppliers that extend credit to you will send you a bill that should be paid by the due date indicated on the bill. In order to stay on top of these unpaid bills, you need to enter them into QuickBooks. By entering bills into QuickBooks, you can stay on top of your accounts payable balances. One of the many reasons why business owners purchase QuickBooks is to gain better control over their expenses.
By entering bills in QuickBooks and paying them as close to the due date as possible (without being late), you will have better control over your cash flow. It is beneficial for a business owner to hold on to cash as long as possible. You never know when an emergency might occur and if you don’t have an available line of credit or cash in your bank account then that emergency could ruin your business.
How to Enter Bills in QuickBooks Online
Entering bills in QuickBooks encompasses three easy steps. After logging into your QuickBooks Online account, navigate to the enter bills by clicking on the plus at the top of the Homepage. Next, select “Bill” which is located below the Vendors column. Enter the details of the bill such as date, amount and a description of what was purchased. Save the bill and review it for accuracy.
Follow the three steps below to enter bills into QuickBooks Online:
1. Navigate to Enter Bills
After logging into QuickBooks, you will click on the plus sign located in the upper right portion of the screen. Then, you will select “Bill” from the vendor column. We have included step-by-step screenshots below.
From the Homepage, click on the plus sign at the top as indicated below:
Click on the Plus Sign to Navigate to the Vendors Center in QuickBooks Online
Below the Vendors column, select Bill, as indicated below:
Navigate to Enter Bills in QuickBooks Online
2. Enter Bill
The Enter Bill window will display on your screen. There are several fields that need to be completed. These include the vendor, payment terms, bill date and due date fields, among others.
The Enter Bill window you’ll see in QuickBooks Online is shown below:
Enter a Bill in QuickBooks Online
A brief description of the information to include in the (above) fields are:
- Vendor: Select the vendor from the drop-down.
TIP: If you have not set the vendor up then you can do so here. Just click the drop-down arrow and click Add New. In the Setting up Vendors tutorial we walk through step-by- step to show you how to set up your vendors. - Mailing address: This field will automatically populate with the information that is in the vendor profile. TIP: If you did not enter the mailing address for your vendor then this field will be blank. You can enter the mailing address in this field but it will not update the vendor profile.
- Terms: The payment terms will automatically populate with what was set up in the vendor profile. TIP: If you did not set special payment terms for a vendor then this field will default to the payment terms for all vendors. During the Setting up Expenses tutorial, we walked through step-by-step to show you how to set default payment terms for all vendors.
- Bill date: This is the date that appears on the bill you received from your vendor.
- Due date: Based on the payment terms, QuickBooks will calculate the due date for you. For example, the payment terms are Net 30 for this vendor. This means the due date will be 30 days from the Invoice date.
- Account details: If you are paying for a service such as utility expense or tax preparation services, then you will need to complete this section of the bill. However, if you are paying for a product, then you will complete the Item details section.
- Item details: If you are paying for a product, such as a piece of equipment you will use in your business or inventory that will be sold to customers, then you will complete this section of the bill.
- Product/Service: From the drop-down menu, select the product or service you are paying for. If you have not set up the product/service then you can do so by selecting Add New from the drop-down menu. In the setting up products and services list tutorial, we walk through step-by-step to show you how to set up the products and services list.
- Description: This field will automatically populate from the product and services list. You can also type a customized description directly into this form. However, it will not update your product and services list.
- Quantity: Indicate the quantity of your purchase, if applicable.
- Rate: This field, containing the per product or per service cost, will automatically populate from the product and services list. You can also type the rate directly into this form. However, it will not update your product and services list.
- Amount: QuickBooks will multiply the quantity column by the rate column to calculate this field.
- Save: Once you have completed all of the necessary fields, save the bill.
- Bill no.: This is the invoice number that appears on the bill you received from your vendor.
Tips When Entering Bills in QuickBooks Online
To help prevent you from paying for something twice, it is very important that you enter the bill no. (invoice number) for all bills. Typically this will be a unique number issued by the vendor. If a vendor does not include an invoice number on the bill, then you should come up with a unique number.
By entering the invoice number, QuickBooks will alert you if a duplicate bill no. (invoice number) has been entered. This feature can help to ensure that you do not pay a duplicate invoice that the supplier may send to you. In the Advanced Settings tutorial, we walk you through step by step on how to turn this feature on.
3. Review Bills
After entering bills into QuickBooks Online, you should review the bills to ensure they are correct. First, navigate to the Vendors center and click on the vendor that you enter bills for. On the next screen, all the bills that have been entered should display and you can review the information to ensure it is correct. We have included step-by-step instructions below.
From the Homepage, select Vendors from the left-hand menu bar as indicated below:
Navigate to the Vendors center in QuickBooks Online
On this screen, you will see a list of vendors along with the open balance. Click on the vendor’s name in the first column to go to the next screen as indicated below:
Vendors List in QuickBooks Online
Outstanding Invoices by Vendor in QuickBooks Online
You can see the details of the outstanding invoices that make up the open balance as indicated below:
That wraps up how to enter bills in QuickBooks Online. In the next section, we will show you how to make changes to a bill that was previously entered into QuickBooks.
How to Make Edits After Entering Bills in QuickBooks
On occasion, you may need to make a change or correct information for a bill that was previously entered into QuickBooks. You can edit any information when you enter bills in QuickBooks as long as it has not already been paid. If a bill was paid for the wrong amount, you will have to request another invoice if you owe the vendor money or request a credit memo if you overpaid the bill.
Follow these steps to make edits after entering bills in QuickBooks Online:
1. Navigate to the Vendor Bill
To edit a bill, navigate to the Vendors center by clicking on “Vendors” on the left. In the next screen, select the vendor. A list of bills for the vendor will display, select the bill that you want to make changes to. Be sure to save your changes. We have included step-by-step instructions below.
From the Home page, select Vendors from the left-hand menu bar as indicated below:
Navigate to Vendors Center in QuickBooks Online
On the next screen, you will see a list of vendors along with the open balances. Click on the vendor’s name in the first column to go to the next screen as indicated below:
Open Vendor Balances in QuickBooks Online
Now you can see the details of the outstanding invoices that make up the open balance. If you hover your mouse over any of the information right below the column headings, you can click to display the bill on your screen as indicated below:
Details of Outstanding Bills in QuickBooks Online
2. Edit Bill Information
The bill should display on your screen as indicated below. Make any necessary changes and then save the bill:
Edit Bill Information in QuickBooks Online
What Impact Entering Bills in QuickBooks Has on Financial Statements
There are three types of purchases you will generally receive bills for. Overhead items such as utilities, fixed asset purchases, and inventory purchases for products. Overhead items, such as utilities, should be posted to an expense account, like utilities expense. However, purchases for fixed assets and inventory items will be coded to an asset account.
Entering bills in QuickBooks for expenses, inventory, and fixed assets will have the following impact:
Entering Bills in QuickBooks for Expenses
When entering bills in QuickBooks to pay for expenses (e.g., office supplies or utility expense) the accounts and financial statements are affected as follows:
Account Affected | Impact on Account | Financial Statement |
|---|---|---|
Accounts Payable account | Increase | Balance Sheet |
Expense account | Increase | Profit & Loss |
Entering Bills in QuickBooks for Inventory and Fixed Assets
When entering bills in QuickBooks to pay for an asset like equipment or product that will be added to inventory, the accounts and financial statements are affected as follows:
Account Affected | Impact on Account | Financial Statement |
|---|---|---|
Accounts Payable account | Increase | Balance Sheet |
Inventory asset/fixed asset | Increase | Balance Sheet |
Frequently Asked Questions (FAQs) About How to Enter Bills in QuickBooks Online
We have compiled the most frequently asked questions about how to enter bills in QuickBooks Online. If you don’t see your question, visit the Fit Small Business Forum and post your question and one of our industry experts will reply to your question.
The most frequently asked questions about how to enter bills in QuickBooks Online are:
How do you enter bills already paid in QuickBooks?
To enter bills already paid in QuickBooks, you’ve got a couple of options to choose from. First, you can manually enter the bill into the check register that the bill was paid out of. However, the best option is to connect your bank account to QuickBooks. This will automatically download all bill payments into QuickBooks.
What is the difference between a bill and an expense in QuickBooks?
In general, a bill is an expense or purchase of an asset or product that has not been paid for. Bills represent money that is owed to vendor suppliers and must be paid within the payment terms set by the vendor. However, an expense generally refers to something that has already been paid for.
3. How Do I Import Bills into QuickBooks Online?
QuickBooks Online does not have the capability to import bills. However, you can purchase an app that will allow you to easily import bills into QuickBooks Online. In the past, I’ve used Transaction Pro Importer/Exporter and it worked great. You can visit the Intuit apps store to see all of the options available.
Wrap Up
Now you know how to manage bills in QuickBooks Online, you should have no problem adding new vendor bills and editing them when you need to. Plus, you have learned the impact expenses, inventory and fixed asset purchases have on the financial statements. In our next tutorial, we will show you How to Pay Bills in QuickBooks Online.
Our Recommended QuickBooks Apps
