Xero Cloud Accounting Basic to Advance Training

1. Introduction to XERO: Welcome to Zero Cloud Accounting Ultimate training course, which is a perfect place to master the world's leading accounting software. Hi, I'm Sad, an ACC qualified accountant with over ten years of experience in accounting and finance. In which I have helped all sizes of businesses implement Zero Cloud accounting software and streamline their financial process. And I'm really excited to guide you throughout this course. Unlike other courses, which just walks you through the functionalities of zero, just like you are understanding it theoretically, this course is completely different because it is completely project based. So in this course, we will take the scenario of a company which is completely transferring all of their accounting on zero. So this involves a complete and entire process. From creating a new company to setting a chart of accounts, we will cover each and every single step in this course. We'll also learn how you can create the customers, vendors, and inventory with the opening balances to start the business operations in zero. Now, once the system is up and running, we'll dive into the deeper understanding which involves day to day transactions and how we can deal this in zero. This will give you a hands on experience on how you can apply the practical knowledge in your job or in your business. Now, this course doesn't involve a theory. You will completely implement zero just like you were using a real company. So from day one, you will be able to implement all of these things which you learn from this course into your business or in your job. Now let's take a summary of what we will cover in this training. First of all, we will learn how you can set up a zero trial account so that you can practice and follow along as I show you each project. After that, we will take a scenario of a trading company where we will take a scenario that a company was operating for many years, but they were working manually and they haven't implemented any system yet. So we will take an example of that if you want to implement completely from scratch, Zero Cloud accounting software what you need, so we will be configuring the chart of accounts and customers and vendors that the company already had. So we will enter all of them in zero then we will put their opening balances to completely implement the system. After that, we will cover not just the basics, we will cover every single thing like managing the purchase returns, managing sales returns, and handing the inventory. If it is damaged, how will we treat and offset that. And we will also learn how you can receive the partial and the full payments again the customers or a supplier, and also we will learn some of the adjustments like bad debts and so on. We also learn some important concepts like prepayment accrued expenses and all the essential topics that you will need in your accounting. And by the end of the training, we will cover some essential topics in the frequently asked question section where we discuss some of the advanced features of zero Cloud accounting in which we will learn how you can import the complete bank statement for the reconsideration purposes in zero, and we will also learn the complete bank reconsideration process, VAT returns management process, and all the other advanced functionality like configuring the sales invoices, designing customized reports, and so much more. So don't miss this chance to become an expert in zero because this course is completely designed practically to gain hands on experience in the software. So let's get started and learn this amazing software. 2. Create Xero Trial Account: Right. In this video, we are going to see that if you want to create the trial account on zero to practice on, what steps do you simply need to take in order to create your free account? And don't worry. You don't need any credit card information to be entered. It can be simply logged in right away. Just you need a simple information about yourself, about your company, the phone number, email address that you will be using, and you are good to go. So all you have to do is just go to google.com, and right here is zero. And the first website that will appear is the official website that is www zero.com. Just go in here. And on the top corner, you will see this try 04 free icon, click on this tab. And as you can see here, no credit card required 247 online support and you can cancel any time. This is a 30 day free trial, and we will learn this software on this free trial version so that you can practice and follow along. I'll just quickly mention my details. So I mentioned all of my details, first name, last name, email and phone number, and also mentioned the location. So just click on I have read and agreed the terms and fuse and if you want to read that, you can read that as well. And if you want to receive some marketing communications on the latest promotions, you can do that as well. Otherwise, just click on I'm Not robot. Click on Next. Make sure your phone number is valid. I'll show you this message, then on this email, we have sent an email for the confirmation. Just click on the next steps, and just you need to do is just follow the next steps, and that is verify your account, click on the link in the email to verify your account and start using zero Trial account. So let's quickly do this. So let's just quickly move to the email and just click on here where we have received the email from zero. You're already active. It says there is already a user for this email address that you want to log in to zero. So in that case, if you've already subscribed and the subscription is expired, what you can do is use the TAMP email. Just try using the TAMP email, and that should work as well. Let's check. TAMP email. Now the purpose of temporary email it is just a disposable temporary email that you can use to enter your data on some websites. Whenever you need that, and you will also receive the inbox emails here just to confirm that. So you can use that on any website. Let's say to create a trial account or something like that. And let's quickly do this again. Here I'll mention the new email and the number. And let's see if it works. L on confirmation, it will send you the email here, and let's see. After some time, we will collect the email here and we can see that the confirmation email is received. Yes, it's me. Let's get started. So you can just mention any password that you like to activate your account. We have mentioned here. And update the password. And guys, make sure that if you're using a temp email, just copy it somewhere else and just copy and piece the password as well so that whenever you want to login to Zero account, you will need to use that email and password. So as you are using this one, let me just copy this to clipboard, and I'll just quickly create my new Word document. I will mention my email and you can mention your password. So whatever it is, just save and close. And, guys, after doing this, it will finally take you to this screen. So just follow this video till this point, and I'll see you in the next video where we will add the business and start our Zero Cloud account. 3. How to Create a New Company in XERO: In this video, we are going to see how to relogin in your zero account and also how you can create a new company in zero Cloud accounting. So let's get started. So here we are going to take an example that we have already created the account, and now we want to relogin. Let's say you went out after turning off your laptop, and then you just open that and now you want to open it back. So all you have to do is just go to zero.com, and here you will see again, login here and just enter the email and the password. So I'll just quickly add my email and my password, and let's click on Login. After that, you will be prompted to save this. You can save, and it will take you to exact same point where you left. So in the previous video, we have learned how you can create the zero trial account. And as soon as we have created that, it has asked you to add your business. So let's continue with this. And in this complete course, we are going to work on the practical assignment of a trading company so that you can get the better knowledge of it. The company name is Elie traders, and it has a business of buying and selling car parts. So these are the car parts. We have some opening balances. We have some customer and vendor balances. So basically in this example, we have considered that this company might be using some other software like say Excel or even let's say they're doing the manual bookkeeping or accounting, and now their work is expanded and they are planning to shift on a computerized accounting system. So we have recommended zero for that. So in order to implement zero Cloud accounting, what we need to do is they need to close their financial years manually, and the closing of the last year will become the opening of this year. So let's say they will finalize all the receivables, all the creditors, stocks, land and buildings, whatever they have. And then we will take that example and then we will create that letters with that opening balances from the starting point and then we will move forward. So this is how we do it. Now let's see how we can implement this. So the company, our business name is Elite traders and the industry, as I told you that they're dealing with the car parts services. So let's write parts here. So it says motor vehicles, new parts wholesale, motor vehicles, parts retailing. So we are dealing with this business. We will choose the industry and just choose the country. Let's say this business is located in United States. So does it have employees? Let's say, yes, we have employees as well. What tools are you currently using to run your business? So it's just getting the history of how you were maintaining your books before. Let's say we're maintaining it on spreadsheets. And let's start the trial. And you can see on the top that we have 30 days left for your trial, and after that, you can buy that subscription. So that's enough for learning this software. And on the left, you can see a setup guide which welcomes you to zero. So you can see the videos, which will guide you through the zero dashboard. We will do it all over on the practical assignment and not in the theoretical way. So let's just close this, minimize this, actually. And this is the main dashboard that you will see after you have created your company. So that's pretty much it, guys. This is how you can register on the zero accounting software and create a new company in zero Cloud accounting. Stride it by yourself, and I will see you in the next. 4. Customizing General Settings For Better Management: Guys in zero Cloud accounting, if you want to avoid the mess of finding things and you can't find it in the menus, and you're just confused how the heck you are going to include or exclude some of the functions in your dashboard or your menus. So settings is the key here to avoid all of this mess. So in this video, we are going to see how you can set up all the general settings in Zero Cloud accounting. So let's see. Now, if you want to go to settings just on the corner, you can see this Elite traders option. Just click here. You will see the settings here, the files here, subscription and billing. And also, in the meanwhile, let's say that you're working on Elite traders, and you feel that some of the functions you need to try before you implement it on the real company. So all you have to do is just click on the demo company and you will be move to a sample company with a sample data as well. So that would be very nice if you want to, let's say, try to extract some reports and you don't have data in your actual company like we do. So you can just go to the demo company and extract those kind of reports and see how it works. So anyways, now we are going to see how you can make the settings. So let's click on settings here. Here you will see two parts as we can see this is journal, and we have a couple of functions in journal. And as the name suggests, it is related to the overall features or settings of the company like logo addresses, add or remove users, currencies and all, and we have the features option. So for example, invoice settings, payment services, email systems, all of things like that. So we have two sections here. In this particular video, we are going to explore journal features, the journal settings, and then we will explore the features. For example, I want to add a logo of the organizational details or let's say we didn't enter the address of the company or some basic financial information, so you can just click on organizational details. And we will see this kind of screen here where we can upload the company logo. So let me just upload my logo here. Just go to the location. This is my logo. And by the way, guys, the assignment and the logo, all of these files that I'm showing you in this training will be attached in the course. So just go to the resources section of this particular video or the course project files, and you can get it from there. So the logo is now set. The display name is light traders. This is the legal name as well. And the industry we have already selected that. This is motor vehicles part retailing. The organization type is, this is a sort proprietorship. So business registration number, if you have any kind of official registration number to appear on the documents, you can just write it here. So let's take an example of something like this. An EIN number, let's enter an employer identification number or a Social Security number. Let's actually take the support of hat GBT here if you don't have those numbers and you want to enter it for the sample company, right? Example numbers are right here. So this is, let's say my EIN number, although it's very simple one, two, three, four, five, six, 789. So let's paste this. Actually, we can ask it to give random real kind of numbers. So this one is better, copy this and just go here and paste. Same thing. Social Security number, let's copy this and paste it right here. And if you have organization description, you can use that as well. Write organization. Description of car parts, business, let's say. So if you want to write all of this description, you can just write it here no longer than three and words. So let's try this or actually, let's try this. That's fine. Now, for all of this contact information, it's pretty straightforward. But what I've done here, I have taken the support of Chat GBT here as well. And we will quickly fill in all the information because this is just pretty straightforward. But we can just quickly fill out all the details search address, postal address. So the postal address, this is the postal address. Just copy and paste this the street address. Let's say this is the street address, town zip code. I'll quickly fill in all of these details, the relevant details, and then I'll show you further. So I have filled in some of the information. Although it's not necessary, you can just enter the required fields as you can see here, this is the required field. This is the required field, and these are all the compulsory fields. Rest, all of them can be entered later. So you can just skip that as well. So let's save this and all the changes are saved. This is how we can enter all the organizational details. Let's go back to organization settings. Now let's see the next one, and that is very important feature that is users. You can add, remove or modify users to this organization. So let's say that you want the zero to be used by different people that can work on the same company. So what you can do is just simply add or modify the users. So right now only I am the current user. So let's say if you want to add more people to it to the same company and they can perform different functions, for example, one of them are working on sales, one of them are working on the payments and the owners using just the reports. So all of them can use the same software. You have to do is just click on Invite a user and just quickly mention all the details about this. For example, let's me try to invite myself and add a personal message projects, allow this user to access the projects, and this is the limited Admin and limited access, all of them. Uh, business and accounting allow the user to invoice and billing and all. So these are different kind of user access rights. You can set according to your needs, you can even set it too. Let's say they can only create the drafts of the invoices and not the actual invoices. So you can make all of these settings according to your needs. Let's keep it standard for now, let's click on Send Invite. Now, the Invite is sent and it is spend. So we have moved to our email, but as you can see that we haven't received any request on the inbox. So in that case, we might have to check the spam emails. And here we have received this invitation. You are invited to join Elite, Twitter, Zerounting. So from here, the user will click on Except Invite, and they will be able to join on the same company. After that, whenever different users login in your zero Cloud accounting company, you can just click on Login history, and you will be able to see at what time different users are logging in and out. And the last thing is, let's say that you want to delete any user. So just have to go to the three dots on the right corner of that user and click on Dlete the user and yes, delete user. And from the same area, you can change the permissions. Now let's go back and click on Organization settings. And now you can also change the currencies in zero. So for example, if I go to the currencies, and let's say my main currency is US dollar. So let's say if I want to use some other currencies, you can just quickly add the currency from here and let's say the other currency is Euros. So it will automatically pick up the latest rate and you can add it to the currency, and here you have it. So let's say we have some foreign suppliers, and we want to convert the payment. So these exchanges that automatically updates will be pretty helpful for you to calculate the latest prices on the conversion. So if I click on Add currency and let's say there is some currency, there's not in there, although we have a long list here. So you have all the frequent currencies to be used and all the other long list from where you can find any single currency out here, and then you can simply add it. Now, let's go back. And let's see an other amazing area that is only available in Cloud accounting softwares and especially in the zero Cloud accounting. And that is the feature of connected apps. This is a pretty awesome features. For example, you want to accept the payment directly. What you can do is just go to apps. And just discover the apps. You can search for, let's say stripe payments, search for Stripe and you can just select that and you can get this app and attach it to your software. So you can not only connect this stripe, you have a lot of apps option. So for example, if let's say I want to go back, we have to go it from here and let's say Zapier. Zapier is an amazing automation app, so you can integrate that in zero accounting as well. So you can just imagine the power of the connected apps feature. No, I'm not going to get into much details here because this is the part of completely separate topics. Each app has an extensive functionality, so we will be focusing just on the zero Cloud accounting. And the next one we have is the subscription and billing here. So, for example, you have tried zero in detail, and now you want to manage subscriptions since right now we are on the 30 day free trial plan, so you can just manage the subscription from here and you can upgrade your package. So you can easily upgrade the subscription from here. Let's say that we are in trial, so you can just click on By now. And then you will be able to see the different packages. So whatever you want to choose according to facilities offered by zero, you can just check that on and click on the add ons that you want and select the billing account and you are good to go. So let's go back. So that's it, guys. This is all the journal settings that are available in zero. Very powerful settings. You can just explore it on your own, as well, and I will see you in the next. 5. Customize Feature Settings in XERO: All right, now that we have already explored one part of the settings, let's explore the other part and just go to the settings, and now we are going to explore the feature settings in zero Cloud accounting. So you have all the amazing features like invoice settings, payment settings, email settings, you can also customize the printing styles and all of that. So let's explore this one by one. So let's go to the invoice settings. And here you can customize all the things that you want to show on your invoice. Also, you can choose any branding theme or choose the payment services or set the invoice reminders here. So when we open the new branding theme, we have the option of standard and custom. Now, on the right hand side, you will get this button right here, which is a drop. You can customize all the settings here that you want to see. So for example, if I just want to preview this existing invoice format, so all you have to do is just click on Preview, and then you have the default preview of the invoice. But on the top, you have two options right here. You can also see how it will look on a mobile rather than a desktop. So it will look on a mobile, something like this, and on the desktop, it will look like this. So let's close out of that. If you want to customize it further, just go to the options and click on Edit, and then you will see all the individual changes that you can make. So for example, the default branding name is standard, you can change it to let's say my custom invoice. And let's say you prefer A four size, and on the top and the bottom margin, you want to adjust it all of them 2.5, let's say. So you can adjust the settings here. Also, you have the choice to change the font. Let's say I want to make it Calibri and the font size should be, let's say, eight, now, you can also customize the titles of each invoice. So for example, the draft title would be draft invoice, approved invoice title will be invoice. But let's say if you want to change it to final invoice or something like that, you can easily customize that, and it will be printed like that. So overdue invoice title will be invoice, because obviously we don't change the invoice titles for every single thing, whether it's approved or overdue, it will still show invoice on the front of the physical print. Similarly credit note title will be credit note, statements, and let's say de title should not code, but quotation. You want to use the full name, so you can customize that. Similarly, receipt is set to receipt, and similarly, all of these names can be customized. On the right hand side, we have the show text number option. So if you don't want to show the text number on the front of the invoice, you can just uncheck this, and same thing goes for the column headings show item code. Let's say I want to show the item code as well, along with the inventory item itself. So we can do this if you want to hide the discount, you can do this. Otherwise, you can how it. Similarly, whatever column you want to hide, for example, I don't want to show the text column. Instead, I want to just show the total text at the end of the calculation. So we can customize all of them according to our organizational needs, and then it asks you to show text subtotals by a single text total or text rates over 0% or text components or single text subtotal. So whatever you like here, you can choose that. On the logo alignment, you can also align the logo towards left center or right, and you can show text as exclusive, inclusive whatever you like. And the contact details should be appeared like this. But if you want to customize this to print on the front of the period of document or a physical print, you can customize there as well. You can also mention some terms and conditions if you want to mention it on your invoice and statements and just save it. Now let's explore the default settings. Now, default settings is all about the payment terms, so it is pretty self explanatory that you can set custom payment terms for individual contacts. So for example, it says bills default due date. Let's say that whatever we purchase, there is a 30 days of the following month due date or let's say after the bill date, 30 days after the bill. If you set it to month, you can set it one of the following month. So after one month, it will be due. But if you want to set it let's say 15 days, so let's say after the build date. Now, same thing goes for the sales invoice. Let's say we want to collect them in ten days. Whatever we sold on the credit to customers, we want to collect from them in ten days. Now, the invoice prefix. Now, this means that whatever invoice you are creating, it will automatically write I and V in front of every invoice, and the next number will automatically be produced based on the invoice sequence. So let's say the next number, let's say you are implementing a software, and you want to follow the series that you are already working on. So, for example, you have already issued in your business like this much invoices. So the next number should be 1152. So now if you set this number, it will automatically start from that number only. Same thing goes for the credit note prefix, purchase order prefix. Again, if you want to start it from a specific number, you can specify that core prefix. Now in the purchase prefix, same rule will apply. For example, I want to start it from let's say 55, and core prefix should also start from let's say ten. Now the next thing here is show outstanding bills, include a link on online invoices to show all outstanding bills for a contact. So let's say you publish the online invoices to the customers, so they can just simply click the link and check their outstanding bills. Also, de expiry date. That means that you have given a quotation to the customer that we will charge these prices for these items, but that is available for a specific period of time because the prices keep on changing, right? So in that case, you can just set it that these prices are valid for, let's say, 30 days from the de date. And let's save it. Now, whenever you make any changes and you can exit after saving it properly, just go to the default invoices again and make sure that all the settings are properly saved and then click on save again. This is just to double check everything that's working fine. Now, let's explore this third option that is payment services. As I explained to you, that you can get paid faster by giving customers more ways to pay. So what you can do is you can just directly attach all the payment methods so that they can directly pay. You can link the payment services to the invoices directly and get paid and receive your money. So all the popular gateways are supported here. You can attach the Visa card services, Mastercard, American Express, ApplePay, Google Pay, and you can also include stripe or other methods here. Since in our example, we're just working on a practice trading company, so we will explore this later on. Google organization settings here. Now the next one is email settings, and it says set a reply to email address and email template content. So, for example, if you want to set a specific content that you want to apply, you have eight standard templates. So if you click on Edit, you have the invoices templates. So for example, whenever you want to send the invoices by email, you have the basic template here and it says something like this. The invoice number will be mentioned automatically from the business, your trading name is due. Attach the customer link, customer name link Hi XYZ. Here's the invoice number with outstanding bill. The amount outstanding is this, and view your bill online. It says all of them like this. So if you want to customize it even further, you can just write your own text. Let's say, I'll be happy to help you, something like this. And save. You can include more placeholders like amount due, first name, last name, contact name, currency code, whatever you want to link. All of that fields that you use in your invoice can be easily linked here. And you can also customize the name, let's say, you can write it my sales invoice template, something like this. Once you have finalized everything, just click on Save and go back to the screen. Now it says seven standard templates, and one custom template to save because we have made a couple of changes, right? And the Taylor email sent from this organization as you are logged in user, emails are sent using the name of Sanadem with replies going to this email. So if we click on this, you can add some other email address, let's say, a professional one, your company email address, and you can use that to send your emails. What you can also do is you can create your own email template. For example, you can choose this and what type of email template it is, let's say, repeating invoice template. So it will choose all the default information that it picks up from here. And now you can just customize this and mention your own name. Let's say, repeating custom invoice template. Now, this will not change the existing one, rather it will create a new custom template. And here you can write anything you want, any information you want to add, any information you want to subtract, and any placeholders you want to add it to, you can just freely customize this without worrying to change the default one, and you can include this action to online invoice and detailed summary. So let's say you want to send it directly from the invoice, you have to keep it checked. And let's say that after finalizing this custom template, you want to make this one as default. So what you will do is just simply default, set it so that it will be available to send from any invoice, and then you can just delete the other one or just hide the other one and click Save. So right now, I have not finalized this, so let's save it. Now before we had eight templates in total. Now we have nine. One, the custom template that we have just created from scratch, and the other one is what we customized. Now, let's go back and explore the new one, and that is check styles. And it says customize how would you like checks to be printed? That's interesting. So let's say you have a specific pay order style or the bank voucher style. By the way, you need to contract with the bank. Let's say you are paying to any of your customers via a specific template that you extract from the software. So you have to mention it to the bank how you want it, and it will be printed something like this. Let's save it, and let's view it. So this will be the check format that you can use and customize to pay for your bills. And let's say if I want to edit this, you can just reposition anything you want according to the check template. So for example, you are using the standard chartered bank. So according to that, you can just adjust the fields. You have to make a couple of cries for that in order to fit this properly. So in that case, all you have to do is just take many printouts of, let's say, standard chartered bank, check copy. And just cut that printout in the check style, cut out all the extra parts, and just put it in the printer and just try a couple of times. And let's say, adjust it a little bit every single time. So whenever it fits everything properly, then you can just finalize that. So save it from here. I'll not save it for now, but you can customize all of these details. Now, let's go back and let's explore the new option connect with other zero users to automate invoices and bills. So here you have the network key, and what is the purpose of it zero to zero. Let's see you connect directly with other businesses who use zero, allowing you to exchange invoices directly in and out of the zero accounts. So how awesome is that? So what it is used for, let's say that me and my customer both are using zero accounting software. So what I do is if we have the network setup and both of the systems are linked up, what we can do is simply let's say I issued them a sales invoice, it will be automatically updated in their accounting system as a draft invoice. So what is sales invoice for us, they will be purchased invoice for our customers. So that will be saved as a draft. They will just firstly review and then save it simply as a purchase invoice. So they don't have to enter that over and over again, and same thing applies to us. Let's say we and our vendors are using the same software. So if we have the network linked, whatever is purchases for us will be sales for them. So when they enter their sales invoice, it will be automatically updated as a draft purchase invoice. We will review it and save it directly without needing to adding that again. So how cool is that? It will be very convenient for you to set up this kind of system with other businesses provided they are using the same zero software. Now let's go back again. And the last feature we have is custom contact links. So you can create the shortcuts of your favorite contacts and other tools. So what basically it does is you can just create a custom contact link of any customer, any supplier, or any kind of ID, API code, whatever. So this is your basically go to facility. Whenever you want to quickly access it from the dashboard, you can simply create a custom link here. So let's say if I want to create a custom link of the contact ID, you can just save it. Right now, we don't have any kind of contacts, so that's why it's showing this error. Otherwise, you can just link it to different kind of deals. And you can also create a custom link here which can redirect you to a particular website. So that's the purpose of it. So this is it, guys. This is how you can set up different features settings under the organization settings of Zero Cloud accounting software. Just write by yourself, and I will see you in the next one. 6. Adding Bank Accounts in XERO: All right. Now, if you want to create the bank account in Zero Cloud accounting software, it's very simple. What you can do is just find the accounting tab and you will find the bank accounts option there. Now, depending on the year you're watching this video, it might be some changed option or you might see it in a different position. But most of the time, it will be found in accounting tabs. So just click on the bank accounts here. And here you will see a guide on the top of it. I've just closed that. But if you have no banks, you can click to add it from here. Now click on Add Bank account. Now, guys, if you are working in United States and you are using one of the popular banks in United States of America, like Barclays Bank, Citibank, whatever, so you can even connect it to Stripe and PayPal. And what it will do is zero provides you a facility to directly connect it to a particular bank. What it can do is it will directly connect to the bank and import all the banking transactions directly into zero, which will be very time saving for you and very awesome features. So let's select, for example, we are using the Barclays Bank. It will take some time, and it will show you this option connect Barclays Bank to zero. It says, zero partners with YOL to securely import your banking transaction. Now, this is an intermediary party which handles all of these transactions. So it creates a secure connection between the bank and 02, and you can securely enter your username and password. So if you agree and continue, it will connect it to your bank. Since we are just taking an example and we are not working on actual data, you can just skip it and click on Don't Create My Bank, and still, you will see this screen right here where you can enter your bank details and then simply save it. Now, since I am not using Barclays Bank, I'm just taking an example of the Eli traders. So let's take an example of that, and we are using standard chartered bank. So let's set up again. I just showed you the popular banks example. Now we will enter our actual bank that we need add the bank account, and let's copy and paste that name from our assignment. And like I said, this is not a popular bank in America and it's not supported in zero, so you can add without the bank feed. Click on Continue if you're using some other bank in some other country. Just write the bank name here and the account name is standard chartered bank. You can mention the branch name as. And it's not credit card, it's other. You can just mention the bank account number, so something like that, for example, and the currency, you can enter your default currency. So like I said, we have set up the multiple currencies in the earlier videos, so it's showing multiple currencies here as well. But we are taking the example of US dollar, so we will choose the US dollar. After we finalize everything, we can just click on Add account, and it will be added like this. So if you want to manage it further, you can just go to the right corner, and here you have all the features that you can work on in your default bank. You have the fine section, new section, and reconciled section. In the Find section, you can find the accounting transaction or banking statements. You can extract. You can click on spend money, receive money, transfer money. So these are all the features that will be used to enter the transactions. Let's say you have making some expenses payment or some payments to the suppler, you can use this reconcile, you can use all of these reconcile features. So just a summary, we will see everything in much detail here. Now, also, let's say that you have already created the bank, and now you realize that there is some mistake with the number or some name. So what you can do is just directly go to manage account and click on Edit account details, and you will be able to make all of these corrections and then save it. Now, similar thing that if you want to create a credit card account, you will do the same thing and you will choose the type as credit card. But in this case, in my assignment, there is no credit card account. So we will create the other account that is United Bank Limited. Don't worry if you think that we are not following it in sequence, we will see all the features one by one, and then I will connect all of them what we have learned into this assignment, and we will finalize this assignment. So now we entered this, but there's no option here to add this. So all you have to do is just go and find it to the top here. Add without a bank feed, click here, click Continue. And here you have to paste this bank name, bank name. This is not a credit card. So if it is a credit card, all you have to do is just choose a credit card here. And this is the account number, some random one, and this is also a USD dollar account. Click on Add account. And now we have two bank accounts added. Now, the other thing that we want to add from our assignment is the cash account. And we have this much balance in the case. So let's enter that. We will go to the add bank account because the banking and the cash nature is both the same. You don't even need to put in the search list because we can just directly add without a bank feed. Click on Continue. And although it says bank here, just write cash in hand. Because the nature of bank and cash, as I told you before, as well, it's same. It is used for the payments and receipts. So cash, other account type, just mention all of this number as zero and the currency is US dollar at the account, and that's it. Now that we have created all the accounts, how will we add the opening balances in that? Also very simple, go to the accounting tab, and here you will go to Advance. Again, you can have it in any sequence, depending on the year you are watching this video. So just go to the Advanced tab and just go to the conversion balances. Now, if you don't want to go in that particular area from the Advanced tab, rather you want to see it directly on here. So what you can do is just market as favorites and after that, you will find the convergent balances directly here. So before it was like this, you only have two ones, and when you market as star, you will find this third one as well, so you can directly go in that. Once these accounts are created, you can just put then opening balances in here. So now let's put these opening balances in here. You can just simply remove the ones that you do not need right now. So for example, we need only these three. Now, what you can do is just put the balances here. Let's say cash in hand. Let's copy and paste this balance, paste this right here, double click and paste it. And now the standard chartered bank just copy and paste this, and we have the United Bank copy and paste this as well. Now as we can see that total debits are increased, but the total credits doesn't match that. So if you try to save this, it will be saved, but you still need to balance it. If we click on the accounting here and just click on conversion balances, it's great thing about zero that it still saves it, even though we are not balanced on the grade side. When you want to show all accounts, you can just simply click here, and let's say you have many accounts, but all of them with zero balances, so you can just remove the zero balances account, and you can again see only these. After we have finalized all the balances in here of the banking, what you can do is just to confirm that, go to the accounting and banking accounts, and you should be able to see all of these balances right here. And now we want to transfer between the bank accounts, for example, you want to transfer the money from bank account to the cash in hand. So all you have to do is just transfer the money here. Just mention the account where you're transferring from and just mention it to where you are transferring that. Mention the amount and the reference. That transaction. Let's say I want to transfer $500. And on that particular date, you can transfer by clicking just directly here, and you can transfer and add another transaction if you have a couple of more transactions as well. But since we will just follow the project we're working on, we will cancel out of this. And that's pretty much it. This is how you can add the bank accounts and also enter their opening balances in zero. Just wide by yourself, and I will see you in the next one. 7. Creating Chart of Accounts: Right now that we have included some of the banks in the Zero Cloud accounting software, it's important to learn how the other chart of accounts need to be entered. Also, if you want to include the text details or set the web details or set the financial year from first of January to 31 December, let's say. So how we can adjust all of this. So let's see. Now, in order to create the chart of accounts, or configure some text settings, we need to go to accounting tab, and under the accounting tab, if you want to see all the options, we can just simply go to the Advanced tab. Now, under the Advanced tab, we can see two sections, one on the right, one on the left. The left is for advanced features such as if you're managing your sales tax settings or fixed asset settings, you can use these options. But let's explore on the right hand side, and the first one is financial settings. So if we go here, we have the option to change the fiscal year. So let's say in some countries or in some companies, the financial year is not actually first of January 31 December. It may be starting from first May and ending on June. So in that case, you can just change it from here and you're good to go. Similarly, your tax basis is either cash base or accrual base. So if you're managing the sales tax for your business, you can choose these options. And in that case, as you can see that if I change it to none, all of these other tabs are removed or other fields are removed. But if we change it to cash or accrual basis, so we need to enter a couple of details, let's say, like text ID number, text ID display name, and text period. Now, especially if you're maintaining the text details in your business as well, it's important to lock the dates. So in that way, whenever you have finalized, let's say sales tax for a particular year or particular quarter, after that, you want to fix the dates so that no one can go back and change any of the transactions because it will directly affect the sales tax report. Once we have done all of these changes, let's click on Safe. And in this case, let's actually change it to none and click on safe. And actually, if you want to go back, just click on the advanced accounting option right here. It will take you back. Now let's explore the most important option, and that is chart of accounts. You can add, edit, archive, delete or import and export your chart of accounts. So we are going to learn all about it. Let's go to the chart of accounts. And by default, if you have selected any type of business in the starting when you created the compag zero, it will create some of the chart of accounts that is essential for that type of business already in the chart of accounts. As we can see that we only created these chart of accounts, right? But as we can see that there are other extensive list of chart of accounts as well. So what you can do is if you really want to create all of these start of accounts, first of all, what you need to do is just make sure that whether this account already exists or you need to create it from scratch. So most of the time, some accounts that are commonly used is already existing in the chart of accounts list, so let's check. So for example, debtors receivable. If I try to find it here and you can't find it, what you can do is either you can change the category. Right now, we are in all accounts. You can go to the particular section in which you are trying to search that. For example, the receivable is an asset, right? So we have to go to the assets. And under assets, you can find the receivables right here. But if you have extensive list here as well, what you can do is if you're, let's say, in a particular section, but still it has a lot of list. But you can write here is the exact chart name, chart of account name, and just search for it. And there you go. This is account receivable. Now, same thing. Now what we will do first is we will confirm all chart of accounts, and if they exist or not, if not, we will create some new ones, and then we will learn how we can put the opening balances. So let's search for creditors, vendors, or let's say, in this case, zero has accounts payable name. Let's search for it, and there we have it. The account code is 2000. So it depends on the company nature. They can set their own type of chart of account coding. Now, next one is inventory or stock. Now, it's not compulsory to have chart of account exactly matching the name what you have in the assignment or project. So let's say in this case, it was creditors and vendors, right? But I search for accounts pable. So you have to see some different possibilities for it before you create it. So even though let's say if you're trying to find it with exact name, if you can't find it, just go to the liabilities and manually search for it because sometimes it's mentioned with other name. Now, next one is stock wt. So let's write stock first. All right. Let's go to the assets, and let's search manually. Now, we have the inventory asset as an account, so we also have this one. So let me just select all of these and actually highlight these. This one is done, this one is done. And this one is done. Now the next one is land and buildings. Now here we have the fixed asset as computer and office equipment and accumulated depreciation for it and vehicles and accumulated depreciation for this one. So I believe this land and buildings need to be created. So add an account. Now, by the way, guys, you can mention it as buildings and property because land is separately amortized and building is separately charged as depreciation. According to International Financial Reporting Standards, these needs to be recorded separately. So you can either write buildings at cost and accumulated depreciation of buildings. So let's click on Add account. Just choose the category, and the category sequence of the assets is one. So let's say we want to place it somewhere here. So 15, 30, 15, 31, 15, 20, 15, 21. So let's make it 15 40, 15, 41. Okay? That's cool. So 15 40 is the name. Make sure that it says this code is available. If it is a duplicate code, it will let you choose that. So you have to change that. So let's write here, buildings at cost. And you can put any description or leave it blank. It's completely optional. And right now in this particular assignment, we will see that all of these transactions are text exempted. I'll show you the text calculation separately. So just don't worry about that. Show on dashboard watchlist show in expenses claim enable payment to this account. So we will keep all of the options as it is. Just keep it basic. What we have only done is we have changed the account type, the code, and the name, and that's it. Save it. Now the next one is accumulated depreciation of land and buildings. Now, guys, whenever the depreciation is charged, it is charged as an expense, but it will reduce the overall asset cost, so it is negative asset. The accumulated depreciation of land and buildings is a negative asset. Just keep in mind. I hope you already know that if you are already familiar with the accounting. Whenever the depreciation is charged against the fixed asset, depreciation will be debited as expense, and credit will be that particular asset account. But if you want to categorize it separately to just keep the records of the depreciation, we create a separate negative fixed asset account that is accumulated depreciation of Landon buildings. If you want to learn more about this, you can just Google it about accumulated depreciation of the fixed asset. All right. So in this case, we will just click on Ad account, fixed asset 15 41. And the name will be. I'll just copy this name, but to copy this, I need to uncheck this. Now let's copy this. And by the way, this browser which I'm using to open this PDF file is simply Microsoft Edge browser. So as we can see here, if I minimize, this is Microsoft Edge. So it's a lot of functions. You don't need any PDF reader for that, you can simply use this one. So it's also you can put any descriptions if you want, but I'll just copy and paste the same name, and list of the configuration will be same. Let's click Save. Right now we are not putting any balances. We're just checking for the completeness of all the accounts. Now, next one is motor vehicles. So motor vehicles is already there. It's your choice. If you want to configure or rename it, let me just show you how to rename it. So this is account right. So just open this and it is already in the editing mode. So what you can write is, let's say motor vehicles, you want to change it. And even if you want to change the code, you can do so and click on Save. Same thing. For the accumulated depreciation, let's make it motor vehicles, and click Save. So this one is also done. Let's choose this motor vehicles is done. Accumulated deprecision of motor vehicles is done. Next one we have is machinery and accumulated deprecition of machinery. So let's choose that. Now we can follow the same sequence as we have in assets. So let's make it 15 51 and 15 50. Let's go here. 15 50. This is available, and we can simply just copy this. We have machinery. Save it, and let's quickly create an other one which is also fixed asset, but it is negative in nature because this is equbilty depreciation of machinery. So let's place a code here as well, which was 15 51. Let's place the name and save it. Now, these ones, the other cash Bank and United Bank account, we have already created all of them. So let's highlight this so we can note the progress until this point. And now is the time to enter the accrued expenses. Now, guys, accrued expenses is simply what is due on you, but it is not paid yet. So this is our liabilities. So for example, you have hired some employees in your company, and the salary is due on that particular month, let's say, March, but you pay the salary on April. So in that case, if you want to make that salary, the part of the March, even though it is not paid, what you can do is just write here debit as salary expense. And since it is not paid yet, what will you credit? Because this is the main part of accounting system that everything exists in the double entry form. So credit should be salary payable. And when the salary is paid, salary payable will be debit means liability will be reduced, and against this, cash will be given or the bank will be reduced. So in that case, accrued expenses is all about this accounts payable or expenses payable. So let's search for the liability section maybe it will already exist. Just go to the liabilities, and actually let's write it here, accrued. If you don't find it, don't just straightaway create. You can just search it manually. Now, if it doesn't exist, you can create that. Click on Add account. Now let's choose the category carefully. As you can see that we have the section names as well. For example, assets, we have the section name as assets, and all the assets are here. Under the liabilities, this is a current liability, right? So let's say I want to place it under 2120, so it will be in the middle of this point. So 2120. Is available, let's copy and paste the name. Copy and paste here as well, and click on Save. And the last one we have is capital invested. Now it's net owner's equity or you can say capital invested. You need to go to the equity section and check if you have the owner's equity account. So let's say this one. This is owner's capital, but I'll change this name to Net owner's equity. Let's click on Save. Now, our chart of accounts, what we need to create as an opening chart of accounts and their balances, which we will put in the next video are created. Now, if you go to the all accounts, we can see that the ones we created as bank accounts is here, but the code is not here. So we can manually place it, open it one by one, and you can place any code here. So, for example, thousand, this one is 1,000. This one is 2000 or let's say 1,500, and this one is 1,800, let's say. Now, guys, you will notice that I have given all the codes with one series and not like 2000 1003 thousand. That's because there's an international rule for all the accounting softwares. Most of the accounting software follow the same sequence that account codes that starts with one is for assets. As we can see here, one is all for assets, two is for liabilities. So we can see two is all about liabilities, three is for equity, so we can see three code or five and six is for expenses as we can see here. Four is for revenue. Now, we haven't checked the revenue yet, but I believe it should be starting with four. So as we can see here. Now, this is not about zero Cloud accounting software. This is same for all of them. So if you learn it, learn the coding, you can easily understand the coding sequence of any accounting software, whether it's QuickBooks, whether it's zero, Mob, whatever. Actually, what we can do is check it here on JABT as well. I've asked him to write chart of accounts coding sequence for most of the accounting softwares. Let's see. Now, as we can see, it has written something about that to explain this. Here's the typical coding sequence used by many accounting software broken into sequence. Account type main account, 1,000 to 9,000. One is for assets, two is for liabilities, three is for equity, four is for revenue, five is for cost of sales and six and seven for expenses, and department wise configuration should be like this. And it has explained to you in much detail. Let's say if you're using SAP or Oracle, they might be using the full de sequence like this, which mentions the department, location, project, and job as well. So basically the simple accounting codes will be in this sequence for all the accounting software. You can write on chat Gibity and just note it anywhere to properly learn this. It's pretty simple. One is for asset two is for libraries and all. So what I want you to do is just write all of this in hatibit and it will extract the coding sequence for you. Just memorize this so that you can easily understand the coding rules of all the accounting software. So, guys, that's pretty much it. I want you to do and complete until this point, create all of the chart of accounts, and then we will move to the next video where we will learn how we can put the opening balances in all of these chart of accounts 8. Entering COA Opening Balances: Eight. Now we have entered all of the chart of accounts in zero, but we haven't put the opening balances. So let's see how we can put the opening balances of all of these chart of accounts in zero. So what we can do is just go to the accounting tab and click on Advance. And from here, the most important area you need to focus on is the convergent balances. Just click on that. It says update account balances from previous accounting systems, right? Now, as we can see that we have all the chart of accounts showing right here, if you want to see all of them, right now, we can only see three. But if we click on Show all accounts, it will show us the list of all. And also the once we have already entered the opening balances off, it will be shown and updated right here. So let's enter the opening balances. All right. Now we will place the balances one by one. But we will leave the debtors that is receivable, creditors, that is payables and stock that is inventory. Why? That's because we need to see that when we enter the customer individual balances, for example, on this opening date, we need to receive some money from the customers as well. So on this opening point, when we are converting from, let's say, manual accounting to imputized accounting on zero, have these opening balances, and out of which, these are customers and we need to receive these amounts from them. So we will see that when we individually entered the customer details, whether it automatically updates the receivables or we have to enter it manually. So as we can see here, the ones we want to receive from each customer, the total of that is hundred 95,000, so this is the total of that. So that means it should be a control account. Same goes for the vendor and inventory. We have the individual vendor with the balances, and the total balances is as an opening balance in this particular ledger. Same goes for inventory. This is the inventory. The total amount is this, which should be updated automatically in the ledges. So let's continue with this land and buildings and all. So whenever you want to put the balances in a particular ledger, as we can see, we have a lot of list, so it's easier to press Control F here and right here land. So, we have configured it as buildings. Now we can see that it is highlighted. We can simply go here and you can also copy and paste it simply from here. Just put the balance here. Now the next one is accumulated depreciation of buildings at cost. Just copy and paste this one. Now, this one is a contra acid, paste it here. Next one we have is motor vehicles. Just copy here, and search for motor vehicles. This is motor vehicles, paste the balance. Accumulated depreciation of motor vehicles. Let me just space the balance here. And let's say this is machinery and their balance is here. Let's space it here. One we have is cash. Now, Cash, standard Chartered Bank and United Bank is already updated. What we need to do now is update the accrued expenses. So let's search for accrued expenses now. So as we can see that if you just try to find it randomly on the list, it will be very difficult for you. So either you can use this search feature, just press Control F. This is not the zero Cloud accounting feature. This is just simply the browser feature. So just press Control F and right here, accrued expenses. Otherwise, you can locate it in two category because two is for liabilities. Let me just place the balance here. It right here. Now, as we can see that some of the ledgers are still pending and needs to be entered, now the debit and credit side won't match, as we can see here. The total debits is this amount, and the total credit is this amount. It just means this account for the difference and for FX gain and losses. This is the difference between the two. So if you try to save it at this point, the good thing about zero is it will currently save it at this particular point so that we can see it later. So I want you to enter all of these opening balances until this point, and then we will move to the next video. 9. Updating Customer Records In Xero: All right, guys, now that we have updated all the ledgers and their opening balances apart from the debtors, creditors, and stock, because we only want to see that if we enter the individual customer details and their balances, will it update the overall balance as a receivable or not? So let's see. So if we want to enter it manually, what we can do is just copy the contact from here. And from here, just go to the contacts and make sure you select the particular customer or supplier and not all contacts. If you want to enter customers, you must go to the customer section, so that way you make sure that you enter it all properly, and it's shown in the same section. So click on New contact and just paste the name right here. If you have the account number, you can paste any account number right here. You can paste the first and last name. It's pretty simple details. You can even ask Chat GBT to provide you all the details for zero contacts. Just copy and paste the contact names and it will generate the contact for you. So this is the sample information. You can enter the business information, the country area number website, all the details about that customer. Now, the address is very important billing address and delivery address. We have two addresses here. So sometimes what happens is your customer wants to send you the bill on the accounts office that is a different location than the delivery address. So you will enter both of these addresses here so that it can be shown on the invoices, and it will be very helpful for you and the delivery person as well. So the financial details, if you want to connect it with the financial records and you want to receive directly payments in zero, you can enter the account details, routing code, and all so that we can receive that. And the text details, text on the income tax return, copy from the contact name. So this is pretty simple. This is what they will provide. You can just simply enter all of these details, whether it's SSN, ITIN, whatever. So this is all about it. The sales default, whenever you make the sales or enter the sales invoice, what account should it hit? You can choose that. So in this case, I have chosen 4,000 as the sales account. But if you have different income streams, you can create multiple sales account and then choose accordingly. But since we are light traders that only deals with car parts, so we will choose this one. Now invoice date, we can choose anything like 30 days after the invoice date. So it will automatically put the due date whenever we entered the invoice. Also, if you want to enter amounts are exclusive of text or inclusive of text, whatever, you can choose that setting. But in this case, we will see the text details later on. We will keep it as simple as possible so that you can fully understand the software. So in Elite traders, we will charge no text. And the sales tax is tax exempt. You can also enter some discount policies which you have decided from the customers, and you can enter the credit limit, let's say, after a certain amount of the credit is standing against that customer, you can just put that and after that, you can just block new invoices from entering. So let's say any person is entering all the invoices for you, they won't be able to enter if the credit limit has reached. Now, zero Network E, like I told you in the starting, that if your customer is also using the same software. What you can do is just connect with the customer. So in that way, whenever they purchase invoice because what is sales for us is purchases from them, right? So when they enter that, it will be automatically updated and can be updated in the records of yours. So the purchase default, similarly, we want to choose the inventory because we will be purchasing inventory in most of the cases. But right now, I'll just choose this cost of goods sold. And 30 days after the build date, text exclusive and text exempt. Now, you can save close, but you will notice that it didn't ask you to enter the opening balances against this customer. Now, whenever you want to check that, for example, if we are on our dashboard and we want to check the details, let's click on Contacts and click on customers. Here, you cannot see any customer here. Why is that? Because this record only shows what you owe or they owe to you. So that's why it's not showing the details. But if you click on A, you can see this customer right here. Now, as we have seen that you won't be able to put the opening balances when you create the customers from the contacts. So what we can do is just go to the customer and create some new contacts as well, and then we will see how we can put the opening balances. So let's just quickly enter rest of the customer details. The next one we have is Albert. And let's put our random account number. The primary details, we will leave all of these as it is, and just move straight to the sales and purchases area. You can set it to 30 days of the invoice date, no tax and text exempt, and purchases should be set to this 30 days after the bill date, no text and text exempt. That's it. Save and Close. Now let's enter a new one. Now let's go back. As we can see in the all contacts, you will find these contacts. Just click on the new contact. One we have is Victor. Let's leave it all as it is, and just move straight to the sales and defaults area. And we have mentioned all of these details right here. Just go here, choose this one. I'll just quickly fill in all of the details same as the above. And whenever you save it moves to that contact, but just click on contact from the top and you will see this page. Now the last contact is only remaining for the customers. Just move down. Et's choose this one. Let's choose purchase defaults now. I'm just fast forwarding the process because it's exactly the same. So let's click Save. And this is how we click on contacts, and this is how we enter all of the customer details. So just enter all of the details until this point, and then I'll see you in the next one. 10. Importing Supplier Contacts in XERO: In the last video, we have seen how we can manually enter all contacts, whether it's customers, suppliers in Zero Cloud accounting. All you have to do is just go to the new contact and enter all the basic information, including the address, financial details, text details, sales, default, and all. But what if you have a lot of contacts and you want to import all of them? So in this video, we are going to see that if I want to import, let's say, vendor details because customers we have already entered, now you want to enter the vendor details. So all we have to do is just go to contacts and click on suppliers from here. And if you see on the top, we have these three dots parallel to the new contact, so we will choose this one. Just click on Import and the download template is provided by default and zero. You can read the instruction how to fill out the template. Let's click on Download the template and just save it to the convenient location. In my case, I've chosen desktop. Now let's go to the desktop and just open this. Now, it has all of these details. As we can see that we have approximately 74 fields. So obviously, these are a lot of fields and we don't have the data for all of them. What we only have, we can edit that simply. So for example, you just want to input the contact name, and that's it. So these are the contact names. This is contact name. Next one, we have this. I'm only trying to show you this one. So for example, account numbers, you can just copy and paste that or if you have an existing Excel sheet, you can just put it in here because this is the template that we will be using. So just copy and paste that account number that we have it here. This email address, last name. So whatever in that Excel sheet is present, you have to put it in the sequence in the relevant column. So you can search all of this. This is Skype name, bank account number. So again, it's not necessary that you have all of these information. Only the ones you need to enter, you can just enter it here. So Dubil day, due bill terms, you can enter all of these details. So let's say I want to import these two contacts only with the account numbers test. So let's save it. Save the template. You can also make the copy of it so it won't affect the original one. And now just use the simple option of import contacts. We are already in the import contexts. All we have to do is just select the file that you want to upload. This is my file, click Open. On importing an existing contact, empty fields will be ignored. So if we have some empty fields like we had there, it will be ignored. And even if we have the fields that is blank between the data, it will ignore that, or if you want that you want to import the customers all over again, let's say we have entered some of them, but now we straightly want to import it together from the Excel sheet. So in that case, you might want to delete the existing information. You can do that, as well. After that, just choose your preference, click next, and it says here, two new contacts will be created. Complete the input. Warnings have been made here that you haven't mentioned these column details. So obviously, we don't have all of these details. That's why it's showing this caution. If you click on complete Import, we will see the results as we can see here that the other two details are entered. Daniel, here's Daniel, and here's an. So that's it, guys. This is how we can import the contact information zero, write by yourself, and I'll see you in the next one. 11. Entering Customer Opening Balances: All right, so far we have learned how you can enter the individual customers and vendors by either entering it manually or by importing it. Now we are going to put the balances in the customers and suppliers. Now, the simple method to put individual customers balances and supplier balances is just go to the accounting tab and click on Advanced here. Now, under the Advance, our area is conversion balances. Now, if you noticed before when we completed all of our chart of accounts with their balances, we only entered and put the balances of only these ledgers. We didn't enter receivables balance, creditors balance, and stock balance. Why? Because that is connected to individual party accounts or individual ledgers accounts. Means account receivable hundred 95,000 is the total of each individual customer with their balances. For example, we need to receive from Justin 85,000 Albert 30,000 Victor, 65,000. So this makes the total 295,000, which is exactly this balance. So what we're trying to achieve is we are trying to just enter the individual customer balances, and it should automatically be updated in 195,000 as a control account. So let's see what is the solution in Z. So as we have seen here, when we entered the contacts, that means customer and vendors, there was no option to enter the opening balances. So how will we enter the opening balances? That's from here. Now, first, it looks like we need to enter all of the balances, and it will not be connected with the individual customer balances. Let's click on Show accounts if you can't see any particular letter, and now we can see account receivable. Now let's directly put account receivable as if we didn't find any option. So the last option is just enter this 195,000 right here. But as soon as we try to save this, what it will do is it will show you this entered invoices sent on or before 31st December 2023 that have not fully been paid. So balance is out by 195,000. It says that you need to add sales invoices to bring this balance to zero. That means we have entered the receivable without any supporting document. So we need to cover that with the invoice. So let's click on Add invoice. Let's write in here. And the issue date was 31, December 2023. Let's keep it as it is, and we want to make it opening as of first of January, so we can make it first of January for the next month as well. And invoice number will be this reference number will be, let's say, opening balance. And here in the description, we also need to write anything. So let's write the same. Justin. And the account and everything, it will automatically choose when we write the amount here. So let's write 85,000 press tab, and as you can see, it automatically selected other ones. So now we will just click on this dropdown and click on Save and Add Another because we need to enter a couple of more customers right. So the second one we have is Albert, choose it. Same procedure, first month opening balances. And the amount is 30,000. Press tab before saving, and then click on Save and add another. Now the next one is Victor, opening balances. Put the description. And let's put the amount here. Click on save another and now the last one. Is Walter, first of next month, opening balance, I'll put here as a description and right here amount, which is 15,000 and click Save. Now, all of these are entered. What I'll do now is click on Save and Add Another, and now I'll just move back to the convergent balances from here, and we can see that now if we try to enter this 195000, it should allow us to enter, and that's exactly what is shown here. Same procedure will be repeated for the accounts pable. But that I'll tell you in the separate video, first, I want you to enter all of the sibs and backup with the invoices in the background for the customers. Now, if you also want to check at this point, the chart of accounts, you can also go to dashboard or otherwise, just click on Accounting from here and click on Chart of Accounts. And here you will see this balance is updated here. And when we want to see the details, let's say on this balance, I'll click I can see individual customer balances backed up. So that's exactly what we want. The only thing you need to consider by yourself whether you want to consider the opening balances as of first of January 2024, or you are fine with this date. So either of the thing is correct for you, so just try it by yourself, and I'll see you in the next one. 12. Updating Vendor Balances: All right. In this video, we are going to see that if we want to update the vendor with their balances, how we can do this in zero as an opening balance if we want to enter that. So the procedure is quite simple. All you have to do is just go to the accounting and click on Advance and under the conversion balances, since we have taken an example that we are working for a company called Elite traders, were working before in Excel or some manual accounting system, and now they want to convert it into zero Cloud accounting. So they have entered all of the opening balances of each ledger with their balances. The only thing which we have intentionally left is debtors receivables, accounts payable and the stock. That's because it is connected to the individual parties. So when we update individual party ledges and balances, it should automatically update. Until now, we have entered all of these ledges with their balances. Now the next part is we have done four receivables. Now let me show you how we can do this for accounts payable. Right, payable here. We can simply use the Control F feature and it will take us to this one. Now we need to simply enter this balance. Let's suppose that we just enter this balance. What will happen? Let's see. So when we enter this balance, press tab and click on Safe, it will show us and take us to the point of bills where it asks you to enter the invoices received on or before 31st December 2023. That means right at the start of the next year, that means opening balances. So balance is out by 130,000, and it suggests you to add bills or credit notes to bring this balance to zero. So it says that account payable cannot stand in. What you need to do is just pack it up with some bills. And that's exactly what we wanted here. So let's click on Add Bill, and this is the first one. Date is this one, and let's make it due on first of January. Reference number is opening balance. Now, in the opening balances, we don't have any inventory items at this point, only the accounts payable balance should stand. So we will not choose any item, rather we will just write directly write here in the description about opening balance and just directly put an amount of 50,000. Let's put it in cost of goods sold for now. You have to write 150000 and it will show you this total figure here. Now, let's say if we don't enter this, it will still automatically take and pick the ledger of cost of goods sold. So let's click on Save. In fact, we will click on this drop down and click on Save and add another because this was the first one. Now we are going to enter the second one, which is CN. Let's put here opening balance. Put the description about the same. Let's put one here and 80,000. Know it looks a little weird to enter the balances like that, but this is the only option in zero, so you must follow that. So let's click on Save and return to the list or, in fact, go to the conversion balances. Now, let's locate this accounts pable right here. Here it is 130000. And now if we try to save this, it will allow us to save it. As you can see here. Now, the only difference we have is 4396 730, and that's about 4396 730 exactly of the net owner's equity. So we will only update it once we enter the inventory as well, and then we will move to it. So I want you to enter the vendor details with their balances and just match until this point, save it here, and then we will move to the next video. 13. Updating Inventory Records in XERO: All right, now that we have entered the customer details and the vendor details, the next thing that we want to enter is the inventory details with the items and put their opening balances which should exactly match with this control account, which is the stock total balance right here. As we can see here, the balance of the stock in the trial balance is 453000, which is shown here as individual inventory items. Each quantity rate makes up the total of each inventory item, and the total is up to this 453000. That is the balance of the trial. Let's see the few steps how we can create this. First of all, we have entered some inventory balances here. If we make it zero, let me just make it zero here, and let's save and close. Until this point, I want to make this adjustment and make the inventory zero. If you have already made the inventory or put the balances in accident, you can just change it manually. And now let's suppose that we are on the dashboard. Let me make it full screen. Now, from here, I'll just go to Business and click on Product and Services. And under the product and services, as we can see here, there is no list because this is a freshly started company. So let's click on this button here which says New item. Just click on this, which will take you to this setup area of the new item. Now it's your choice. You want to add IT 001 as code or whatever your company decides, and then we can put this inventory name. The first is Carla windscreen. So let's put it right here, Carla windscreen. And if you want to track the inventory item, that means you want to keep the record of the stock in hand. So that's exactly what we want here. We are maintaining the inventory for this business. We track the inventory, we sales and purchased the inventory as well. So click on Track inventory item. And when we click on Track inventory item, it shows you that when you have the opening balances as an inventory item, it should be placed. So all the inventory asset account is linked to the inventory asset. So that is perfect. Bills, make sure that the purchases and sales are already checked before you click this one. Otherwise, it will not be clickable after that. As we can see here, it changes something. So if you track the inventory, the purchases are different. So if you don't track the inventory, the purchases will show differently. Let's suppose you don't track inventory, the purchases will change to purchase account. That means you can simply enter the purchases account here, something like that. But when you track inventory, everything becomes different and the inventory asset account is required. The purchase will directly go to the cost of goods sold and all the sales will go to the sales account. So something like that. So let's choose the cost price at which our inventory was here. So the opening balance is always at the cost price, let's choose the cost of goods sold account. The description is already mentioned here. And at this point, we don't know the sales price, but still we will put the sales here and tax exempt. Sales price, we will not select any sales price here, Carla windscreen, and that's pretty much it. Let's click on Save and add another. Now let's enter the second one, which is ID 002. Item name is Civic headlights. I track this inventory item, and let's put the rate here, which is this cost price, cost of goods sold account. Let's choose that. And let me just put the description here. Alright, sales price, since we don't know the sales price yet, so we will keep it as it is. And when everything looks great, just click on this area and click on Save and add another. Next one we have is Prius Val cups. So prius Val cups, okay? So just write I t003, and here we will write. Actually, let's copy and paste preus heel cups. I track this inventory item, and the cost price, the cost is this. It should go to the cost of goods sold. The sales price we don't know yet, so let's put sales. And when everything looks good, just go save and save and add another. And now the final one is the previous rear lights. So let's put the code here. IT 004. This is previous rear lights. Track the inventory item cost price. All right. The cost price is this one. Here, 200 and put it in the cost of goods sold. Description is mentioned. Sales price we don't know yet. Let's put sales tax exempt, and just click on Save now. Now, as we can see, all of the inventory details are entered. What we only need to do is now we will only learn how we can put the opening balances in that. I want you to create all the inventory items so that there is no confusion in entering the inventory. I want to follow each single step video by video. So just enter all of this until this point, and then we will move to the next video and enter the inventory opening balances together. 14. How to Record Inventory Opening Balances: All right guys, now that we have entered all the inventory details, but we haven't put the opening balances yet. So let's learn how we can put all the opening balances. Unfortunately, if we just click on here, there's nothing like that to enter all the opening balances. If we check Import, we can enter the opening balances from here. So we can import all of these, but we will explore the import part later on. First, we will learn how we can manually put it. So to manually put it, there is no single screen where you can enter all the inventory details on a single Excel like sheet. What you have to do is just open each individual inventory item and then just click on new adjustment right here. And from here, you can put the balances. It says adjustment type. I want to increase the quantity, definitely. If you want to decrease the quantity or make any kind of adjustment later on, even or if you want to revalue the inventory after the stock tick, you can just choose any of them from here. But as you can see that only this option is available right now because you cannot decrease the quantity once you don't have any quantity already. So just increase the quantity is available. So the first quantity is 470. Just make sure that you've selected the correct item. Carla windscreen is the item. 470, I want to increase the quantity. Cost price is 400. Let's put 400 here, which makes the new quantity to the same. And this is the opening balance, right? So first of January 2024, adjustment account, guys adjustment account will be the credit entry. Just make sure you put all the credit entries in opening balance equity or net owner's equity. Whenever you put opening balances, just remember that every other entry will be in the net owner's equity. And let's write opening balance here. Click on next, and it will show you the double entry effect of it. Just make sure that it is exact same amount shown right here, 188000 debit, 188000 credit, pose the adjustment. Now, similarly, let's go back, select the second item, go to new adjustment, increase the quantity and follow the same procedure. First of January 2024, increase the quantity by 950. I'll put 950 here. The cost price is 150. Which makes the new quantity this adjustment account, I'll choose this net owner's equity right here, and let's put a reference of the opening balance. And click Next and you can see the total adjustment amount. Just make sure it reconcils with this 1142, 500. And once this exactly same, just click on post adjustment and let's move to the next one, which is program services, just go to this preous el cups and click on this new adjustment right here. So this is preous el cups, increase the quantity by. First of January 2024, I want to increase the quantity by 250 and 50 is the cost price adjustment account. Now, let's put net owner's equity here and opening balance. Just make sure this amount is correct and post it. Let's click on New Adjustment again. Let's go back, and let's select the fourth item now and click on New Adjustment. As of first of January 2024, increase the quantity by 550. Adjustment account is net owner's equity. And I'll put here opening balance as a reference, click next and post the adjustment. So there we go. We have products and services all entered here. Now, if we go to the accounting and we want to check some reports, just go to the reports here. And let's say here right now, we want to just check the inventory report. So inventory item summary report or inventory item details report. It's either of your choice. So let's get on that. It says nothing to show here, but when we change the date here, we will see this. This is the complete inventory details all showing perfectly. And now if you want to adjust the opening balances as well, just go to the Advanced tab and click on convergent Balances. And now if you put the inventory balance, let's see if it enters straightaway or if it asks you for any adjustments. So let's say 453,000 is the total amount and click on save it easily save this because it's completely backed up with the inventory details in the background. So, guys, this is how you can enter it, try it by yourself, and then I'll see you in the next one. 15. Finalizing Opening Balances: Alright, guys, now that we have entered our inventory and their balances, and also we have cleared the vendor balances and the customer balances, so it automatically talies the opening trial balance as well. So let's check the opening balances one more time. If I go back here. And let's click on Convergent Balances again to see what it shows up. As we can see, we have the inventory assets here. So by the way, even if you want to confirm what is included in this 453,000, you can do so by checking the breakup in chart of accounts. So just go to the accounting tab and click on Chart of Accounts from here. And here, just search for inventory or you can just select the category you want. So for example, assets I want, I will go to the assets and just locate the inventory asset here is our inventory asset as we can see that it is recorded for two times. So that's why it's showing some different balance. So it's good that we have checked that. So if you click on this code, it will open up the configuration. But if you click on this balance right here, it will open up all the details. So because we have entered individual balances, of four items. So 188,140 2000 442,500 is there, 12,500 is there, but what about the other one? Let's see. So if you click on this conversion balance right here, and you want to delete this because we have already entered this can do is let's go to the accounting tab and click on convergent Balances directly from here. And what we will do here is just remove the balance from here and put it zero and click on Save. Now, once we click on Save, just go to the chart of accounts again to see what balance it shows now. So now if we click on the assets and search for the inventory assets, it's showing 343,000. That means one of the conversion balance is still missing. So let's configure the pres real lights as well. So we will go to the same area. Just go to the business here and click on products and service. Now, once we are in the inventory section, we must confirm that we have all of these balances and on the right dates. So we have the Corolla windscreen, which makes the rule of this amount, let's click on that. So its total is 188,000, and the balance adjustment is as of first of January 2024. So maybe there is some issue with the dates. So let's check the second one, Civic headlights. And this is the whole configuration. And if you scroll down, the date is first of January 2024, that is perfect. Let's go. And now we have the next one is Prius el cups. So prius el cups is also configured, right? The total value you can check here is 12,500 exactly matches our assignment, and it is also on first of January 2024. So as we have seen earlier as well, that issue was not about all of these, issue was about the pres rear lights. So let's see what is the issue with this. But we can see here, okay. Now as we can see here, the quantity on hand was mentioned, but the average cost was not mentioned. That's why it's not showing the total value. So how can we make all of these adjustments? We need a new adjustment. So, guys, we need to actually decrease the quantity. I'll just decrease the quantity first, and new quantity on hand will be this. So first of January 2024, net owner's equity, next. And the new everything will be zero here. Just post the adjustment like this. And now we can see here that we have reversed the adjustment and now click on new adjustment and increase the quantity. Now, as we can see the decrease quantity and revaluation is now again, blurred out, or you can say that it's disabled. Let's put the quantity here, 550, and the cost price is 200. Let's put 200 here. The new quantity is the same. And let's make the adjustment again to net owner's equity. And let's put the opening balance as a reference here. Click on next, and we can see the total value new total value is 110,000, which is perfect. 200 is the average cost, and the new quantity on hand is 550, all good, debit will be inventory acid and credit will be net owner's equity. Let's post this. Now we can just go here and check chart of accounts whether it's showing the correct balance or not. Just make sure before moving forward because all of the things will depend on the chart of accounts, individual balance, of course. So inventory assets is now showing at the valuation of 453,000. As we can see here, now it's completely talied. If we go to the convergent balances and check from there, we can see that under the inventory assets, although it's not showing right now, but when we post the adjustment, it will definitely show up. And how you do it. Now, I want you to make all of the adjustments like this and then move forward so that we can extract the opening trial balance report and make sure that it matches this report. So just try by yourself, and I will see you in the next one. 16. Extract Opening Trial Balance Report: Red guys, in this video, we are going to see that if you want to extract the opening trial lance report, that should match our assignment, which is this one right here. How can we do this? C. So to extract the opening trial balance report, all you have to do is just click on the accounting tab and click on Reports here. Now, from the reports, you can either find it right here or you can just scroll down until you see this point, which is Texas and Balance. Here, it shows trial balance. So if you mark it as favorite, you will see on the top as well in the favorite section. This is the area where you can just choose any frequent reports that you usually check, and it will appear here. So let's click on this trial balance right here. And from here, just make sure that you choose today's date or let's say, first of January. I want to show 1 January 2024 and the five columns is selected, we will keep all the other settings as it is, too. Let's just update it. And it is showing us this balance right here. All we need to focus is on debit and credit side. So just make sure one by one that balances are correct. We can just choose the edge browser to open this PD of file, and then you can choose the highlighted to individually match each balances. So for example, we will delete one by one. United Bank limited is 350,000. Let's just put here, 350,000. All good. So 350,000, market here as well. This is Det. Account receivable is showing as 195,000, so now it's showing properly done. Inventory asset is showing as 343000. So this is still showing some problems here. That's because we might have made some mistake in entering at the wrong date, I guess. If we check on 31st of December 2023, it's not showing any balance. And if we check first of January 2024, it's still not showing the correct balance. So all you have to do is, in this case, just go to drill down this and we can see all the dates here. So we have the adjustment of 142500. We have the adjustment of 12,500, and we have the adjustment of 188,000. So we still have a problem with this balance right here. Although we have corrected that. So in order to correct that, we need to check the Um, products and services again. So if I open this, it's showing it at the correct value, but it's showing it at the wrong date as we can see here. So what you can do here is just make the new adjustment with decrease quantity. We need to decrease the quantity to 550. New quantity will be this. Net owner's equity adjustment and the adjustment will be of opening balance. Click on next. And on the same date, we are reversing that. So now everything is now zero. Now let's pass the new adjustment. This time we will be very careful with the dates, as we can see here the impact of it. 200 is the cost price, and make sure to correct the deed first. So first of January 2024, net owner's equity. Now, guys, it's good that we are facing these problems in real time. Only then you can get the solution in proper grip on the software, how to resolve different issues in real time. So you might face the issues yourself when you practice on this assignment. So this is how you can resolve and make the corrections of it. So let's post the adjustments, and let's extract the trial balance again, make sure that the deed is correct. So if we go to the reports, we can now quickly access this via trial balance. When we set trial balance to, first of January 2024, it should show all the correct balances here. So as we can see now the inventory asset values at 453,000, which is exactly matching this area. So this was the most important area of matching the individual balances with the control accounts. So we are done with this. Sndard chartered bank is 1650 triple zero, 1650 triple zero, all done. Next one we have is motor vehicles, which is valued at 380,000. Let's quickly check this. Motor vehicles is valued at 380,000. All good. And accumulated depreciation is 445,000, sorry, 45,000, and building a cost is 750,000, which is matching here, then in buildings, accumulated depreciation all done. Machinery. Now, the machinery is valued at 290,000. This is the entry. This is its depreciation, 58,000. Cash in hand is 694 573-069-4730. All good. Accounts payable, short correctly here, as we can see. Accrued expenses valued at 53,000. That's correct. And now the historical adjustment, as we can see here, the net owner's equity was the cross reference here. So the remaining balance, we will put 4396 730. Basically, we need to settle all of this balance in here. So we need to transfer this either manually or through viewing the transactions. So if you click on here and we see these transactions, we won't be able to transfer it like this. So what we can do is just pass an opening balance adjustment here. Let me just quickly show you how. So let's note it somewhere. So 3943 730, 3943 730. All right. Now we need to pass the adjustment, right? So all we have to do is just reduce the balance from here. That means we will debit this account because this is a liability account, we need to reduce this account and transfer all the balances here in 3,000. Only then this will match the exact balance here. So just straightaway transfer this balance. Now, let's say that if we put the manual balance here, what happens in this case? Let's. Now what we can do is just manually post this remaining amount in the net owner's equity first, and let's save it. And as we can see, the adjustment is back to zero. Now if we go to the reports here and check the trial balance and set the date to first of January 2024, click on update. You can see that that was a temporary account. And when we meet this adjustment, it shifted all the balance automatically to net owner's equity here. And now our opening RL balance is exactly matching this. So this is a very important step, especially if you're implementing the zero Cloud accounting from scratch for a client or for an online project. This is very useful knowledge that I'm giving you right now to find all the freelancing work on different platforms. So this is the first step you need if you need to secure a bit project where you will implement the Zero Cloud accounting from scratch in a particular company. So just practice it by yourself in detail and just make sure that you have the exact same trial balance before moving forward. If you have any questions, just post it in the question section, and I'll be more than happy to help you and just complete all of this until this point, and I'll see you in the next. 17. How to Export All Financial Reports in XERO: All right, guys, I hope you have followed it completely and reconciled all the individual balances and party ledges together and just reconciled all the opening balances position and made sure that the customer balances vendor balances, inventory balances, and all the individual balances matches exactly here. So we have already checked our trial balance, and it exactly matches our account. So what I will also do is I'll attach this trial balance for your reference. Now, if you want to learn how we can export this all we have to do is just export it from here. You can also export it in Google Sheets directly on the Excel sheets and the PDF files as well. So let's click on PDF, and let's see how it looks. So I've saved the PDF at the desired location. Now if I want to open this, it will look something like this. So it's pretty decent report, I would say. But if you want to reorder the columns or remove some of them, you can try these options right here so that let's say that I don't want this comparative of the 31st December 2023, let's say. So in that case, we can just remove this compared with none and update. So that we have a cleaner look now. And now if you want to reorder the columns, you can reorder easily from here. How cool is that? So if you want account first, then account code, then account type, and then debit and credit, you can apply any kind of report type you want. And after that, you can just save it at custom Try Valens custom report so that you don't have to work on it over and over again. And you can also make this custom report as default. I would save it like this. This time, you won't only see this. We will just save it as the Excel file. So let's say now I want to access this custom trial balance report, how would I access this? As we can see the trial balance is already set to custom as default. So otherwise, you would have the option inside the trial balance to customize that. So it's already on the custom as default. Now let's say if I want to export it as an Excel file. I would click on Excel file and I have saved this. Now, let's open this, enable the editing. And as we can see, now we have this Excel file attached as the report. So you can find both of these reports with the resources section of this video, so you can check that out. This is all about the trial balance, reconciliation and report customization. Just try it by yourself. Tally with my reports that I have attached, and then we will start our day to transactions with the most important area in zero that if you've successfully implemented this, implementation simply means just transferring all the closing balance from the last year which was on, let's say, other accounting software or whatever, or even the manual closing. And putting it all as an opening balance in the new software. So we have already done that. That means we have successfully implemented the software, which is the most important step. And now, it says transactions during the month. So all we have to do is just one by one enter day to day transactions as if the system is completely implemented on zero, and now we just have to enter the day to day transactions on zero from now on because we have implemented zero. So just extract and customize all of these reports to make sure everything looks good, and then we will start our day to day transactions. 18. Purchase of Fixed Assets in XERO: Alright, guys, now we will enter the daily transactions one by one. And the first transaction is of third of January 2024, which says purchase furniture by giving cash. So we are purchasing a fixed asset for our business because our business is about the car parts. We are just buying and selling the car parts. So if we are purchasing the furniture, that's means, which is for the office use. If you are dealing in the furniture business, that would be our inventory, but this is the fixed asset, so we will record this. Now, in order to feed this in zero, it's pretty simple. All you have to do is just go to bills. So let's go to Business here and click on Bills to pay. And from here, we will enter new Bill. Now, since this is a one time purchase, just like we went to the market and just purchased the furniture from, let's say, a supermarket, so we will not record the supermarket as a vendor, right? So first of all, we will try not to add this from area because we don't want to specify a supplier name or we can specify it as journal purchases. So let's first see how we can enter this. So let's put the date here, which is third of January 2024. The due date is automatically set. We can just refer to it like 1001, whatever. And this area is used for the company main core business. That means if they are buying or selling the inventory or any kind of services, then you have to choose this one. If you're purchasing a furniture, you just directly use the description. Where you just copy and paste this description right here, and then you can simply put the unit quantity and price, and you can just associate it with the fixed asset. It's that simple and zero. So I know that you might be confused that why I'm using the bill option? Because if you already have an experience of quick books, let's say, you might have seen in QuickBooks that bills are only used to purchase inventory items or services. But here it is also used to purchase the fixed assets. As we can see here, we have the area here, but if we write furniture here, we can just specify that asset as well. And if we don't have that asset, don't worry, you can add a new account, and we just have to choose a particular area for that. So let me just select it as fixed asset. And the code I'll select is something like this. Make sure it is available. Otherwise, you just have to go to the chart of accounts and just select suitable code for you. And don't worry, even if you select it directly from here for the time being, you can always customize it by going to the chart of accounts. So let's write furniture here. And the description should be furniture as well, tax exempt as we are not considering it. Click on Save and we can see that now you can directly associate it with the asset account, the fixed asset account, and now we will just directly put the amount here. This copy here, copy this amount and paste it right here. If you have some problem wasting it, what you might need to do is just add a unit price right here. So this should make the total here. Otherwise, you can just use this area as well. Now click on approve and let's see how it is ended. Now, this feed, as we can see here, cannot be left empty. So in that case, you can just create a separate new contact, which is journal category. Ennal purchases, you can say, general purchases, and it's a new contact, and that's it. Click on Approve. And now let's track this fixed asset. If you go to the accounting tab and click on fixed asset right here. Now, let's choose the start date from here. Now, after you come in this area, you can see this purchase furniture by giving cache kind of entry in the asset number, and it's already recorded in the fixed asset register, but as a draft, as you can see here that it is recorded as a draft, if you want to change it to registered, all you have to do is just select this asset and click on register, but we need some more configuration right? That's why this option is disabled. So what you can do is just click on that. Just fill all the details, but before entering this, let me tell you that the asset type is not here available. And also, you don't have the option to make it. So that's why even if you fill the derails, you won't be able to save this. So what is the solution for that? That is a very important question, and all we need to do is just change the role of the user to advisory role. So when you create this, you are by default, an admin or an accountant. So we need to change that role. All we can do is just go to the Elite readers. Or company. And then just click on the subscriptions, and then just click on M zero from the bottom. When you see this company details and the excess is t to standard, what you can do is you don't have to do anything, just click on this and manage user excess. Don't just remove it, manage U excess for lit readers, and from here, you can see your current user, and it has the standard excess right. So what you can do is just go do this three dots right here and click on change permissions. And here you can see this role instead to standard. So if you change it to advisor, you will have much more areas of excess here. So update the permissions, and now just check it once again. So now we are set to advisor. Now if we go back to accounting, just go to the fixed assets. We can see the same area right here. But this time, we can just choose this and register this as it is as well. Also, we, let's say, fill in some details, some serial number. Although it's not compulsory now, we can enter it by divult as well, and now you can see how we can create a new asset type. So new asset type asset type will be, let's say, furniture and fixture select an asset account, furniture, accumulated depreciation account is we haven't yet created it, so we can just choose, let's say, right, let's leave it as it is. And depreciation method is, let's say straight line or declining balance method for the full month on useful life and useful life is, let's say ten years safe. So we must select some accounts here. So we'll choose the depreciation as an expense account. And right now the accumulated depreciation we have set to the furniture as well. So let's save it, and now we have the category or asset type save. So this is how you can create the asset type in zero. So now the asset name description, display all the details right here and you can simply click on register. You can specify the cost limit and all. Let's click on register here. And when you click on register now it's save in the fixed asset register now. So, guys, this is how you can manage the purchase of fixed assets in zero. So just write by yourself, and I will see you in the next one. 19. Handling Advance Rent: Next transaction is of four genu, and it says advanced rent paid for six months by cash at the rate of 3,000 per month. So the rent for, let's say, the office is 3,000 per month, and we have paid advanced rent for six months. Now, since you have paid the rent in advance for six months, you will want to first record the payment as prepaid expenses because all of these money is not spent yet. So rather than directly expensing it, this will be dealt in the prepaid expenses as an asset. This is because in the future, if you see on the last of the month, we will charge the rent for that particular month against the advanced rent. So if you don't have all the concept of prepaid expenses, if you want to learn in detail, you can just search it on Google and you will find an article 0N it. So you can refer to that. Now, how to enter this transaction is zero? Let's see. We will just click on accounting and click on bank accounts. Just click on the bank accounts from and whatever is your bank account, for example, we have paid advanced rent by cash right. So in that particular area, we have the cash as well. So in the manage account, you can see the spend money option here. So just click here. Now, in the two field, we can enter the building owner name or the landlord's name. So for example, you will just write office landlord, add it as a new contact. Now the transaction date is for January 2024, so let's enter that. Reference number, you can put any reference for now. We can write here 001, and or whatever your company policies, you can enter according to that. Now, just copy and paste the description here like this. Paste it right here and just choose the prepaid rent account. Now, if you click on here and you don't find this, we can either create it. But as we can see that it is here in 1,300 field, so prepayments is fine. But if you still want to keep different prepayments in different ledgers, you can still create some more. And now let's write the amount. If you are unable to write the amount, you can put any number here and the unit price here as well, and then you can enter the amount. And since this is a direct payment, as you can see here, that it is spent as a direct payment, or you can change it to prepayment. Select the prepayment from here and just save here. Now, after successfully entering the transactions, what we can do is just make sure that you have made the correct entry in form of debit and credit form because at the end of the day, the most important thing in all the accounting entries is the debit entry effect. So the advanced rent paid for six months should be charged as a prepayment should be debit. Means debit should be the prepaid ledger or advanced rent, whatever you want to say. This is recorded as an asset. So debit is asset of advanced rent. It is cash because we have faked cash already for the six months. So this should be the entry, and we need to reconcile this. So in order to check this, just go to the accounting tab and click on reports here. And right here, if you find it difficult to see the report, you can either use the find option. And in my case, I know the area. So go to taxes and Balances and just use the journal report for it. Also, you can just market as favorite so you don't have to find it or scroll it all the way down. Click on the journal report here. And let's put the desired dates. So for example, I want to extract the report from first of January until this date or let's say until December. So just set the date to December. Click on Update, and you will find the latest transactions up in here where you can see that prepayment is debit and cash in hand, it's credit. So sometimes it shows the debit down and credit ups, so don't worry about that. This is the perfect general entry, and this is how it's done. So just enter it by yourself, and then we will move to the next transaction. 20. Dealing With Security Deposit in Xero: Now, our next transaction is of January 2024, and it says security deposit paid by cash for shop taken on rent. Now, we have already given the advance for shop taken on rent, but we also need to give a security deposit that we need to pay in cash for shop taken on rent, and it is exactly the same amount. So what we can do is First of all, we need to create a new account in the accounting tab. I'll just go to the chart of accounts right here. And under the assets, I've already created the account. That's why I'm going to show you from here. Otherwise, we could have entered it from transaction directly as well. So I've created this account. Let me just delete it from here. That obviously means that you can add it from here as well. So let me just choose the desired area where I want to place that. So for example, I want to place this in the middle of these. So 13 30 would be fine, I guess. So 13 30, just remember this code. To enter this transaction, just use the spend money option, as we've seen earlier as well for this. Now, just remember, guys, you might think that you can use manual journal for that, but manual journals are only used when the transaction is non cash and non trading. Here, it is although a non trading transaction, it's not directly connected to our main course of business. But it is not non cash. It involves cash here. So that's why we will choose spend money option for that because even if you use the Manual journal entry, you won't be able to add the cash transactions in here. Let me just show you. Let's say, click on Manual Journal, if you click on cash here, you cannot see any cash or bank account in the manual journal entes. That's because zero discourages entry of Manual journals when you are entering the cash based transactions. So let's go to this plus sign right here and click on spend money here. Just choose the cash account. Click Next. And you can also create a new account like cash transactions as just a new contact. Just place the date here, any reference if you like. And since we are not spending the money to buy any item, we will leave this field as blank, and we will just copy and paste the description from here, copy it from here, paste it here, and the quantity, no quantity is there. We are paying for the security deposit, right? So we don't have the security deposit account. Just click on add the new account. And under the account type, I'll choose this current asset right here and just choose the code as 13 30 right here, security deposit. Paste it right here as well, and click on SV. Now let me put the amount as well here. We need to write anything here, let's say, like this one, although it won't affect any particular item because we haven't mentioned any, so click on Save. Now, after all such kind of payments, we need to make sure that we have made it correctly. I think I need to correct the dates here. So if you want to correct it, just edit the transactions. I just directly clicked on that entry view entry, and it took us to this option, and just make this correction where I want to change it to fourth and let's click on Update. Now, again, the most important thing is to check the journal entry effect of it. So I'll just simply go to the accounting tab and click on reports here. And from the reports, we can check the journal journal. Now the entry should be security deposit as debit and cash credit. So let's change the date to first of January up till this date. And as we can see the security deposit is debit and cash is credit. So this is perfectly fine. This is how you can enter the security deposit paid by cash for drop econ rent in zero. So just try it by yourself, and I will see you in the next one. 21. Handling Expenses of Paint and Renovation: All right, guys, now that we have entered a couple of transactions, the next transaction is of six Gen V Wiss, paint and renovation expenses of shop taken on rent. So for example, we have taken this shop, but it still needs some repairs or renovation expenses, which is approximately $1,500. So let's enter this. Now, it's not mentioned whether it's paid by cash or not, but in all the cases where it's completely not mentioned how it is paid, we will consider it is paid in cash because otherwise, if it was paid from a particular bank, it would have mentioned that. So it's obviously considered that it is paid by cash. Alright, now, here we have two choices. Either we can do the manual journal entry or we can use the spend function spend money function here. So if you are on the dashboard, just click on this plus sign right here and click on spend Money. And here we will pay it by cash, and it will open this spend money option. Now, f two, we have mentioned this cash transaction or journal purchase, whatever. So all you have to do is just enter the date on which the expense was made. In this case, it's sixth of January 2024. So I have chosen sixth of January. You can put any reference number depending on your company requirements. So I have, let's say, EXP double 05. Say. Now here, since we are not spending money to purchase any particular items, so we will keep this field as blank, and we will directly hit the account where the paint and renovation expenses should paid. So let's copy and paste this description right here and paste it right here, press a tab and we can put literally any quantity we want. All you have to do is just make sure the total amount is correct. So the total should be 1,500, and it will automatically multiply it by one, which is the total amount of 1,500. No. Here, what we will do is we will search for the expenses category to see the relevant section where we can put these expenses. So, for example, any kind of repairs, we can also put it in miscellaneous if you want. So for example, in this case, we will put it to miscellaneous expenses, but later on, we will change it to repair and maintenance. First, let's put it in the miscellaneous, and then I'll show you how to change the name of the chart of accounts. Let's click on Save, and we are considering that there is no tax in this transaction. So let's click Save. And as we can see the transaction is safe now, if we want to review that transaction, we can just click on review the transaction from here, and we also have the option here, and it will bring us the original transaction where we can go to the options and edit transaction if we want to. Now, let's see the report because we want to see how is the journal entry effect at the back end. It should be paint and renovation expenses as an expense debit and cash should be credit. But before that, I want to change the name of the chart of account, right. So I'll just go to this accounting tab and click on this chart of accounts. From here, just go to the expenses category where your expense lies. And let's say this one was the ledger, and this was the ledger, which is miscellaneous. And as we can see, there is 1,500 amount there as well. So let's click on that name, and now let's change it. We can also simply copy and paste that paint and renovation expense. Just change the name. You can paste the same in the description and click on Safe. All right. Now let's take the report. I'll just go to the accounting tab and click on reports. And now, if we click on general Report, we have already marked it as favorite. So that's why it's showing it on the top. Now, all we have to do is just adjust the date. Let's adjust to first of January 2024 and click on update. So up till today, it will show the transactions. So as we can see on the top, we can see the latest transaction which is speech and renovation expenses 1,500 as debit and cash in hand is credit. So it's up to you if you want to use the spend money function or the manual journal dry function. You have the choice of both. But what I recommend is just use the spend money option because it will show you the more accurate and proper way of doing things. So just try by yourself, and I'll see you in the next one. 22. Handling Customer Receipts: Alright, guys, our next transaction is of seven January, and it says Mr. Victor paid all previous balance by giving cash. So Mr. Victor is our customer, and when we see and scroll above, we can see in the customer details, we have the 65,000 balance against that customer when we imported all the balances and zero cloud accounting. So he's being very generous. He is clearing all of the money right away. So how will we receive this money against the pending balance? Let's see. So all you have to do is just from the main area. Just click on this contact right here and click on all contacts. Here, you will see the individual balances for all the customers. So we have this Victor here as well. So if you select Victor, so we can see the balance of Vctor here, right? So if you click on this balance, it shows this awaiting payment status. So if we double click on it, it's going to open that particular invoice. Now here we can simply just click on Ad payment and enter the amount which is paid by this customer. So he has paid us 65,000 all of the money, and it was paid on seventh of January. So let's make it seventh, and we have received the money in cash. So let's choose cash. And let's say case 001, whatever the references, whatever your company preference, and click on add here. And after that, you can see this here. Payment received 65,000 from Victor and paid on this date. So if you want to view that invoice or send the receipt, you can do that as well in zero. So after that, if you want to confirm it in the journal entry effect and also in the customer balances, how we can do this, go to the contacts here and click on all contacts, and now it should not show you any balance against the Victor. As you can see here, there is nothing here. And now if you want to check the reports as well, just go to the accounting tab and click on reports, and let's click on Journal Report. We just need to put January here and uptil the current date and click on Update to see the journal entry effect of it. And as you can see, the account receivable is now reduced because we've received the payment against this customer. So 65,000 is credit and cash in hand is debit. Perfect. Just try this by yourself, and then we will move to the next transaction. 23. Entering Item Purchase Invoices in XERO: Transaction is of eight of January, and it says purchase falling items from Mr. Daniel. And these are the items that we are purchasing from Mr. Daniel, and it's not mentioned here whether we are paying any amount. So when any purchase is mentioned against a vendor name, that obviously means that we are buying on credit because most of the business, almost 95% of the business in the world are on credit basis. So we buy now and pay it later. So let's see how we can enter the purchase invoices and particularly item based invoices, which is the main course of business we are buying and selling the car parts, right? So let's see how we can enter this. I can go to any particular area I want, and I will just click on dashboard here just to show you from the scratch. Now to enter the bill in zero, if you can see on the dashboard, we have the new bill option right here. But if you don't have that, you can go to the plus sign right here and click on Bill, or otherwise, you can just go to the business here, and there's nothing like bills here, so you have to click on Bills to pay first. And then from the inside, you have this new bill option right here, which you can use to create a bill. So I need to select the supplier here. So since we're already following a particular assignment or project, we have already entered some of the details as we can see here that Daniel was the vendor when we opened the balances in zero. So we already have this vendor. So all we have to do is just select here and just write here, and it will show up this vendor option. So just select that. And let's put the date. The date is eight of January. So let's change this one to January and just double click on the January and let's select the date. Now, the due date is set to some days after. Let's put the reference number p001, let's say. Now the items we are purchasing, we have purchased Carla windscreen. So just start writing these items and it will show up. The description and quantity you can just now enter, it's already showing a unit price because we have entered the opening balance against these inventories. So 20 is the quantity. Rate is 400 and the account will be inventory asset. So this makes up the total to 8,000. Just make sure to confirm the total before moving to the next item. The next item is civic headlights. Just quickly write civic headlights here, and the quantity is 30. Rate is 150, which makes the rule 240500. Now prius el cups. Let's write Prius here, quantity is 50, and rate is also 50. So let's put 50 here. Just confirm the unit price before entering or going to the next transaction because the rates might change during the period of time. Now, next one is Prius filters. So let's select that. Now, this one is a new item, I believe. Let's write filters here as well. So there's nothing like that. So we can directly configure it from here. Even if we remove from here, it will show you the complete list. And as we can see here, we don't have this item right here. So click on New item, and we are following the code IT 001, I 002. So we have completed or configured four items. So the next one should be IT 005. The item name is Prius filters, and I purchase this item, the unit price is 50. Purchases account will be cost of goods sold, and I sell this item also. The sales account is sales, the unit price, I haven't decided it yet, and I also want to track this inventory item. So whenever I purchase and keep it in my records, at that time, it will be in inventory asset. And also, you can see that when I click on, I track this item, it automatically disables the other two options. So it will automatically calculate the rest of these requirements. All you have to do is just select whether you're paying the text or not. So I have text exam items, so click on Save cost of goods sold account. Okay, I have chosen that as well. And now we can see the configuration, we have made the same configuration as before for all the items. So let's put 70 here. The rate is 50. So this makes the total 230500. So the total guys is 84,500, 2000 503,500. Just make sure to confirm each single amount before entering the transaction. And once it is done, let's click on Approve. If you want to add another, you can just click on this drop down and click on approve and add another. Otherwise, just click on Approve. Now, this will show you the approved bill. So if you want to take the print of it or you want to, you know, make any changes, this is the final entry. So once it is paid, we also have this option to scroll right here and just enter the payment amount, and we can play it from here. So now, before continuing to the next transaction, we want to confirm according to the journal entry effect, it should be inventory asset debit because whenever we have purchased the inventory items, inventory is debit and this person name should be credit because this is payable. So inventory to payable should be the entry. Because we haven't yet sold any items, we just purchased it and kept it as inventory. So let's check. I'll just go to the accounting tab and click on the reports right here. And if I click on Journal Report, I'll set my time period to January and first of January. Let's click on Update, and it should show it like this. As we can see that it's showing inventory asset for each individual items. This makes the roll the total amount. But since the items are different, so it's showing the account entry for each single item, but the item entry is inventory asset debit and accounts payable is credit. Perfect. This is how you can enter the purchase invoices or the item purchase invoices in zero. So just try this by yourself, complete all of this, and I want you to extract the report as well before moving to the next transaction. 24. Entering Inventory Purchase Invoices against New Vendor in XERO: Now the next transaction is of ninth of January, and this is purchase of the following items from Mr. Matthew. Now again, this is a credit invoice against the vendor, and it should be done in exactly the same way. The only changes is we have a new vendor introduced in our company. So let's see how we can enter this. And, guys, before moving forward, whenever the new vendor is entered, just make sure to confirm the rates because the rats from the new vendor might be different. So you need to keep that in mind. Alright, now let's continue the entry. If you are in this area, all we have to do is just click on this plus right here, and it's very convenient to use this plus option. This is the shortcut to enter all of the transactions in zero. It's pretty convenient. Let's click on Bill here, and let's copy and paste the name of Mr. Matthew. Whatever is remaining, you can manually enter that. Mr. Matthew, let's click on New contact. And as you will notice that it doesn't ask you any further configuration, that's a quicker way of entering the vendors. So if you want to edit some details of the contact, you can just manually go later on and add all of the further details about that vendor. But just to add the vendor quickly, it does this. So now the vendor is entered as we can see if we even remove this. All right, it's not actually entered. Now we will just copy and piece that right here, Mr. Matthew, and click on new contact. And as we can see that it's showing it as a new vendor. So when we continue the transaction, actually enter this bill, only then this vendor will be saved as a vendor. So if you want to enter some more details at this point, you have to do it via contact and then get back to this area. But if you want to just continue the bill and you can just later on add further details about the vendor, you can do that as well. So let's continue the transaction. It's of ninth January. So let's click ninth here and actually just double click on January. So let's say PI 002 is the reference, whatever. Corola windscreen. First item. Just make sure to confirm the ads. 50 is the quantity, and rate is the same. Next one, we have civic headlights. So let's choose the civic headlights right here. And the quantity is 30 and rate is 150. 30. And if you notice, guys, it's also showing the quantity on hand at each point. How cool is that? So 150 is the unit price, which makes the total to 4,520,000. So this is exactly like this. And let's move to the next one, which is preeus filters. And here we have the quantity of 100 and purchasing the rate at 50. So let's purchase it 100. Already, we have 70 on hand. So this makes it to 20,040 505,000. Unfortunately, we can't see the total here in this assignment, so we can see it right here. But since we have confirmed the individual amounts, that should not be a problem. And click on approve and click on approve right here. So now it will show you this final invoice. And if you want to just confirm it from the entries, just go to the accounting and reports. And click on Journal Report. Now, just guys make it a habit to check the report every time. That way, you will always be sure about the journal entry effect at the background. And this is the core requirement of any accounting soffit that it should do accurate journal entry treatment in the background. As we can see inventory is tab it, and credit is it is against Mr. Matthew. So if you click on contacts in all contexts now, Mr. Matthew will be added as a new in. So as we can see here, which is the balance is this. So it's showing it in red because right now I'm in currently the month of November, and this assignment is starting from January. So that's why this is a lot of time passed according to the current clock. So that's why it's showing like that. So, guys, this is how we can enter the purchase invoices directly by creating a new vendor. Just write by yourself, and I'll see you in the next one. 25. Handling Cash Sales In XERO: Now let's see how we can deal with the cash sales of the inventory items in zero. It's pretty simple and straightforward. It's even simpler if we compare it to any other accounting software. So let's see the transaction is of 11 January. We are in zero. Just click on the dashboard here. What you can do is just click on this plus sign right here and click on receive money. Now we are receiving money by cash, so we will choose cash here. Click on next, and we are receiving it as a direct payment. So let's enter it to cash transaction, or otherwise, if you want to separately mention it for the case seals, we can consider creating a separate contact as well. The transaction deed is of 11 January, so let's change it to January 11. Reference number is, let's say case sales CS 001. I'll change it to this one. Now let's enter the item. It was Carola windscreen, and we are selling one item in cash sales. The unit price for this is $560. So this one is the amount, and we are considering no tax in this scenario. So let's click on Safe, and that's all we have to do. As you can see, it's directly showing you importing a bank statement option or the cash sales option right here. That means it has already at the same time when we sold the inventory, we have received the cash as well. To make sure all the entry is correct, just go to the accounting dab and click on reports and let's click on Journal Report. Here we just have to change it to Genu and click on Update. And as we can see the inventory is credit and cost of goods sold is debit. And as we can see that it has made two entries against ID number 67 cash sales, cash is received 560 against the sales of 560, but the cost should also be charged against that particular inventory item. So 400 was charged as cost of goods sold. 500 was the total sale, 560 against which 400 was a cost, and it also reduced it from the inventory. This is the perfect entry, if we consider any accounting software, which is cash debit and sales credit, and at the same time, cost of goods sold should be debit in inventory as it should be credit reduced from that amount. So this is how you do it. Just practice this by yourself and check the report if everything is showing properly, and then we will move to the next transaction. 26. Entering Credit Sales in XERO: So far we have done all the transactions up til this point which she is on 11 Genu cash sales of Carla windscreen. So we have already done that. Now let's move to the nex transaction, which is of 12th of January, and it says credit sales to Mr. Walter, who is Mr. Walter. Mr. Walter might be a new customer, and we are selling him on credit for previous are Lights. That is the quantity we are selling, and the rate is 280. So let's see how we can enter. The best way to enter any sales invoice in zero is simply just go to this plus sign right here and click on invoice. And here we will just write Walter here. And since Walter is already our customer, as we can see on the starting point, in the customer details, we have an opening balance of water as well. So we are selling to Mr. Walter Prius real lights. So we have entered Walter. Now, 12th January is the date. So let's select 12th here. Invoice number, let's select any invoice number. Let's keep it to default because we haven't mentioned any invoice number in the assignment. So reference number, you can mention any reference number here or you can keep it as blank. Currency, we will select US dollars amounts are no text since we are considering no text in this particular project. And let's do the items now. We are selling preous ar lights. Ten is the quantity. And as we already know that when we created that items, we didn't know the sales price. That's why it's not suggesting it automatically. So let's type it manually, which is 280. And that's all we have to do. And that's all. Let's click on Approve. So approve is the final step because if we click on save only, it would have been waiting for approval. So at that point, it doesn't affect the accounts, so that's why approve is better. Now, when we want to see the journal entry effect of it, there will be four entries receivable to sales and cost of goods sold to inventory, as we have seen earlier as well. So let's check. Go to accounting reports. And from here, let's click on Journal Report. And just simply change the date or month to the starting of the year and click on Update. And as we can see the latest entry is shown right here. Now we can see that the entry is not shown right here, so we have to manually check that actually. So let's go to the customers, and under Walter, this is awaiting payment. Now, the issue date of this is set to first of December. So that is wrong. That's why we need to change this. We will just simply click on this invoice and we will click on the Sree dots right here and click on Edit. And from here, just quickly change the date. Let's pick the date. Make it January. And it was of 12th of January, right. So make sure you select 12 January here and click on Update, and now it should show in the reports. So let's click on accounting and reports again. And let's go to the journal report, and let's set it to January until the current date. So click on Update, and now we can see the water entry, receivables, debit, sales credit, and at the same time, cost of goods sold is debit and inventory is credit. So that is how you entered the credit sales in zero. Just write by yourself, and I'll see you in the next one. 27. Dealing With Customer Advances in XERO: Right. Our next transaction is of 13 January, and it says, receive cash in advance from Albert. Now, who is Albert Albert is our customer? Now, why the customer will be paying anything in advance? That might be the case where the customer is ordering us something, and against that order, we want to take some advance. We have some terms and conditions that only we will fulfill this customized order if the customer pays us in advance. So that's why he is paying us $5,000. And on the very next transaction, you can also see that we have received a sales order from the same customer of these items, approximately of $10,000 something, and he's paying us, let's say, 50% cash in advance. Now, what do you believe should be the treatment of customer advances? Isn't an asset or a liability? Now, because we have received the advance from customer, but we haven't provided anything yet. So in future, either we have to provide them with the inventory, fulfill their order, or you have to return the money back. So in either case, whatever you receive from the customers in advance, without any services, without any inventory supply, should be treated as a Now, in this case, you have received the cash advance from customer, and against that, you haven't provided anything yet. At this stage, this is treated as a liability. So debit will be cash, but credit will be customer advances as a liability account. Let's see how we can deal all of this transaction in zero with proper accounting treatment. Now, it's your choice if you want to go it from the desktop or you can find this plus sign anywhere in zero. That's the most convenient area. Let's click on Create New and click on receive money. Now, we are receiving the cash, so we'll choose cash in hand here, click next. And from here, this is the most important area how you are receiving this payment. We are receiving the direct payment prepayment or an overpayment. Since we are receiving this as a prepayment by the customer, so we will choose prepayment here. And what's the customer name? Customer name is Albert. So let's choose Albert here. Let's choose the date, which is 13th of January. An invoice number is this, you can put any reference number, and here we can put the entire description. Just copy and paste it from here, and we don't have to choose any quantity or something. We can just choose directly the account here. Actually, we have to select some quantity because otherwise it will not show us the total. So we will choose 5,000 here, and the total amount is 5,000 now. This is against our customer liability and not the sales because we haven't sold anything yet, we just received the customer advances. So let's see and scroll down whether we have anything in the liability section. So let's check we have gift card liability, accrued expenses. It's your choice if you want to change the existing name and use that ledger. But otherwise, we can create a new one. Let's say that I want something in the middle of it. So 2060 is the gift card liability. Let's say 2070 is free, so we will use that. Add account, we will use the account type as the current liability. So let's choose the current liability here and 2070 is our ledger. So as you can see, it's available. And let's write customer advances here. Just copy and paste this and paste it in the description as well. Text is exempted, as we can see in all of our project and click on Save. Now, this is the complete transaction. Let's click on Save. And when it is saved, you can just view the transaction again. Like any other transaction when we save it, you see this prom. Now, let's see the journal entry effect of it. I'll just simply go to this accounting tab and click on Reports here. Click on Journal Report. And let's quickly set our period from first of January to the current date. Let's click on update to see the transaction. Now we can see the proper treatment has been done. The prepayment is allotted to Albert, but cash is received as a debit and customer advances is treated as credit as a liability. Now, in future, when we enter the further entries of this customer, it should automatically recommend us to settle down the advances and create the invoice for the rest of the amount. Obviously you have already received 5,000, right? And the total invoice amount was, let's say 10,000. So we have already received 5,000, it should automatically recommend that, but that one we will see later on. Right now, I want you to practice this transaction by yourself and complete it until this point, and then we will move to the next transaction. 28. Entering Sales Order in XERO: All right, guys, now our next transaction is of 13 January, and it says receives sales order from Mr. Albert. And as we have seen in the previous transaction, we have already received some advance against that order as well. So if you haven't done that treatment, I want you to just enter that transaction and then move to this next section. So here we are receiving the sales order from Albert against order number 25, and these are the items that the customer has ordered. Let's quickly see how we can do this in zero. Now to enter the sales order in zero, there is no direct treatment of a sales order. As we can see if we click on this plus sign, we don't see anything related to sales order. So we have to use the quotation as a workaround to pass the sales order. Because in both sales order and quotation, accounts are not affected, so there is no financial implication of that. So we can use this quotation as a workaround. We will select the contact here. Just make sure that you are in the sales overview and quotes just to confirm that it is under the sales tab. Now let's write the name here, which is Albert. Date is of 13 January, so let's quickly put the date 13th of January. Expiry date is automatically selected. You can also configure that in the back end. So quotation number, I'll keep it as it is, or you can just change the quote number to a sales order number. So 25, let's say. And now just simply start entering the items. So the first item is Cara windscreen. Let's put here. Quantity is 12, rate is 560. So quantity is 12, read is 560. This makes the total 26720, and it is under sales text is exempt, no discount and press tab to move one line down. Next one we have is civic headlights. So civic headlights. Quantity is ten, rate is 210. This makes the total 220100, press tab, go on the next line. And the last one we have is pre use filters. So previous filters. Quantity is five, rate is 70, and this makes the total 2350. Now, guys, it will be more convenient if you take the print out of this document and then just follow the assignment instead of falling it from the perf. So this makes the rule 26720, 2010350. Just confirm it once before entering it finally. So all okay. You can put any terms and conditions here. You can attach the physical order files as well. If you want to delete any line, you have the recycle bin here. Also, you can just hold it from here and move any item up or down. And once we have completed this transaction, you can just save close out of here. And this is how you use the sales quotation as a work around for the sales order. Now here, when we saved it, as you can see, it's saved as a draft and not as a sent document. So we will just open this again and let's click on Send. You can just directly send it from here or you can click on Mark as sent. So that way, it will be moved from the draft documents. So now if you click on the Business and sales overview, it's showing this right here and it is under the sent now, and you can see it has moved from draft to sent. So this is how you can enter the sales order, practice this by yourself, and I'll see you in the next one. 29. Entering Sales Invoices in XERO: Our next transaction is of 14th of January, and this one says sales made of falling items to Mr. Justin. Now, as it clearly mentions that this is a direct sales invoice, because it's not mentioned here that it is against any order or quotation, it says sales made of the falling items. So that means it is a direct sales invoice. Let's see how we can enter this in zero. So from any area, just click on this plus sign right here and click on invoice. Also, you can just go to the Business tab and click on invoices from here as well. But since this is most handy, so we will use this one and just make sure that it is under the sales overview. Here we will just enter the name, which is Mr. Justin. Date is 14th of January. So let's make it 14th of January. And the invoice number, we can put any invoice number because it's not mentioned in our project, and you can put any reference number for your details. And now let's quickly enter the items. Carla windscreen five and 560 is the rate. Carla windscreen, five and 560 is the rate. Text exempted. Let's click on the next line. And the next one we have is Civic headlights. Now, guys, just make sure that you enter the right area. If you have to use this highlighter option, you can use that as well. But just make sure that you don't enter accidentally of another item. So we are in this area right here. So Civic headlights is ten and 210, which makes it rule 220100. Now, guys, you might have noticed that there was some mistake with the figures which I've already corrected, but don't worry you have downloaded the updated projects, so that might not be the case in your PDF file. Let's continue. Next one we have previous filters, four and 70, four, 70. This makes the Rule 2280. Just make sure before entry, everything looks fine. And if everything looks good, just click on Approve. And now you can just directly go to accounting to make sure everything is good. According to the journal entry, just go to the accounting tab and reports and click on Journal Entry report. Let me just quickly update the dates. And as we can see, this is the latest entry. Now, because this involves a couple of lines, for every line, it has posted a separate inventory asset as credit and cost of goods sold as debit. So account receivable is debit and sales is credit for each individual items, and at the same time, cost of goods sold is debit and credit is inventory for each single item. So don't worry about all of these entries. The common entry, if you combine all of this cost of goods sold and sales together, it will be just four lines of entries, which involves this complete transaction. So just practice this by yourself and make sure you have everything showing properly here, and then we will move to the xtradection. 30. Dealing With Purchase Order in XERO: Next transaction is of 17 January, and it says raised purchase order to Mr. Sean. Now, who is Mr. Sian or Mr. Sean? He's our vendor, and we have given the order to our supplier to supply us these goods. So this is a purchase order how we can enter this in zero. Let's. From any area, if we click on this plus sign right here, we can see that the purchase order specific area is here, unlike this sales order area where you have to find a work around. In purchase order, you don't have to do that because it's directly there. So just click on this and make sure you are in the purchases section and purchase orders. So let's enter the contact name, Mr. Sian. And the date of transaction is 17th of January. So let's quickly put that. So I've put 17 January. You can put any delivery date if you want to enter that. Let's say I want it to be delivered by 31st of January. So purchase order number is 55, but you can change it to the given one that is 49. So let's write here 49. You can write any reference here, and after that, you can just start entering the items. So the first item is Cerula windscreen. Now, the quantity is 25 and rate is 400. So this makes the Rule 210000, and the inventory asset is the default account selected here. Next one we have is civic headlights civic headlights. Quantity is 30 and rate is 150, 31 50. This makes the Rule 240500. Let's press Tab to move to the next line. And now we have the prius al cups. So let's read prius here, preus Val cups. Quantity is 20 and rate is 50. So this one makes the total to 15,500 just individually confirm each amount before finally entering this. And once you're happy, if you want to make some more adjustments like delivery address, something to write in the delivery instructions and telephone number, et cetera, you can do that, and after that, you can just click on a proof and save. But if you want to save a draft, you can use this specific area on the left hand side which says save, so that way, it will be saved as a draft. So if you click on purchase overview now, the top, you can see the purchase orders are shown not in the draft, not in the awaiting approval, but approved. This is the final stage of purchase order. So this is how you can just directly do this. So, guys, this is how you can enter the purchase orders in zero, try this by yourself, and then we will move to the next transaction. 31. Handling Bad Debts in XERO: Right. Our next transaction is of 17th of January, and it says Mr. Walter didn't pay the due amount thus treated as bad debts, and the total balance which we are going to record as bad debts is 17,800. Now why is 17,800? Let's scroll up to identify the transactions. As we can see on 12th of January, we have the credit sales made to Mr. Walter of approximately 2,800. And also, if we scroll up a little bit, can also see that Mr. Walter also has the 15,000 as an opening balance of the customer balances. So 15,000 plus 2,800 makes the total to 17,800, but he's unable to pay, and because of that, we will bear this expense, and it will be treated as bad debts. Now, what is the treatment of bad debts in zero? Let's see. Now, in zero to treat the bad debts, we only have one option, and that is passing a credit note. But first of all, we will just configure the bad debts ledger. So all you have to do is just go to the accounting tab and click on the chart of accounts. From here, just go to the expenses section and just observe if we already have the bad debt account. You can also search it right here if we have a lot of ledgers, you can just write bad and click on search. We already have this bad debt account right here, so 6,900 is the account where we will pass this credit note. Let's click on this business tab right here and just click on the sales overview where we will see all the options and we will select new here. And select credit note. From here, just write Walter and let's put the date and the date of the transaction is 17th of January. So let's do this 17th of January. Let's quickly change the date like this and 17th of January. Credit note, we will keep it as it is. Reference will be optional. So it only says didn't paid the due amount thus treated as bad dates. That means it doesn't involve any kind of inventory here. So we'll just simply copy and paste this description right here. This and just don't put anything in the quantity and in the account, we will put the bad debts. So just open this and search for bad debts. We can also try typing here so that we can easily find it instead of manually finding it. It finds the account by each letter and word or even number. So that's a quick feature. Now here, since you cannot enter the amount directly, so you have to choose some quantity and unit price, but don't worry will not affect any quantity. That's because we haven't selected any item. So the unit price will be the total amount that we are going to pass it as bad debts. So just post it here, and this makes the total amount to 17,800 and click on Approve. Now, the purpose of using the credit note is because of the bad debt since we are unable to receive these amounts from the customers, so the pending invoices should close in the accounting software, right? So we have two pending invoices. One was the opening balance. And one was the transaction during the year. So we want to close both of them. So 15,000 this, we want to close it altogether, and 2,800 is this. So remaining credit will be zero and click on allocate credit. Now, not only the bad entry will be passed, but also it will close the back end invoices. Now, once we have passed this entry, as you can see, the credit is allocated, let's quickly go to this contact and click on all contacts. And we can see here if we scroll down a little bit and check the water balance, there is nothing pending here. If we only click on that particular customer. We have zero invoices to O. We have this showing right here, invoices O to you is zero. So let's quickly check the report and just confirm whether or not it has passed accurate entry according to the journal entry in the back end, go to the accounting tab and click on reports. And from here, we will click on this journal report right here. Just quickly change the date. And click on Update. So as we can see, we have this latest entry right here, which is account receivable is credit and bad debts is debit, perfect entry. And also, it has settled down debit and credit in account receivable. So don't worry it is just an adjusting entry. Both of these are adjusting entry, as you can see that account receivable is hit at debit and credit and also account receivable, 15,015 thousand. So each one of the invoices is closed manually when we use the credit note option. This is perfect. We need to close it this way, and also it is charged against the bad debt. So this is perfect. Even if you want to check the income statement report, it should show it as the bad debt in the expenses, right? So just click on the reports here and let's click on the income statement or profitable loss. The time period is already set, you can minimize this and we can see the bad debt is showing in the operating expenses right here. And if you want to see the details of it, just click on here on the figure, and you will see the breakof it right here. So this is it. This is how we can treat the bad debts in zero. So just complete all of the transaction until this point, and then we will move to the next transaction. 32. Handling Purchase of Services: All right. Our next transaction is of 18 January, and it says packing charges, invoice received from Mr. Anthony. Now, what kind of packing charges is this, since we already know that we are buying and selling car parts. So this is very sensitive items, especially windscreens, headlights and all. So it involves special packing. So obviously, we don't have the packing unit because just trading business, we just buy and sell car parts, but we would encourage to buy the packing services from a professional so that it can avoid loss or breakage. So Mr. Anthony is very professional. So he is providing us this packing services. So this is a purchase of services. How will we deal this? Let's see. First of all, what we need to do is just go to the accounting tab and click on Chart of Accounts and just select the relevant area for that. Now we will choose the relevant area for that, and what you can do is just go and transfer it to cost of goods sold because anything which is directly incurred on the packing of products or any kind of direct cost on the items that you are planning to sell will be treated as direct cost. So I've already created the item of packing charges. As we can see here, let me just show you. I'll just scroll down under the five section and we have created this item after the cost of goods sold comes purchase discount, so I've chosen 5,200. So if you click on Add account from here, you will see this kind of screen. So let me just show you what I have entered. So I've entered account type as direct cost, and the code was 5,200 packing charges and description is also packing charges. So how and where will the packing charges show up? It will be shown in the cost of goods sold. So now, what I'll do is we will just create an item for that. So if you click on Bill and since this is our new vendor, I'll just write Mr. Anthony here. Click on New contact, and the date is 18th of January. Reference number, you can keep it blank or just fill in with any number. Now, in the item, we will create a new one, and let's say service 001, anything like that. And you can write here packing charges in the item name. Now, I purchase this item, and we will choose the packing so let's say unit price is, I'll just keep it this amount, 4,500. Description is already chosen. Now, I only purchase this kind of services. I don't sell them. I don't track this item because this is not a physical item, so that's why it shouldn't be used. Text exempt is the transaction. Let's click on safe, and we have already chosen this and now as we can see that the quantity is one, let's say, and unit price is this. Now, just remember guys that when you create this service item, you have to mention the unit price. Otherwise, it will not automatically show the account here. So now that we have entered all of this, let's click on approve. And now let's quickly go to the accounting tab and click on reports to see the journal entry back end effect because that is very important for us to have a correct accounting treatment in the form of journal entry at the back end. So let's click on Journal Report, and let's quickly change the date period. And click on Update. Now, as we can see here, that packing charges is debit and accounts payable is credit, perfect. And if you want to check the reports and income statement, we can go here as well. Just set the required period and you will see the packing charges showing in the cost of goods sold, which is perfect. So this is how you can deal with the purchase of services, especially which is related to the direct cost and zero. Just try this by yourself, and then we will move to the next transaction. 33. Payment For Purchase Of Services in XERO: Transaction is of 18 January, and it says paid Mr. Anthony by check off standard Chartered Bank. So we are paying for its services, and we are paying partially because the total invoice was for 4,500 and out of which we are paying 3,000. So let's see how we can do this in zero. Now, guys, it's very simple to do it in zero. All you have to do is just go to this contact right here and just search for the vendor. Select and just open that bill which is pending or awaiting payment. So click on that and just simply click and select amount paid from here. Just open that bill, and all you have to do is just mention the amount paid. Amount paid was 3,000, and the date on which it is paid is 18th of January. So let's put 18th of January. And pay it from just select the account, standard chartered bank right away. And you can put any reference number like PMT 001, that means payment made. And let's say pay it by check, you can take that as well and click on Add payment. So if you click on paycheck, it will ask you for the check number and some additional details like memo, et cetera. So you can fill in those details and click on Save. Now as we can see that it's showing in the awaiting payment, but let's just confirm it from the accounting tab and reports, whether it successfully entered that or not. Let's quickly update that. And as we can see, it is paid now. So if we go to contact now, it will be shown as paid. It might take some time to refresh that, so don't worry about that. Whenever you see some transaction is still shown there, you can just refresh that. It was Mr. Anthony, and you can see the pending balance is only 1,500 now. And if we click on here, we can see the details here that 3,000 is paid, and the rest of that is still awaiting payment. So that's how it is done. This is how you can pay for the purchase of services in zero. Just try it by yourself, and then we will move to the next transaction. 34. Converting Sales Order to Sales Invoice: This video, we will see how we can invert the sales order to sales invoice, as we can see in this particular project that we are falling on 19, January, it says, send all items to Mr. Albert against previous sales order. So if we scroll up, we have a sales order from Mr. Albert, but as we have seen earlier that zero doesn't allow to enter the sales order, so rather, we have used the sales quotation as an alternative for the sales order, and at the same time, we have also received an advance amount from Albert against this big order. So now what we want to do is just convert that sales order to sales invoice or sales quotation to a sales invoice and also settle that pending advance against the invoice so that we can only invoice the remaining amount and not the full amount. So let's see how we can do this in zero. So from zero, we will do the simple readmin and for that, just go to this business right here and click on quotes. And from the quotes, just make sure that you have this two cent and not in the draft. Already have this in the sent, but let's say that I select this encliconEcept, so that it's also showing as accepted only that way you can pass the invoice. So it is finalized quote now. So once it is finalized and shown in the accepted, you can just directly select that and create an invoice directly from here, or otherwise, what you can do is just open this particular quotation. From here on the top, you can see the create invoice option as well. So just use any of them. And once it is open, it shows you create invoice for sales order 25. Let's market as invoiced and click on Create. So what it will do is it will transfer it to the invoice interface, and then we can make the further adjustment of the customer advances. So as we can see, we are in the editing mode of the invoice, and we have all the information mentioned here. Only what we need to do is the issue date. I will automatically change it to the current date of the system. So we have to manually adjust that, just pick an other date. Let's quickly change this to 19th of January. So 19th of January, automatically, it will change the due date to 18 February. We can set these terms and conditions as a default. And the invoice number and reference number is set here. The only thing what you need to do now is adjust this credit. It says here, USD 5,000 credit is available. So the total invoice amount right now is $9,170, which is for this one, 6720 2,103 50. All good. Now, as you can see that direct, we don't have any option to adjust this credit available. So all we need to do is just click on this finalized stage and click on Approve here. Once we click on approve, it will ask you do you want to apply the credit to this invoice? Let's apply the credit here, and it will ask you that outstanding credit is 5,000. How much do you want to apply, and we want to apply the full amount? So the remaining due on invoice will be 4170 exactly how we want. Click on Apply. And as we can see, it's pretty convenient to adjust all of this in zero. So let's see the finalized entry, as you can see, now it is adjusted 9170 is the amount. 5,000 is adjusted and the remaining due amount is 4170. So click on this ad payment. So now at this stage, it is already saved. Just go to sales overview if you want to go back. And now let's take the double entry effect at the back end. What we'll do is just go to the accounting tab and click on Reports. And from the reports, let's click on Journal Report. Let's quickly adjust the time period and update. And as we can see here, we have a lengthy entry right here, but don't be scared. It's pretty simple. It says account receivable is debit and sales is credit. The simple entry, but it has done the separate entries for each inventory item. And at we have also received the customer advances. So before we entered the customer advances as a liability, so now the liability is reduced, so it is debit. Once the liability is reduced, it's debit, and against that, account receivable is credit because we have also received the advance. So this is the existing entry and the remaining entry is cost of goods sold to inventory. That's it. So this is the perfect entry for this. Now if we check the reports in the accounting tab, click on reports, and now if we check the let's say balance sheet, it will not show anything pending as a customer advances or liability. So the ending date is 31st of October 2024. Let's check the section of liabilities, and as we can see, there is nothing shown in the liability because it is fully received. So this is how we can convert the sales order to sales invoice and also at the same time adjust the customer advances in this. This is a very important topic that I want you to practice, and then we will move to the next transaction. 35. Dealing With Purchase Returns in XERO: Next entry is of 22nd of January, and it sees return ten Carla windscreens. To Mr. Matthew, that is purchase returns. That means we are returning these items because of some defect to our vendor. So this is a purchase return or a debit note. How we can enter this in zero? Let's see. Now to record the credit note or a purchase return in zero, all you have to do is just click on this business tab right here and click on Bills to pay. Here we'll show all the finalized bills or purchase invoices. As we can see all are awaiting payment. But as we can see here, return ten Carla windscreens to Mr. Matthew purchase returns. So we have purchased something earlier from Mr. Matthew against this invoice, I want to settle a credit note. So here if you want to just pass a generalized credit note and not allocate against any particular invoice, what you can do is just code this corner right here on the top and click on new credit note. Otherwise, if you want to allocate it to a particular invoice, then you have to decide what invoice it is. So in my case, this is Mr. Matthew. Let's select Mr. Matthew and it will open up that bill. Now what we will do is we will go to the bill Options and click on Add a credit note. What it will do is it will replicate the complete bill here. Now, whatever items you don't want to return, just delete those from here. So I'm returning ten Carla windscreens. So I'll just get rid off quickly of previous filters and civic headlights. I want to return only this and I want to return ten in quantity at the rate of 400 per unit. So that's fine. This makes the rule to 4,000. And the date I need to adjust is 22nd of January. So 22nd of January, I've changed the date, and now let's click on Approve. Now, it says here, totals didn't match because it didn't change the total here, so we have to manually change this four to 4,000, and let's click on Approve. And as we can see here, now the total invoice amount after the credit note is approved, Mr. Matthew is 29,500 out of which we have settled against the ten Garla windscreen that we have returned as a credit note, and the entry is 4,000. Now, if you want to check the journal entry effect, it's very simple. Just go to the accounting and reports. From here, just click on the Journal Report. Let's quickly change the date. Date range is changed, and now we can see that accounts payable is debit and inventory is credit because we have returned the inventory. When we purchase the inventory, inventory is increased as an asset, so it's debit. Now the asset is reduced, so it's credit, and against that, accounts payable. Since we have returned the inventory, we don't need to pay for that. Account payable is also reduced at this stage. And it has passed in other entry, which is just adjusting entry for the backend system. You don't need to worry about that, but this is the main entry. So this is how you can pass the simple entry of a purchase returns against the purchase invoice allocation in zero. So just try this by yourself, and then we will move to the next transaction. 36. Dealing With Sales Returns in Xero: Right, guys, our next transaction is of 24th of January and it says return five civic headlights by Mr. Albert. This is a sales return at the rate of 210 per unit. So we have sold earlier to Mr. Albert, I guess, so let's check the entry. And as we can see, we have just entered sent all items to Mr. Albert against previously issued sales order. So we've converted sales order to sales invoice before. But when our customer received that items, he found some defect or some quality that is not up to the mark which have some problem. So they want to return us this five civic headlights. This is sales return by the customer. So how will we deal with this in zero? Let's see. Now to enter the sales return, all we need to do is just go to the business tab right here and click on the invoices and just ooe the relevant invoice. Now, the invoice that I want to enter against was Mr. Albert. So as we can see, this is a draft. This is an extra invoice. So as you can see, there is no due amount, nothing here. But for this one, this is awaiting payment, and this is the one against which we have also settled the advances. So let's click on that. Here we will enter the credit note. Just click on the three dots at the corner. And from here, just choose this create and apply credit. It will replicate it in the same way as we have seen before for the purchase returns as we can see, this is the credit note entry now. So let's quickly change the date. The date was 24th of January, so 24th of January. We have changed the date and text exclusive. Since we are not considering the text requirements in this particular project, so all of them are text exclusive. Now let's quickly adjust this. Since the customer is only returning the civic headlights, so let's quickly get rid of this extra inventory items. Only we will keep the civic headlights and just delete all of the rest from this cross sign right here. Now, the customer is returning five civic headlights at the rate of 210. So 210. Now, why it was showing 95? So it might be showing at some cost or something like that. So you can manually change that. And the account is already set and we have the total amount here, and let's click on Approve here. Now, once we have done that, it will again transfer it to the complete invoices tab against which it will show you that this is the complete invoice. This was the initial invoice against which the total amount was this one. The prepayment was settled as this one, and at of 24th of January, this credit note is also settled. So the total pending amount that the customer needs to pay us is one. So it's already ended. When we click on sales overview, it doesn't show anything to save. That means it's already entered. Let's quickly check the accounting tab and click on reports for the report. Click on Journal Report. And now let's quickly change the date to first of January 2024 up until this date. So, guys, this is the entry as we can see here, this is the adjusting entry just for the system background. So don't just worry about that. Just check this one entry right here. When we make the sales on the credit, the default entry is receivable to sales wright. So when any return is made, it's obviously account receivable will be credited, the reversal of it, and sales will be debited to reverse the sales. Also at the same time, since we have received that inventory back that customer has returned to us, inventory is debit inventory is increased, and as of the result, cast of goods sold is credit because it is no longer a sold item. Guys, this is how we can deal with the sales return entry in zero, especially by directly applying and allocating it to the earlier invoices. If you don't want to allocate it to a particular invoice and just settle a credit note directly without setting it or adjusting it in any particular invoice, what you can do is just click on this Business tab right here and click on sales overview. From here, you can just click on New and create a credit note, which will not be linked to any particular invoice, so that's also the option that you can try. But you can try it in a separate company. Once we complete this assignment, you can just start a new company freshly to practice on different options of zero. So just do this entry until this point, and then we move to the next transaction. 37. Complete Settlement of Customer Account Balance in XERO: Ex transaction is of 25th of January, and it says Mr. Justin cleared all his previous balance by giving us cash. So Mr. Justin is our customer, and as we can see if we scroll up, we have made some sales to Mr. Justin. And also, when we created the company and transferred all of the balances in zero, Mr. Justin also had some opening balances, which is 85,000. So he has a lot of balance to pay, and he's being very kind. He's clearing all of his previous balance by giving us cash. How you can do this in zero, let's see. Let's see if you are on the main dashboard, all you have to do is just click on this Business tab right here and click on the invoices or Sales overview, whatever. You can click wherever you want, and from here, you can click on Awaiting payment. If you go to this invoices section, it's even better because it can take you directly to this area. From here, you have to locate this awaiting payment option right here. Just click here. And it will show you all the pending invoices. Now, in this case, Mr. Justin has two balances against two invoices. One was the opening balance, and one was the invoice during the year. So the customer is paying against all of the previous invoices. So what you can do in this case is you can just sort it by customer and select all of them. If you have multiple invoices, let's say, you can just select the first one, hold the shift key and select the last one. It will select all of the transactions. So here we will bring together all the customers. So select this one. Hold the shift free, select the last one. This is the method to select all of the invoices, and then we can select this deposit option right here. I'll also show you how to receive the single payment against any single invoice. Click on deposit, and it will take you to this new batch deposit area because this is against multiple invoices, we'll show you this batch option. So let's put the date, which is 25th of January. Enter any reference number, choose how you are receiving this money. We are receiving this in cash. So let's click on cash in hand and we are receiving the complete amount. You can mention the check references number here as well. And after that, you can just click on deposit. And it will clear both of these balances. If you go to the contacts and click on all contacts, Mr. Justin shouldn't show any balance now. So as we can see, Mr. Justin doesn't have any balance here. But just to make sure that we have done everything correctly, we have to check our back and journal entry. And for that, just go to this accounting tab and click on Reports. Click on Journal Report. Let's quickly set the period and click on update. Now, as you can see that we have received the payment in multiple transactions, but we have done it in the batch. So cash in hand is debit and account receivable is credit, it's fully settled. And for the other invoice as well, cash in hand and account receivable. So this is the correct treatment, guys. This is how you can receive or clear all the customer balances against the multiple invoices in zero. Just try this by yourself, complete it until this point, and then we will move to the next transaction. 38. Sending Inventory against Order in XERO: Our next transaction is of 26 January, and it says, Mr. San sent all items against previously issued purchase order. So if we scroll up, we have raised the purchase order to this supplier, and now this supplier is sending all the items to us, so we are receiving all the items against this purchase order number, let's quickly see how we can do this zero. In order to convert a purchase order to purchase invoice, it's pretty simple go to this business tab right here and click on purchase orders. And here is the pending purchase order which is approved. Make sure that the status is set to approve. Otherwise, if it is set to some other area, just select that or open that purchase order, and then you will find this approved option right here and just click on the approve. Now, after that, I can just directly select this and click on copy two a purchase invoice or we can do it from the inside. We can just open this purchase order. If you want to review it, let's and click on options and copy to the purchase invoice. It's that simple. So let's do it from the outside. If we see this area purchase overview, just scroll down until you see this approved area. Just go in here, select the purchase orders you want and just copy to a purchase invoice. Copy two. I want to create a bill here because invoice says, charge this purchase order to a customer. I don't want to do that. I want to create a purchase invoice. So in zero, purchase invoices means bill. It says turn this purchase order into a bills to pay. Mark this purchase order as fully billed. So create draft. What it will do is it will create a draft bill so that you can view it and finalize it. So we will open this, and as we can see, all of things are mentioned, we have to make sure everything looks good. Just change the date however we want. So 26 of January 2024, and the due date is automatically set purchase order reference is mentioned here, and just make sure we have the correct order amounts and total amounts showing we can see, the order number was 4910040500000 was the total amount, 10,040 500,000. So this makes the total 215500 all good. If you want to again save it as a draft or save and submit for approval, you have the option to do this. But the final stage in zero, if you want to directly approve that, just click on this green button right here directly, and this will convert the purchase order to a purchase invoice. Now, let's go back to this purchases overview section. Let's click here. As we can see now, no purchase orders are pending, and that's exactly what we want here. Now, since when purchase order is created, it doesn't affect the accounts, but when it is transferred to purchase invoice, it hits the financials. Now it should affect the accounts and when the account is affected, a general entry is created at the back end, let's see that. Let's go to the accounting tab and click on Reports. And here we will click on this journal report. So let's quickly set the period which is first of January onto the current date and click on update. And as we can see, Mr. Sian, inventory, as it is debit, because finally the vendor has sent all the items, so we have purchased all these items, so inventory is increased, and against which we have to pay this certain balance. So all looks good. This is how we can do this transaction where we convert the purchase order to purchase invoice in zero, complete these transactions, and then we will move to the next transaction. 39. Dealing With Loss of Inventory in XERO: Next transaction is of 27th of January and it sees one roula windscreen damaged during loading and unloading. Now it clearly says that this product is damaged because of mishandling, so that is our loss. That loss is caused because of our labor or mishandling during the process. So that's why it's damaged. Now, this is an indirect loss. In accounting, you have direct loss and indirect loss. Direct loss is applicable where let's say you are manufacturing an item, and in the manufacturing process, the loss is some kind of wastage is normal, so that's normal loss or direct loss. Otherwise, if it is not related to that, and it is caused by the mishanding or let's say, in this case, loading and unloading, this should be charged as an indirect expense in loss of inventory. So let's see how we can do this in zero. So first of all, guys, I have to create a new ledger for it. I'll just go to this accounting tab. Maybe the loss ledger is already created, but we need to check that. Go to the accounting tab and click on Chart of Accounts. Now, as I told you that this is the part of the expense, so we have to explore the expenses area and we need to check the right category for it. Now, I cannot see any particular ledger, which is related to this area. So after the other expenses or let's say, after the depreciation, I can put this on 7,200 code as a loss of inventories. So let's create the account. I'll just simply click on this ad account right here and just select the account type. I will select it as the expense. And the code I have decided is 7,200 so this one is available. Let's right here, loss of inventory. Just copy and paste the same in the description and text is exempt. Click on Save. And now let's enter the transaction. Now, it's very simple to pass a loss of inventory entry in zero. It's very convenient function. Just go to this business tap right here and click on the products and services at the bottom. After that, let's scroll down and select the item you want to adjust. So here, in this case, one Carla windscreen was damaged, so I'll just select this Carla windscreen right here, and on the right, you can see this three dots right here. Click on that, and here we have multiple options. We will select this adjustment because we want to make an adjustment. Now, it will ask you what type of adjustment do you want to make, and it will also show you the summary of this particular inventory item in the ledger. We have the quantity on hand, 537 quantity. Average cost is this, so this is the total value. So we want to decrease the quantity the date is 27th of January. So 27th, decrease quantity by you will put one here. Just make sure that it's showing 536 after that. A adjustment account, we have already decided the adjustment account. This is loss of inventory. Then you can put the reference here. In the reference, we can just write loss 07, whatever, like this. Click on next. And this is how you can post this, click on post the adjustment. And just to make sure that everything is good, we have to make sure that general entry effect is correct. So just quickly go to this accounting tab right here, click on Reports. And here, let's check the general report. Quickly select the period, first of January 2024. And click on Update. Now, as we can see the loss of inventory as an expense is debit and inventory asset is credit perfect. This entry not only records the journal entry correctly in the back end, but also reduce the quantity. That is exactly what we want here. So as we can see, this loss of inventory entry is very easy to do in zero. So just enter this transaction and then we will move to the next video. 40. Adjusting Expenses Against Prepayments: Now, our last transaction for this project is of 31st of January, and it says rent expenses for January, adjusted from Advanced rent account for an amount of $3,000. So if we scroll up on the starting of the assignment where we have implemented and started the day to day transactions, you can see on the very first we have this four January transaction, which says advanced rent paid for six months by cash. So we have paid already for six months in advance. But at that stage, the entry was recorded as a prepayment, which is an asset. So we have debited prepaid rent, 18,000 and credited cash as 18,000. Now that we have consumed the benefit of this complete month, the only portion of that particular month should be converted into expense from the prepayment. So although we have paid six months rent in advance, but according to the accounting standard, if you have not consumed the benefit yet, it is considered as a prepayment, prepaid rent. So now that we have consume the benefit until this point, rent expense should be debit as an expense of 3,000 and credit should be advanced rent as 3,000. Let's see how we can do this in zero. Now, since this transaction involves no cash, it is a non cash and non trading transaction. So whenever the transaction is non cash and non trading, it will be passed with journal entry. As we can see here, this transaction is non trading and non cash, how non trading? Because the rent expense is not the normal part of the business, although it supports the business, but it's not buying and selling of the car parts. It's not like that. So rent expense is an other kind of expense. It is non trading expense. And also, it is non cash because we have already pass the cash earlier. Now it is just treated as an adjustment entry from the advanced rent. So these kind of entries, which is non trading and non cash should be treated with the manual journal entries. What we can do is just click on this plus sign right here and click on the Manual Journal. Now, if you don't see this option, I've explained in all of my previous videos how we can enable this Manual journal option. So just click on this. You can simply copy and paste this narration here, this one, paste it right here. Let's put the date, which is 31st of January. Default narration to the journal line description, it will automatically transfer this particular narration to each line of the entry, so we will keep it as it is. Show journal on cash basis report. Let's keep it as it is. So we will debit the rent expense. We can see only one area for that. Let's explore. Now, it looks like that we don't have the rent expense area, so we will create this new one. I'll create this in 6180, let's say. So 6180, we will go to add a new account. Account type, we will choose it as expense. 6180, this code is available, and the name of the ledger is rent expense. Spy and paste in the description as well and quickly just save this. Now we have this account right here. The debit is 3,000, and the credit will be prepaid rent. So prepaid rent or prepayments. We have the prepayments right here. Prepayments will be credited 3,000. So this is the final entry. Let's click on post, and this is how it is done. If you want to view that again, you can just view it and it'll open the same area. Now, let's click on reports, although we don't need to check this manual journal entry because it is already in the journal entry form. But let's see, to make sure everything looks good overall, Click on Update and here we have it. Rent expense debit and prepayments is credit. And now let's make sure that we have used this prepayments option for the earlier entry as well. So let's click on accounting and click on the chart of accounts. Let's quickly go to this assets area and locate the prepayments. And as we can see that now it's showing 15,000. Total was 18,000 against which we have transferred this prepayment to reduce this with 3,000 because it is already made as an expense at the month end. So, guys, that's it. This is how we can make all of the entries we have completed project, and that's exactly how you implement the system in companies. Only the quantity will be more, but the process will be, exactly the same. So this is the most interactive way of learning the software. In the next videos, we will see how we can extract some different reports as a finalized report like trial balance, closing, profit loss and balance sheet, and we are good to go. So just complete all of these transactions so that we can finalize reports at the month end. 41. Conclusion of the Project: All right now that we have completed all of the transactions in this particular project, let's explore some of the reports in zero. And the first one we have is trial balance. So if you want to extract the trial balance, just click on this accounting tab right here, and all the reports can be found in this particular section, which is reports. And we have this custom trial balance here. We have made some adjustments and set it as custom. So let's click here. But let me just show you thing. Let's say if you can't find it right here, you can just scroll down and you will see this in this area, which is taxes and balances. Here you will find this trial balance and how you can put it upwards. You can just mark it as favorite so that it shows up here in the favorite section and you can do the same for all the frequently needed reports. So let's click on this trial balance right here, and this is off first of January. You can select a custom period you can select if you want to compare it with the last year, you can select the number of columns you want and how you want it. You can also change or reorder the columns in whatever sequence you want, you can just select and drag it over. And you can also select what columns do you want here. You can also summarize it by certain type, like groups and all. So this is the overall trial balance. As you can see, it's very clean and easy to understand trial balance. I must say that zero reports are quite simple to understand with a nice simple and compact interface. This is the trial balance. On the debit side, we have 4762 730. Now, guys, this might be different from yours. Maybe in the middle of assignments, we have made some mistakes, so you have to manually check them all the transactions. But this is just a project, so nothing to worry about. If you have different balances, you can check it manually to confirm all the balances, but these are the balances trial balance. On the debit, we have 4762 730, and credit is this one. These are the individual balances. If you want to see the detail of any particular balance, what you can do is just click on that particular balance. And it will take you through this individual ledger report. So once you want to go back, just click on the report from this corner area and you can get back here. So this is how we can extract the trial balance. Now if you want to export this report, what you can do is you have two options right here. One is export. You can either export it on PD Excel sheets on Google Sheets, or you can save it as published or custom. If you have made any particular changes, you can save it as custom. So let's export this as an Excel sheet right here, like on Excel. And as we can see download it has started, I need to exit from the full screen, and you can see here that this is the report. It's showing exactly like this. Nothing is merged. Nothing is, you know, messy. When we transfer it to Excel, that is amazing. And as we can see that it perfectly exported in Excel, nothing is messy, nothing is merged here. So it's very simple and you can easily apply formulas to it. Now the next report we want to see is accounting tabs, good Just go to the reports. And let's export the income statement. Now, by default, it might be already set in the income statement as a favorite, but if not, you can just scroll down, and we have a couple of reports here under this reconciliation. Under this financial statement section, you can find this income statement and profit loss report. So just click here and you can set the period. And this is the overall profit and loss. Unfortunately, we have made the loss in this particular month. So this is all the summary about it. So let's click on Export, and this time, let's see how it looks in the PDF format. As you can see, downloading has started, just go to this exit from this full screen and you can see this income statement like this. Now finally, let's export the balance sheet as well. Accounting tab. Just click on the reports here, and let's click on Balance sheet. So here is the balance sheet. You can just set the period how up until which point you want this, and I want this, let's say, till the end of the year, and the currency is US dollars, whatever you want to set. Compare if you want to see the comparison with the previous month, you can do that as well. But if you don't want to do this, just change it to none and click on Update. So as we can see, this is the finalized balance sheet this time, and we can export it as Excel sheet. So these are all the finalized report. What I'll do is I will attach all of these reports for you to match with the link of this video also if you want to check and extract the individual ledgers report, you can just click on this accounting tab, click on reports, and you can just go to the bottom until you see this area which is taxes and balances. And here, you can just select the journal ledger detailed report. I'll just select the period, and I want to select all the 74 accounts. Whatever they are, just set the period from first of January to this date. Let's say till the end of this particular year. And that's it. This is the complete ledger. So what I will do is, if you want to check individual balances and match up with my report here, I will export this, save it as an Excel sheet so that you can match your ledger with this. So let's export this. Now, guys, this report might take some time to export, so just relax until it does. So this is the general ledger detailed report. You can match all of those transactions from here, and I hope you have enjoyed this practical implementation of zero Cloud accounting software where we have learned all the functions of zero, by working on the live project, so, guys, I hope you have completed all of the transactions. And at this particular point, I want you to write a review about the course and overall experience of the training. Just escape this video from this full screen, and on the right, you can see this leave a rating option. Just click on that. Just mark your stars. Five means it was great experience. One means very poor. So I hope you really like the training, and I would really love to hear from you by reading your awesome reviews in the written forms. So at this point, I request you to write a review as well of your overall experience and then post it like this as I'm showing you right here. And, guys, this is not all. I will cover all the other functions in the frequently asked questions, which will be started immediately after the completion of this video. So you can check all of the other functions like sales tax, like bank reconciliation, all of them in the frequently asked questions. So after the completion of this video, just check that section out and I'll see you in there. 42. Creating Multiple Trial Accounts in XERO: All right guys, now that we have completed our assignment in zero Cloud accounting, now we will see and explore some of the other functions like VAT, bank reconciliation and all the essential functions in zero. So first of all, we will see in this video if you want to configure or re enable the trial account, how can we do that? Because as we all know, one particular email account, it allows you to use zero for a complete 30 days. After that, it will expire. So mostly, we do have a couple of email accounts. So how can we overcome this if you want to practice on zero for a longer period of time? For that, we will use the Temp mail. So just go to the Google and write TEM Mail. What it will do is it will create a temporary email with the support of which you can create the Zero Cloud accounting trial account. And as soon as it expires, you can create a new one simply by creating another email and signing up for it. So first of all, let's generate a temp email and let's see the further process. So just right here, temp mail. Just click on the first website. And here you will see this temporary email address loading. Now, guys, if you have already used some of the particular te email, what you can do is just refresh it from here if it is showing the existing email that you have already used. So in that case, you can just refresh, and it will change the email for you. So let's just copy this and let's go to Google now and just write here zero. It will show you this first website zero.com. Just click here, or you can just directly click on sign up for free trial. It says zero free trial for 30 days. Just click on this. And here, just mention your basic information. I'll just quickly mention that, and I'll mention this email address right here. You also have to mention the phone number. So let's quickly mention that. Let's select the region. Now, just click here. I've read and agreed the terms and conditions. If you want them to send the marketing communications, you can just click on that. Otherwise, just click on I'm not a robot, and it will take you to the next step with this next confirmation button. And as we can see that it says, Hi Sad, confirm your email and start using zero. We can quickly see and check this email confirmation as you can see, it has a personalized inbox right at the bottom. Just go in here and let's click on this. Yes, it's me. Let's get started and just select a simple password. And activate your account. So, guys, this is how you can activate our free trial on zero with this quick method. Now, guys, after activating this, what I want you to do is just copy this information somewhere so that whenever you want to login next time, you can just see the credentials from here. I'll write ser name here, paste it here, and the password. Whatever is your password, you can just mention it right here and just save it. So this is how you can activate as many free trials in zero for your practice as much as you want. So just activate this with me, and then we will see some amazing functions of zero. 43. Setting Up Company on New Trial: Right now, after activation of the free trial, we will quickly see how you can set up a new company. So I'll just keep the basics because this is what we have covered earlier as well. So I'll just mention it as XYZ company. And just choose any industry, whatever you want, just write here and choose your country. And the last day of financial year, do you have employees? If you want to enable the employees, you can click here. And what tools you currently use, just mention something like let's say we're maintaining the accounts on spreadsheets before. So let's click on Start a trial, and this is how you can activate the new company in trial account. And as you can see here, that you have new 30 days left for your trial. So this is the main interface, and when you load the interface, it will quickly give you a setup guide. If you want to disable that, just minimize it here and just close out of here, and you will see this desktop like this. If you are not on the desktop, just click on this dashboard right here and it will take you to this desktop. So I want you to set up this way and create and start a new company so that we can explore some functions. So just practice this by yourself, and I'll see you in the next. 44. How to Import Bank Statements in XERO Part 1: All right. In this video, we are going to explore that if you want to import all the bank transactions using a bank statement that you already have in the Excel format, how can we easily do this? So if you want to get all the banking transactions directly into your zero account, there are two methods that you can follow. Method one is using the bank feeds. This is an automatic feature that zero offers to just directly connect with your bank, and the transactions will automatically flow into your zero account without needing to import it manually. But what if your particular bank is not supported in zero bank feeds option? So in that case, you can take the help of just manually importing all the transactions using the Excel sheets because as we all know, all the banks offer to export the transactions or bank statement in the Excel format. So you can just directly use that Excel format to import all the bank statements directly in zero. Now the other scenario might be that the bank feed that you just enable and import all the transactions from the bank feed, it misses some transactions, so you can enter that transactions manually, although it's not very common, but it happens sometimes, so that might be helpful for you in that case of scenario. Or you can just find out all the missing transactions and you can import or write it on Excel and import that manually in zero. Now, there could also be a scenario where your bank feeds begin from a different date than you actually want. So for example, you want to get all the transactions from first of January, but the bank feed automatically starts from 15th of January. So in that case, what you can do is just take that 15 days of transaction and import that manually by using the import feature to get all of these transactions, and later on, it will directly connect to the bank feeds and get all the remaining transactions for you. Also if you want to get all the previous transactions before the opening balances, rather than just directly entering the opening balances, you want to get the previous year's balances in zero. So in that case, it will be very helpful for you as well. Now, lastly, this feature can also be used for the training purposes where you don't have any transactions entered in zero when you create a new account. So in that case, you can just get a particular Excel sheet and you can use it for the demo purposes where you import all the transactions manually. So this is all about, what is the purpose of importing the bank statement and admit scenarios you might need it. Now we have explored it. Let's now see how we can do this practically in zero. 45. Importing Bank Statements From CSV in XERO: Now to import all the transaction, first of all, we need to extract the bank import template. So all you have to do is just click on this accounting tab right here and click on the bank accounts. From here, you can just directly add a bank account. And let's say it is something like a bank which is not supported by the bank feeds. So you can add it without the bank feed and click on Continue and just again, write the details about that bank. Other, you can just write the number here and click on Add account. Now, once you have created this account, it will show up right here. Now, what you can do is just click on this managed account right here and click on Import a statement. Or alternatively, if you have a habit to do everything from the dashboard, you can find that option there as well. Just go to the dashboard, and on the top, you will see this bank account. And if you want to import a bank statement, you have a direct option here. Also, you can just click on this three dots right here and it will show you all the options related to the banking. And from here, we will click on Import A Statement. And from here, as you can see that we have a three step process. One is upload, import settings and review. But before that, it is showing you how you can prepare the file for the upload to get all the transactions tightly into zero. It says, download the bank statement from your online banking, so it doesn't matter whatever bank you are using. You can just get the bank statement in one of these formats. And also you can alternatively create your own statement file with the CSV template. So here is the CSV template that you can follow. So let's explore this one. Once we click on this, it will be downloaded here. Just go to this folder, and here is my template. So on the first column, we have the dates, then the amount, the pay description, reference, and check number. So to make things easier, I'll just fill in the sample data and I'll attach that with the link of this video so you can just directly download and upload in zero to see how it works. These are all the sample transactions that I have assembled for you, so you will get this with the link of this video. Now, just make sure before importing that the date column is in the date format. So let's choose the column, go to the home tab, and from the journal, just select the short date. So this will ensure that it is now in the date format, and it will make it easier for you to import without any errors. What you also notice in the amount field that there is only one single field for both the debits and credits. That means that the amount that you have received will be shown as positive, and the amount you have paid out of bank is shown as negative. Before finally importing, just make sure that if you want to use the DD MM format, that means date first, then month, then year. Then just ensure that you have the same format in the clog as well. So if I don't have it here, I can change that before importing. So here we can see that the month is showing first, then the date and then year. So how we can correct this, let's see. I'm using Windows 11 right now, so just right click here and click on Edges date and time. Scroll down until you see these additional clocks right here. Just go to date and time, change date and time, change calendar settings, and go to additional settings, and then under the day you can change this. Now, it looks very detad, but once you click on this additional clocks, it will automatically guide you through it. It's very simple. So let's write here DD MM YY. When we click on Apply and Okay and Okay, you will notice that it will automatically change the date sequence here on Excel Sheet as well. Now we can see that we have all of the dates in the month of November. So we can see all of these transaction is for the month of November from first till 20th. Now, guys, the compulsory fields that you need to import the transaction successfully into zero is the first two columns only. But it's better if you include the pay so that we can easily identify the transaction via pay or the description. So let's include that as well. Now that we have finalized the CSV file, what I'll do is just save it as a CSV file and make it available for you so that you can just check the resources section of this video and you can just download and upload it directly in zero. Also, if you want to create it by yourself, you can just write a simple prop on hat GPT, and it will create these kind of transactions for you. So let's go to the file and click on Caves. I'll just choose the location. So I'll just simply write Bankampor transactions right here and just close it. Now what we can do is just drag and drop it or select the file from here. I'll just go to this Desired folder and you can choose the CSV file here. Now, once we select it and click on Open, it will be loaded in here. Then we will click next. So now it will show you the map and assign columns. It will automatically identify most of them, but just make sure that it easily identified the correct amounts. Otherwise, you can just adjust this manually via here. So as we can see here, it's written assigned column headings in your file to fields in zero. So to set how your transactions look, you only need to do this once, but you can edit them when you next import a CSV file. So here is the column heading from the CSV file, from the Excel file. And the preview from the CSV file, it's just showing the format on how the date looks, and it will be assigned to the field in zero, what field it will be assigned to the transaction date. So it automatically identified with the date that this is the transaction date field that it needs to map in 02. Similarly from the amount, it will be assigned to the field of amount in zero. The P is automatically identified, description is automatically identified. Now, this is automatically identified because of the exact headings that we use in the input template. Otherwise, if you have some different headings, you might need to adjust or tweak Hitler a little bit. So these are the reference field. If you want to mention the reference, let's say, I'll assign it to the reference. Transaction type transaction type, if you want to assign it to transaction type manually, as you can see here, Analysis code, if you want to assign it to analysis code, you can just assign all of these. But let's say you don't want to assign the code from here. These are the only fields that we need to import. So it says here, don't import the first line because it is the column headings, obviously. So that's right. In the Excel sheet, the first column contains the headings. We don't need to import that. So now, if you want to see the preview of all the other transactions, you can see it in the transaction preview window by clicking on the next or previous. So you can see each individual transactions, how it looks and receives in zero. So once you're happy with the results, you can just click on the next to continue the further process, and it will show you for your review the sample on what transactions are ready to be imported and how it will be done. So if you want to exclude some of the transactions, you can do it from here as well. But since I got a handful of transactions, you can just continue with this. Now, just remember if you have hundreds and thousands of transactions, it might take some time to complete the import process. I only have a handful of transactions, so the import process will be pretty shorter. So let's click on Complete Import, and now it's importing the transactions. As we can see, the 20 statement lines were imported, zero we duplicates, and we have successfully imported all the transactions in zero. So this is how we can import the transaction using the CSV file to manually import all the banking transactions in zero. Just try it by yourself, and I'll see you in the next one. 46. Complete Bank Reconciliation Process: This video, we are going to explore the full bank reconciliation process in zero. So basically, what we will learn is we will also explore how we can deal with the different type of transactions, for example, the prepayments, the partial payments. And even if you have some minor adjustments that you need to make while in the bank reconsideration, we can also see that and we will explore some of the amazing features of zero with which you can make the reconciliation as simple as possible. So we will explore all of these functions like automatic matching, auto suggestions, and also we can create some bank rules that is also an added advantage in so after that, we will also explore the case coding a really, very powerful feature. With the help of it, you can reconcile the multiple cash transactions at once. So that is the purpose of cache coding. So these are some of the amazing functions that we are going to explore in zero, so let's get started. Now for the purpose of this particular topic, we will explore all of these functions in a demo company because in the demo company, we have a couple of transactions with which we can work on. Right now, we have just learned in the previous videos how we can create a new company and import the bank statement. So if you haven't checked that out, you can just refer to the earlier ones, but you might not be needing it because we are just directly working on the demo company. To access the demo company, it's very easy. On the left hand side, you can see the company name. Just click on that and on the bottom, you will see this M zero option. Just click in here, and it will show you on the top your organization name. And also, if you want to try the demo company, it shows you this option right here at the bottom. So just click on that. And now, as you can see that it opened up a demo company. In this demo company, we have transactions to reconcile. We have the bank account. We have all the chart of accounts with data. We have all the sample invoices and bills. Now, what is the purpose of bank statement? As you can see here, in the business bank account, you can see the summary in here where we have the balance in zero of approximately 17 and $60. And on the bank statement that we imported, let's say, or we connected with the bank feed, it shows the balance of 8315. Now the bank reconciliation purpose is simply to make sure that we have recorded all of the transactions in our accounting software that is reflected in our bank statement. So once you import the bank statement whether manually or connected with the bank feed, it will automatically match all the transaction, and it will show you this screen to show the difference, and also you will see this button right here, to be reconciled items. Here in this sample company, we have 27 items to reconcil. So let's click on this button and go to the bank reconciliation screen by clicking on this blue button right here. On the left, we can see what we got from the bank statement either from the bank feed or if the bank feed option is not available. We got the transactions by importing it manually from the Excel sheet or CSV file. And on the right hand side, I have the zero accounting software transactions, which I entered in my accounting software, and I need to match it with the bank statement. So that is the simple process of reconciliation. On the first transaction, we can see the Ridgeway University, and we have received 6,187.50, and the reference number is invoice number double 025, and it exactly matches with my bank statement, and I've received the same amount. So what zero does is it highlights it in green, and zero automatically matches this. So we have the transaction that is matched, highlighted in green. Now, all I need to do is just click Okay and it will be done. Now at this stage, what zero does is it will create a received money bank transaction and update the balance in zero, and also it will mark the invoice as pad and update the each receivable balance. So that means this is the only thing that we need to do, and zero will automatically update in the report and back end records as well. So all you need to do is just click Okay to match the transactions. Similarly, if we scroll down, we can see a couple of other transactions that zero matches automatically. Now, here on this second transaction, I have Smart Agency, which is my main supplier, and I have spent money. I paid them 4,500, and I'm not sure why it is not showing in the zero records because I believe I've entered the spend money. So what I can do is to find these transactions. Just click on this fine and match option right here, which will take you to this fine and match transaction screen where we can apply different filters by amount, by name, or by reference. Now here, let's say we have a couple of transition, we are not able to find a SMRT agency directly with all of these transactions. So what we can do is we can filter or search it by name. So we will write here SMRT agency and hit Enter. And now I can see why it was not matching against this combined transaction of 4,500, which is paid by the bank, but it is against the single payment against each invoice. So that's why it is in two parts So what I can do is you can see we have spent 2000 separately and 2,500 separately, which makes the total to exactly 4,500. So this is how we can match this. We can take both of these, and it will be highlighted in green that this is matched against the two transactions selected. Now what we can simply do is, as you can see now it shows up this Okay button. All we need to do is just click on this and it will be removed from here and identified as reconciled. On the left hand side, now I can see that I have received some money from the city limousines. This is our customer. So we received the money. But here on the right hand side, we didn't find any match. And also, a comment has been put by one of our colleagues that this is a really old invoice, wasn't sure how to code it, so he wasn't sure how you can match this. He was unable to find it. So let's see if we can find it with a match and find option. Let's click on this button. Now, if we use this find and match function, we write here in search by name, city limousines, write City here and hit Enter. We can see that we have a couple of invoices, so nothing is matching exactly. But on the reference, you can see that it's mentioned 006 part. That means this payment is partially received against any particular invoice. So we have to find this 006 invoice number, which is this one. Total amount was 250. Now, since this is a transaction of $100, as we select this one, which is approximately $250, it will automatically show the option of split. So it will split the transaction so that I can allocate the partial payment to match with the bank. Just click on split here. So what we'll do is we will specify that the partial payment that we are receiving to match against the bank statement is $100, and that will leave the remaining amount of $150 to be matched in future against the total balance of 250. So let's click on split. And now as we can see the Okay button is enabled. So let's click on simply Okay, and we can also see that it is highlighted in green. Let's click Okay, and we should be able to match. Now the next transaction is of textnPperty management, and we have spent 1,181.25. And as you can see on the right, we have also recorded in zero with the same amount, and zero automatically identifies that. So it's highlighted in green. All we have to do is just click on Okay, but you will notice that this statement balance and balance in zero will not change because it has automatically identified and taken in account all the highlighted transactions that it automatically identified before we started reconslation. We click on Okay, you will notice that both of the balances didn't change because that is the 10 automatically identified beforehand. Now the next one is Jacaranda Maple systems, and they have paid us in advance. They have deposited in advance, as you can see in the reference here, and we have received the amount of $2,000. So that should be recorded as prepayment in zero. And as you can see, there is no transaction highlighted in the zero accounts as of here. Now if you quickly want to create a new transactions to match this one, you can just use this create option to mention simply who, what, and why to quickly enter the transaction. But for the prepayments and overpayments, we can click on add details to add in some further information. Now, what you can see is view your selected transaction as new transactions as needed. So here we have the option to choose how this payment is received, and it is either it's a direct payment or a prepayment or an overpayment. So in this case, it's a prepayment. So I'll select this. And the customer name is automatically filled in here, and the date, you can mention the date here keep it to current date, it automatically picks up the reference and invoice number as well. So this is all fine. Description is automatically transferred. The quantity and unit price is automatically transferred. All you have to do is just choose the account where you want this transaction to be entered. So I'll write here, revenue received in advance. Now, guys, if you are practicing the bank reconciliation on a new company of your own, then it's possible that you won't find this account because this is a sample company where it has created a couple of accounts and the transactions, according to the company's scenario. So I'll choose this revenue received in advance, and then we will just simply scroll down and save this transaction. So now you can see, it's mentioned here with the figure that totals are matching now. If we scroll a little up, you can see that it has created a prepayment transaction and has matched against the bank statement, and we are getting the option to click on Okay. Now all we need to do is just click Okay to reconcile this transaction. Now the next one is Ridgeway Banking Corporation fee, and these kind of bank fees are not by default entered in zero because that is the transaction that we only know when we check the bank statement. What kind of charges does the bank deducted? We can only know when we check the bank statement. So most of the times, you can check the bank statement and then enter that particular transaction. But as you can see on the right hand side, although we are on the Create tab, it automatically fills in all the details based on the previous data that we might filled earlier because the bank fees, let's say, deducted on a monthly basis. So it has picked up all the details and made the transaction ready for you. What you need to do is just check all the details. And let's say if you want to change the ledger, you can do so. But in this case, it has identified it perfectly, and if you are happy, you can just click Okay, and what it will do it will create the transaction and then reconcile it for you. How cool is that? Now, other amazing function of zero is on the left hand, you can see this transaction on 15th of November 2024 of 711. We have spent something like $15.50, and on the right, we can see the applied rule area. That means we have applied the bank rule that let's say we spend a lot of times on the 711, we just shop it from there. So I want zero to create automatically a transaction for it, matching with the bank. Every time I spend money on 711, I want zero to create the exact same transaction and match it for me. So it has applied that rule, and it will automatically create the transaction and match it with the bank statement as I click Okay. So this is another useful feature of zero, which a huge time saver. It's called the bank rules. Let's click. Okay. Now, on the left hand side, now we can see a next transaction that is Cooper Street Bakery on 15th of November 2024. But on the right, although we're on the create tab, you can see that there is no auto suggestions or a match found. That might be because we are spending this money on the Cooper Street bakery for the first time, so it's not identified in zero, and we have to manually enter it. No whenever you want to enter all the transaction by yourself, a complete brand new transaction, all we need to do is just fill in the who, what, and why details. So in the name of the contact, we have to write this Cooper street. And what it will do is, as we start typing, it will automatically pick up all the contact data and you can simply choose it from there. But since this is the first transaction we are doing with this supplier, we can just copy this details right here and just simply paste it right here. And as this is a new contact, it's not identified, so that's why it's showing this new contact option. Let's click on plus, and it will add it for us as a new supplier. Now, in what you have to choose where this expense goes. So let's say this is a refreshment. So this should go in journal expenses. I'll just write journal here and it will automatically show you the suggestions, and in why, you need to mention some description. So it's always a good idea to mention the description so that you can identify the transaction later on on what this transaction was all about. So let's say we have bought some sandwiches, for client meeting. And that's pretty much it. Now it's showing the option of o. So what we do is we'll create the transaction for you and match it against the bank statement. So let's click Okay. Now the next transaction is of Swanston security, and we have paid this supplier 59.55, and let's say that I exactly remember that I have paid to this Swanson security because this is my frequent supplier. I remember this payment. But why I'm curious on the right hand side, why it's not showing anywhere. So I need to find this. Let's go and find and match. And we can search it by name if you have a lot of transaction and you are having trouble to find it. So let's write Swanston hit Enter. And as we can see that we have paid for this, but why it's not showing? The reason being we have slightly overpaid the payment. The invoice was for 59.54 while we paid 59.55. So it's only $0.01 that we need to add in order to reconcile this. And it's super easy to do it in zero. Let me show you how just select this transaction. And after selecting, just scroll down until you see this adjustment. You can also see that total is out by 0.01. So this is called the minor adjustment. What we will do in the sum of your selected transit must match the money spent. So you can make the adjustments here. You have the adjustment, and it's not the bank fees, it's a minor adjustment. What it will do is it will move this 0.01 adjustment in the rounding account. So that's basically a rounding difference. So click on this one, and right here, the minor adjustment is 0.01. And as you write it in here, it automatically changes it to totals Match. So we have matched the transaction successfully, and the difference, which is a minor difference of just a rounding is transferred to the rounding account. So that's all we have to do, and you can see how convenient it is with the functions of zero. It is to reconcile all of these type of adjustments. So let's click on Reconcile. And now it's math and go from here. Now, again, it found a match of gateway motors. Four double 1.35, it automatically identifies it and highlighted it as green. So let's click Okay to reconcile. Next transaction is of 16th of November 2024, and it says E bank deposits. So basically, we have received the money in this particular bank account, but that is the transfer we made from our savings account into our current account. So that is a simple bank transfer from one of our savings account. So in this case, we will use the option of this transfer tab right here, go to the transfer. You can select the bank account from where the funds came from. In this case, it's a business saving account. And if you want to mention any reference regarding this transition, it's always useful. So let's say says bank TRF 005 November 24, something like that. So now we can simply click Okay. Now when we click Okay, it will do two things. First of all, it will reconcile the transaction in the business bank account, and also it will create a new entry which creates a new transaction of transfer from the business saving account to the current account where we receive this money, right? So click Okay, and now it's reconciled. Guys, before moving to the next transaction, I accidentally stopped the recording and I reconciled the transaction. But that's a good thing because this is how we learn that if you accidentally reconciled by mistake and you want to correct that, you want to unreconciled that particular transaction so that it can show up back in the reconciliation area. As you can see, now it's removed from here, you might see a different transaction for the Cooper Street here. But since we haven't recorded that, I already reconciled it, and now it's showing in the accounting transactions. Let's say you have made this kind of mistake, now you want to unreconcile this. So all you have to do is just click on this transaction right here. It will open up the spend money option where the transaction was created and reconciled. As you can see on the top, the transaction is reconciled. But on the right, we have the options. Just click on here and we find this one, which is unreconciled so this is the option we want to use. Click here, and it will simply show you this message that unmark as reconciled. This will only remove the link between the imported statement line and the accounting transaction in zero. Both the statement account will remain. So both of the transactions will remain. Only difference is it will change the stated back to unreconciled. And that's exactly what we want here. Click Okay. And now the transaction is unreconciled. Let's quickly go to the dashboard, or you can simply go back. Let's say we are doing it from the scratch from the dashboard, click on Reconcile 16 items, and now you should be able to see your transaction that we need to reconcile. Here is it. If you want to delete this transaction, you can delete that when as well. Now to delete this transaction, if you have entered it in the accounting transactions already, now the status is changed to unreconciled but let's say I want to completely remove and redo it. Let's select this and you can remove and redo from here. Click, and now we move back to the reconciliation, we should be able to see on the right we are in the create mode. That's exactly where you will be at this point. So let's continue. The next transaction is of 16th of November 2024 and its Cooper Street Bakery. Now this transaction has comed again before it was for the first time. Now it is for the second time, and we are purchasing spending money of 11.90 approximately. So on the right, you can see now it automatically suggested that and fill in all the details for you, whether it's who, what, and why. So in the who it selected the supplier in what it has identified based on the earlier transaction, the right journal ledger area, and in why it has automatically filled in the description that you have used earlier as well. So let's say if this is different this time, it's about muffins. In staff meeting, you can change the description however you want. And once you are happy, just click Okay to reconcile. Now, here are some of the basics of the bank reconciliation. Now, what you can do is just continue in the same way as I showed you for all the remaining kind of transactions. But I want to show you a more amazing and powerful way for doing bank reconciliation in zero. And that is an amazing function that zero offers, and that is cache coding. So it's a really powerful tool to code the cache transactions in bulk so that it automatically identifies all the transactions for you. We have this tab right next to this reconcile option. So let's quickly go to this cache coding and see how it provides you with this facility to work or reconcile even faster. Let's click on this cache coding right here. And once you click on it, you will find a sheet, just like a spreadsheet on an Excel sheet here, where you have the option to check or uncheck all of the transactions. Now, as you can see here, we have a couple of options which make easier for us to reconcile the transactions. You can sort it by date or by pay reference number, description, whatever. So let's sort it by pay. Now, as we sort it this by pay on the top of 711, you can see that the description and account details and the account is automatically selected, but that is just for the 711. Why? And why it's not selected for every other item because we have set the bank rule, as we have seen earlier, for 711. So it's very handy if you use regularly the similar account for all of the transactions, and that's exactly the case with most of the transactions, obviously, you will spend in the same account for city Central parking. It goes under the same account every single time. So it's very handy if you identify all of these transition as a bank rule, and it will fill in all the details for you. All you have to do is just to reconcile, just click Save and reconcile all, and it will do the job for you. Right now, if I click on Save and Reconcile A, it will only save this one, and it shows you that it is reconciled successfully. Click Okay. Now, before applying the rules or something like that, what we can do is, let's say, for the first one, we will just select this one and even not select this one. Just for the ECL conferences, we will choose that it comes under the advertising. So we usually do this for advertising. Choose here. And the next one is for city central parking. Now, as you can see that it's not only one transaction, it's a couple of transactions. So let's say that you want to select the account for all of them in a single go. So it's very convenient to do. What you can do is just go to the left hand corner and just select the first transaction and hold the shift key and select the last one, highlight all the transactions in between. Now what you can do is just simply select one account, and it will fill in the details for all the other lines as well. For this particular expense, I'll choose motor vehicle expenses for this. And as you can see, if I click anywhere else, it's filled in with all the details in other accounts. So you can see that instead of manually doing it every single time, like one by one, we can now click on Uncheck A, and this is all the transactions ready, especially these six transactions and click on Save and Reconcile A. And now we can see how quickly the six transaction were saved and reconciled successfully. That's the power of the case coding. Uh, now the next one is E cash deposit. This was some funds that we introduced in the business. So let's write owners, owner fund introduced. Now again, this is the sample company that we are talking about this demo company Global. If we start a new company, we might not find the exact same accounts. So just select that. Now the next one is the majestic contracting. This one is for, let's say, cash sales, and let's say that we don't have any invoice for that. So this is just a sale that we directly book. So let's quickly choose the sales right here. The payment to the new world was made. The payment is approximately of 34.60, but this should go in two separate accounts. I bought some for the personal use and I bought some for this stationary. So in this kind of particular scenarios, what you can do is just hit the forward slash here and it will take you to spend money option. So here, it allows you to enter this transaction against the multiple accounts. So let's say some of them were for some kind of stationary. So let's choose the stationary here and the region, let's keep it blank. And the amount we spend on the stationery is, let's say, dollars. And as we can see, total is out by 14.60. So the rest of them, since we have bought it for the personal use, the owner has bought it for the personal use. So it is considered as owner drawings. So owner A drawing, I'll choose this one. And the remaining amount of 14.60. Now, let's click on Save and as you can see that it is reconciled against the multiple line items, and that is amazing function in zero, how it provides all the advanced functionality to quickly reconcile, even if you have some complex scenarios. Now the remaining transactions, let's say for the park side, kiosk, Ridgway Bank and White Cole, it's all about the stationary. So let's quickly select this was one. Make sure that it is shown as a checkmark, and just hold the Shift key and choose the last one. So it will select all of these, and I can quickly select the single account and it will continue for all the lines. So let's choose stationary here. As I click on anywhere else, it will show and fill in all the accounts. After that, we have done all of these transactions, just click on uncheck all and all the transactions are ready. Now we have the seven transactions ready right away with just a few clicks, and if you click on Save and reconcile all, it will complete the transaction for me and as you can see that seven were saved and reconciled successfully just like that. You can see how quickly this case coding system works and make it very easy for us if you have a couple of hundreds and thousands of transactions that you need to reconcile. Let's click Okay and now we are left with this E bank deposit. And as we have seen earlier, this is the internal transfer that we did from our savings account into our current account. So this might not be a suitable area for that. It's more convenient with the reconcile tab function. So let's go back and jump to reconcile tab. And as you can see based on the earlier transaction reference, it automatically showed you the transfer option, and also it has selected the account for us that is business saving account. So with this transaction, it will do two things. One, it will reconcile it against the bank statement. And second one, it will create a new entry where we have transferred the saving funds to our current account. Let's lick. Okay. And this is all done. And now we did a great job, and we have reconciled all the transactions for the accounts and the statement balances. This one, so this is it. This is how you can quickly reconcile with the amazing functions of zero. And you can check the reconciliation report on the right hand side. And here we get a green tick with showing us that we have did a great job. So that's really motivate us. We can just click on the reconciliation report and it will open up the report for us, something like this. And after that, you can just export it and save it anywhere you want. That's pretty much it. This is how you can reconcile the bank transactions. First of all, what I recommend you to do the same in the demo company, and then you can practically apply in whatever company you're already working on. Thank you so much. 47. Handling Petty Cash: This video, we are going to learn about petty cash and how we can deal with this zero. So a petty cash is simply if your business pays for small expenses, using cash, it's important to record those transactions in zero. So this basically ensures that you have entered every particular expense, not just the ones that you have only done from the bank, but also all the little expenses that you spend on a daily basis from the petty cash for these minus expenses like refreshments, stationery, whatever. There are two ways to manage the petty cash. One, you can manage it from the bank account by creating a bank account, and other one, we will cover it later where we will learn how you can manage the petty cash by using the Manual journals option. Here we will learn the complete process of how you can set up a petty cash account and how you can add the funds to it because if you're using it as a bank account, you might need to transfer in some funds from your main bank account. And finally, we will explore that if your reconciliation has some problems or some discrepancies, how you can resolve all of these. So let's get started with this interesting topic. So first of all, we will see the method one, which is creating the petty cash account from the bank account option. So all you have to do is just go to this top bar where it says accounting and click on bank accounts. And from here, let's click on Add a bank account. So let's write here petty cash. Now, obviously, you will not find any match because this is directly connected to the bank feeds of zero that supports all the banks. So we will click on this ad without a bank feed option right here at the bottom. And it says that you want to do this. We will ignore all of this because we're just creating the petty cash. It's nothing related to the bank account. So let's click on Continue. Now here we need to mention the bank name, which is peri cash. Now, here in the account name, we will again specify this, copy and piece that. And under the account type, we can mention other. And here in the account number, you can mention any reference number, so we can write 001, whatever, like this. And the currency is US dollars. Now let's click on AD, and this is how you can easily add a petty cash account, as you can see, it's now added, but it has zero funds because it is added as a bank account, so we will need to transfer some of the funds to petty cash so that we can make some expenses here. Now, if you want to introduce some funds or put some balance in the petty cash, you might consider an exact scenario which your particular company scenario has. For example, you are transferring the funds from a manual accounting system. So let's say that you are transferring the funds all to zero, and you were implementing zero before you were working manually or you were working on spreadsheets. So this business, let's say, is not new. So in that case, you have to transfer the petty cash balance as an opening balance just like you do for any other ledger. But let's say if this is not the case and you now created the petty cash account, you will transfer the funds from your bank account to the petty cash account. We also do is sometimes the business consider all the cases, the petty seals in the petty cash, and they fund it from there. And lastly, if you are a sole proprietor and you injected this petty cash by your pocket, so in that case, it will be fund introduced or investment by the owner, which will be dealt as capital. So let's consider the first scenario in which we have to put an opening balance of petty cash for that. Scroll up and just go to this accounting tab right here and click on Advanced. And under the advanced settings, you can scroll down to the bottom and it says convergent balances. You can market as favorite so that it can show up directly here. So you can do that, as well. Let's click on Conversion Balance. Now here, you can just simply put your opening balances, which is, let's say, 500 and click on Save. And now the balances are saved. But if you're having some problem and it moves to a different area where it says out of balance or something like that, you can check out the earlier videos where we have completed a project and put all the opening balances, including debtors, creditors, inventory, and all the other assets and liabilities. So you can check that out. So now, when the balance is entered and you can see the stick right here and you can just go to the bank account and you can see the statement balance of petty cash right here. All right now let's see a new scenario where I want the funds in petty cash. But that is against the bank transfer. So in that case, what you can do is we have the business bank account. We can transfer the funds directly from the main bank account to a petty cash account. So just simply click on this three dots right here and it shows this option of transfer money. Just click in here. Going to take you to the screen of transfer money. Now we will choose simply the account from which we are transferring the funds to the account on which we want to transfer the funds. So that is petty cash. So on the current date, I want to transfer this, and let's say, I want to transfer $150. So you can mention a reference here, like Bank TRF 001, whatever. So let's click on Transfer. And this is another way of getting the funds in petty cash. So now you can see the new balance in petty cash is $150. Before when you put the opening balances, we took an example of XYZ company, and now we are doing this one in the Demo global company, which is offered by default in zero. So if you want to check the bank account after that, you just click on this accounting tab right here and click on bank accounts. It will show you this balance in zero. Now one thing you will notice that if you go to the dashboard, we can see the petty cash is showing the balance in zero is 150 and the statement balance is zero, so we haven't yet reconciled it because we don't have any bank statement yet received of these transactions because this is the new transactions. So once we do that, we should be able to reconcile that. Even in the accounting and bank account tab, if you click here, we can see this difference right here. So it says Import a bank statement to get started with the reconciliation. But right now, we will not do this let's consider a third scenario where we have received the funds in the petty cash, but that is against the sales or directly given by the owner. So in both of these cases, what you can do is just go to this managed account right here and click on Receive Money. Or if you are in some other area, let's say, on the dashboard or Bre Ever, even on the same page, you can use this plus sign right here to receive the money as well. So just click on this receive money. Let's see what options do we get? So it says here, select a bank account to make a payment too. So we want to receive the payment in petty cash. Click Next. So let's see in the first example, let's say that we want to put our own money into petty cash. I'm the owner of the business, so it is received by Sad. My name is Sad. So let's put it here. And let's write here cash in unit quantity, we will keep it one just to enter the field. And let's say we have injected $50. Now, this one will be considered as the owner introduced funds. So let's write funds here. So it says owner A funds introduced. That's the letter that we will choose, and now we can click on Save. And as we can see now the balance is updated in zero before it was $150 and now it is $50 more. So this makes up the total to 200. Let's consider a third scenario where we are receiving the funds against the cash sales into petty cash. So the method will be quite similar. What you can do is just click on this plus sign right here again and click on receive money and just choose the petty cash and click Next. Now let's enter the cash customer here. Now, the cash customer might be just a walk in customer and it's not a regular customer, it's just a real customers. So we will enter it with a cash customer name, whoever it is, so that we don't have to create multiple customers for that. Let's say we are receiving this on 24th of November. So let's write cash sales here. And you can put any description. I'll just mention cash seals right here, put up a quantity. And let's say we are receiving this cash as like $45. And we will choose the sales account for that and make sure to mention the tax rate as exempt seals or tax exempt so that it shows the total properly and click click Save. And again, as you can see, first time, the balance was 150 from the bank transfer. The next one was capital injected by the owner, and the next one is the cash sales recorded against petty cash means retrieved in Patti this all makes the total to $245. These are all the scenarios that you can inject the petty cash in your business. So as we can see on the right hand, the status is unreconciled because we haven't mated with a bank statement. So for now, we don't have any bank statement to mat it to. Even if we check this reconciled tab right here, there is nothing shown here because we haven't imported a bank statement yet or connected to a bank feed. So in that case, we will keep it as it is for now. Now, in the petty cash bank account, obviously, you will not see all of these little transactions in the bank statement because there isn't any bank statement for petty cash right. So in that case, you might want to reconcile it manually as all the status shown as unreconciled. So this is the scenario where we will manually reconcile this and change the status for all of these transactions. So let's select one of the transaction. And after that, just click on this question mark right here, and this will open up this area. On the corner at the bottom, you will see this enable mark as reconcile option. So I'll just enable this, and what it will do is for the next time, it will show it as more option. And now what you can do is for all the petty cash transactions where the bank statements are not there and we don't need bank statements to reconcile Better cash balances. This is just an internal day to day expenses. Let's select all of them and click on Me and mark as reconciled. It will show you this little warning right here. It is recommended that you only mark as reconciled in cases where original bank statement cannot be imported from the bank. So this is exactly the case where we don't have any petty cash bank statements. So you can click on Don't show this warning anymore, or you can just simply continue and click on Mark as reconciled. And as we click immediately, you can see the status is changed to reconcile. Now also, you will see the bank transaction source is not the bank statement, but the user. That means we have manually reconciled this. And now on the top, you can see that the Pettigah account is reconciled. We have $245. So if you click on the dashboard right here, you will see now it is showing as reconciled. All right. Now let's see how we can enter and reconcile the payments against the petty cash. Now, the first method is we will enter all of them manually from the spend money option, all the individual's petty expenses. We will just click on this plus sign right here and click on spend Money. Choose the petty cash, click next. And let's say we paid for some office grocery. We will mention it office grocery. This is the main account. And let's say this is for tea bags. And this is a minor expense. Let's put a quantity of one because we are not actually tracking the quantity of the office refreshments. We'll just put the expense right away, and let's say it was for $4, and this is for office expenses. Just put it right here. And make sure this is set to tax exempt, and let's click on Save now. And now on the top, you can see this in the spent money option. We have the payment of office grocery, which is unreconciled. So let's quickly select this and click on more to Mark as reconciled. We will manually reconcile it and click on Mark as reconciled. And now all of these are reconciled. Now this is a way of entering petty cash transactions. You can just simply use this option and do it individually for all the items and then select all of them to reconcile this. But let's say we want to find a quicker way, and let's say our D two data transactions are recorded in Excel or let's say we are maintaining it on some other software or even on WhatsApp. We want a system with which we can not only reconcile all the balances automatically, but also import all the balances simply by just using an import template. So at the same time, not only will create all the entries, but it will reconcile them for us. And for that, we only need an import template, which is by default present in zero. So just click on this managed account right here and click on Import a statement. And it says here, you need to upload that template. So first of all, we will download this zero CSV template. And let's press Escape. And let's see now it is downloaded here. Let's open that up. You can name it however you like. And I'll just copy all of the column names and just generate some sample data with the help of chat GPT. I'll put it here and just write here a prompt. This is zero template. Enter 20 sample transactions for Petty cache. Let's see how it does it. So as we can see, these are the transactions that it has written. So let me just copy this all and let's see if it works properly. Let's space it right here. Just delete the extra heading, and this is all filled up. Let's click on Save and let's try to import this. Now, let's upload this file, which is present in the downloads. The file. All right, now that statement is uploaded, right? So let's click next, and let's see how it performs all the actions. As we can see that the column headings from the CSV file are assigned automatically to the zero fields. The only fields that we need to manually assign is the reference. Sometimes it doesn't assigns that automatically. So that's not a problem. The check number, you will assign the check number right here. As we can see, this is some difference with the spellings. So that's why we have to manually assign them. And this is the preview from the CSV files, how it will be imported. And don't import the first because they are column headings, obviously. So let's keep it checked. Click Next, and these are all the transactions. Now, you will notice that once I import this, not only this will create all the petty cash transactions for us, it will also reconcile it at the same time. Let's click on Complete Import. After importing this, you might be wondering why it's not showing yet reconciled, because this is the default procedure that once you import this statement, it will be shown as reconciling, and you have to manually create transactions for all of them against the bank statement and then reconcile it. But the quicker method of doing this is the final step that is case coding. Let's select all of them and just choose the account for one of them. Uh, and these are all related to the office expenses, right? So I'll just choose office expenses and make sure the text is exempt because my business is text exempt. So let's click on Save and Reconcile selected. So now the 20 transactions are reconciled. If you click on the dashboard to check the status, you can see that we are totally reconciled. If you check the petty cash ledger, it's also showing the reconciled, and you can check and see all the transactions as reconciled. Now the final thing to do and implement in your business to have a great business control is manually just checking it from your actual cash float that you have in your drawer, to make sure that you have the same balance as shown in the petty cash because that will help you identify what cash maybe you forgot some transaction, maybe some cash cut missing. So it will help you to identify those. And after that, if there is a minor discrepancy, it's up to you or your company policy how you want to record it. So you can either record a ledger of underos to pass all of these adjustments. And let's say if there is a minor adjustment of, let's say, within $10 within $5, so you can adjust that in the adjustment account. Otherwise, you can investigate. Your company policy might be different and you want to, let's say, investigate each and every single item, so it's up to you. Now, let's say that I have the policy in my company that I only investigate the figures, which is over $1. So let's say I check the petty cash, and I only have this 647 in the actual cash, so I want to reduce this $0.50 as an adjustment. So that should be recorded as an expense to reduce this balance. What we can do is in this situation, just click on this plus sign right here, click on spend money, and we will pass a small adjustment entry. We'll choose the petty cash. And let's say this petty cash adjustment, I'll make the name of in the two section. And let's say this is today's date adjustment. And we will mention here as well this is a petty cash adjustment. Quantity is, let's say, 1.5 point $0.05 I want to adjust, and let's write overs and unders overs under adjustment. I'll create a new account because I don't have one, so let's add a new account. So it's ideal if you pass all of these adjustments in the equity balances. So let's choose that, and let's write over under adjustment account. And you can put the seam in the description as well and click on Safe. And now you will save this transaction, make sure it is text exempt. And now the balance in zero is 647 reduced from the $0.50. Now you need to manually reconcile in order to match both of these. So in that case, just select that and click on Mark as reconciled and click on Mark as reconciled. And now the statement balance is fully reconciled. So that is how we can enter and reconcile the petty cash by using the bank accounts option. So this video is all about it. If you want to learn how you can use and manage petty cash with the manual journals, which is right here, you can learn this on the next video.