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Red Wing Windows Accounting Series

General Ledger

by

Red Wing Business Systems, Inc.

All rights reserved. No part of this book or system may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by information storage retrieval system, without permission in writing from the publisher. Changes in tax law, business practice, or your operating environment may cause your system to require changing. Red Wing cannot guarantee these changes will be reflected in future releases of software. This system is sold with the understanding the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Microsoft, Microsoft Access, Microsoft Word and Microsoft Excel are all registered trademarks of Microsoft Corporation. Windows is a trademark of Microsoft Corporation.

Portions copyrighted by Open Systems, Inc.

Copyright Red Wing Business Systems, Inc. May 1999, Revised October 2000

ISBN 0-87265-256-4

Important

Please complete the software licensing agreement and return the white copy to Red Wing Business Systems. Returning the licensing agreement benefits you in the following ways: Upon receipt of your agreement, we check your serial numbers to make sure you have a current version of our product. If you do not have a current version, we send you one at no charge. We keep you informed of improvements to our software, including releases of new versions. We also send any seminar information to you.

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Table of Contents iii

Table of Contents

Chapter One

Introduction

Introduction................................................................................... 1- 2

General Ledger Flexibility............................................................... 1- 2 Windows Compatible..................................................................... 1- 3 How to Get Help ............................................................................ 1- 3 General Ledger Features ............................................................... 1- 4 How This Manual is Organized....................................................... 1- 7 General Ledger User's Guide Formatting Standards...................... 1- 8

Chapter Two

Getting Started

How to Set Up the General Ledger................................................. 2- 2 Before You Begin........................................................................... 2- 2 Defining IDs, Codes and Accounts................................................. 2- 3

1. Complete Setup in System Manager.......................................... 2- 4

2. Set Up Customization................................................................ 2- 4

3. Set Up Accounts........................................................................ 2- 4

4. Optional Information.................................................................. 2- 7

5. Set Up Financial Statements...................................................... 2- 8

6. Make Opening Entries................................................................ 2- 9

7. Budget and Forecast Balances................................................... 2-10

8. Set Up a Backup Schedule......................................................... 2-10

Chapter Three

Practice System

Exercise 1: Set Up New Company ................................................ 3- 2 Exercise 2: Add A New Profit Center ............................................. 3- 8 Exercise 3: Enter Beginning Balance Transactions ........................ 3-14 Exercise 4: Print Financial Statements .......................................... 3-19

Chapter Four

Helpful Procedures

How to Set Up Autosplit Accounts ................................................. 4- 2 How to Enter Beginning Balances ................................................. 4- 2 How to Process Transactions ........................................................ 4- 4 How to Set Up Financial Statements ............................................. 4- 5 How to Change the Fiscal Year ..................................................... 4- 6 Year-End Processing..................................................................... 4- 6 iv Table of Contents

Chapter Five

Transactions

Transaction Entry - Overview..................................................... 5- 2 Transaction Entry......................................................................... 5- 5 Transaction Options................................................................ 5- 8 Out of Balance........................................................................ 5-10 Copy Recurring Transactions....................................................... 5-12 Copy Recurring Transactions Report ...................................... 5-14 Copy Recurring Transactions Error Listing.............................. 5-16 Copy Recurring Transactions Copy Listing.............................. 5-17 Edit Transactions......................................................................... 5-18 Edit Transactions Options....................................................... 5-21 Edit Transactions Out of Balance............................................ 5-22

Chapter Six

Red Wing DOS

Interface

Retrieve Transactions.................................................................. 6- 2 Edit Transactions (Accounts)....................................................... 6- 5 Edit Transactions (Periods).......................................................... 6- 6 Create Chart of Accounts............................................................. 6- 8

Chapter Seven

Transaction

Reports/Post

Transaction Journal ..................................................................... 7- 2 Account Activity........................................................................... 7- 5 Post Transactions........................................................................ 7- 8 Review Transactions.................................................................... 7-12 Account Inquiry............................................................................ 7-14 Check Register............................................................................ 7-16

Chapter Eight

Management Reports

Report Command and Toolbar Buttons........................................ 8- 2 Working Trial Balance.................................................................. 8- 5 Trial Balance................................................................................ 8- 7 Financial Statements................................................................... 8- 9 Cash Flow Report ........................................................................ 8-20 Graphical Report.......................................................................... 8-23 Budget/Actual Report................................................................... 8-28

Chapter Nine

End-of-Year

End-of-Year ................................................................................. 9- 2 Change Current Fiscal Year......................................................... 9- 3 Add Prior Fiscal Year................................................................... 9- 4 Remove Fiscal Year..................................................................... 9- 5

Table of Contentsv

Chapter Ten

Utilities

Recalculate Account Balances..................................................... 10- 2 Zero Account Balances................................................................ 10- 3 Summarize Transactions ............................................................. 10- 5 Copy Account Balances............................................................... 10- 7 Copy Chart of Accounts............................................................... 10- 9 Copy Sample Chart of Accounts................................................... 10-12

Chapter Eleven

Special Options

Change Posted Transactions....................................................... 11- 2 Report Designer........................................................................... 11- 3 Change Account Number............................................................. 11- 4 Change Account Structure........................................................... 11- 5 Consolidated Statements ............................................................. 11- 6 ASCII Input.................................................................................. 11- 7

Chapter Twelve

Setup and

Maintenance

Customization.............................................................................. 12- 2 Account Structure........................................................................ 12- 4 Account Classes.......................................................................... 12- 7 Account Types............................................................................. 12- 8 Account Segments/Profit Centers................................................. 12-10 Chart of Accounts........................................................................ 12-12 Account Autosplits....................................................................... 12-16 Recurring Transactions................................................................ 12-18 Account Budgets.......................................................................... 12-21 Account Balances........................................................................ 12-25

Chapter Thirteen

Management Reports

Setup Define Statement Contents........................................................... 13- 2 Maintain Statement Contents.................................................. 13- 4 Add New/Insert/Edit........................................................... 13- 7 Copy Statement Content......................................................... 13-10 Delete Statement Content ....................................................... 13-11 Build Statements.......................................................................... 13-12 Maintain Statement................................................................. 13-13 Copy Statement...................................................................... 13-16 Delete Statement .................................................................... 13-17 Define Cash Flow Contents.......................................................... 13-18 Build Report Queues.................................................................... 13-21 Maintain Queues..................................................................... 13-22 Add/Insert/Edit................................................................... 13-24 Copy Queues.......................................................................... 13-26 Delete Queues........................................................................ 13-27 Pretest Queues....................................................................... 13-28 vi Table of Contents

Chapter Fourteen

Setup and

Maintenance Lists

Account Classes List.................................................................... 14- 2 Account Types List....................................................................... 14- 4 Account Segments/Profit Centers List.......................................... 14- 6 Chart of Accounts List.................................................................. 14- 8 Account Autosplits List................................................................. 14-11 Recurring Transactions List.......................................................... 14-13 Statement Contents List............................................................... 14-15 Statement Definitions List ............................................................ 14-17 Cash Flow Contents List .............................................................. 14-19 Report Queues List...................................................................... 14-21

Chapter Fifteen

Basic Accounting

Concepts

Introduction................................................................................... 15- 2

Key Accounting Terms and Concepts............................................. 15- 3 Understanding and Using Double Entry Accounting........................ 15- 9 Using Financial Statements in Decision Making............................. 15-12 Balance Sheet - Example and Analysis.............................. 15-12 Income Statement - Example and Analysis........................ 15-13

Combining the Income Statement and Balance

Sheet to Make Decisions ..................................................... 15-14 How You Can Learn More.............................................................. 15-15 Chart - Relationships Between Debits, Credits and the Basic Accounting Equation...................................................................... 15-16

Appendix

How to Order Checks and Forms................................................... 16- 2 How to Sign Up for Red Wing Customer Support........................... 16- 2

Glossary........................................................................................ 16- 3

Introduction to the General Ledger 1-1

Chapter O

n e - Introduction to the G e neral LedgerThis chapter introduces the General Ledger, its features and the organization of the User Guide.

Contents

Introduction.............................................................................. 1- 2 General Ledger Flexibility......................................................... 1- 2 Windows Compatible............................................................... 1- 3 How to Get Help....................................................................... 1- 3 General Ledger Features.......................................................... 1- 4 How This Manual is Organized................................................. 1- 7 User Guide Formatting Standards............................................ 1- 8

1-2 Introduction to the General Ledger

Introduction

The Red Wing General Ledger organizes the information you need to make sound financial decisions, making financial planning more efficient, accurate and faster. It is a double entry accounting system, following Generally Accepted Accounting Principles (GAAP) suggested by the Financial Accounting Standards Board, giving you accurate, up-to-date financial information that is extremely useful to you, your banker and your accountant. For Help on Red Wing standard key commands, the menu bar, the toolbar, and other general definitions, see your Windows Accounting Series

Getting Started Guide.

General Ledger Flexibility

Customize the General Ledger to accommodate your business, regardless of size or complexity. Set up your own Chart of Accounts, using the sample data as a template or design a new Chart of Accounts perfectly suited to your operation. Also, define reports and profit centers according to your specifications. When setting up the General Ledger you can determine your account number size, its format, and how it will be entered. You can also control period ending dates and the length of periods (months, quarters, etc.). As you begin, design the General Ledger as a simple financial management system. Later, add options as you become comfortable with them - without changing software or affecting your data.

Introduction to the General Ledger 1-3

Windows Compatible

The General Ledger is a Windows-based system with all the windows versatility and power. The system follows normal windows standards and utilizes many windows features, including easily accessed online help and access to powerful printing and e-mail capabilities. Developed using Microsoft Access 97, the system lets you use Object, Linking and Embedding (OLE) to send reports to Microsoft Word and to

Microsoft Excel.

You can also quickly switch from your General Ledger to other windows software, such as spreadsheets and word processing programs.

How to Get Help

Online Help - Anytime you need help while working in the General Ledger, press F1 to display online help. You can also click on the Help icons to get help, or choose from the help selection on the Help Menu. Sample Data - Use Red Wing's sample data (with SAM as the company code) to practice new activities or to refresh your memory on infrequently used activities. Cue Cards - Handy Cue Cards stay on top of your screen, giving you step-by-step directions for many procedures. User Guide - The User Guide is another useful source of help. Use the comprehensive table of contents, glossary and index to search for terms and activities. Custom Help - Press Shift F1 to create your own online help notes for any screen. Customer Support - And remember, Red Wing's Customer Support team is available to subscribers, ready to answer any of your questions, quickly and competently. For more information call 1-800-732-9464.

1-4 Introduction to the General Ledger

General Ledger Features

Profit Center

(Enterprise)

Accounting

Good management requires your knowledge of the profitability of each profit center (or division, department, etc.) in your business. With the Red Wing General Ledger, handle an unlimited number of profit centers. Also, split overhead expenses among profit centers. Define one of the account segments as a profit center and make the segment as large as necessary. For example, a two-character segment can handle 100 profit centers, while a three-character segment can handle

1,000.

Comprehensive

Reports

Set up General Ledger Reports quickly and easily and customize them to show the information you want. The standard report formats work for most businesses, but you can change key financial statements (Income Statement, Balance Sheet, Cash Flow) to print exactly how you want them. You can change how the reports look (where totals are printed, what order accounts are listed in, what type of subtotals are included, etc.) so they fit your specific requirements. All reports have a variety of selection criteria you can use to change the amount of information included on the report. For example, you could restrict the report to a specific profit center. Send reports directly to Microsoft Word or Excel for special formatting when you want to make them look especially good for a presentation. For example, make the report headings big and bold, add color, or add your logo to the report. You can even add graphs to your report. The possibili- ties are endless when you tap into the power of Microsoft Word or Excel.

Graphs

Use these exciting, visual representations to show trends and comparisons by account. There are five different graph types: vertical bar line graph vertical bar 3-D line graph 3-D pie chart

Introduction to the General Ledger 1-5

Transaction

Entry Enter transactions into prior years as well as the current year. This makes it very easy to close the current year and to go on with a new year while waiting for end-of-year adjustments. You no longer have to accumulate several weeks of entries for the new year while waiting for some final checks or bills from last year. Enter recurring transactions. It is very easy to set up your common monthly bills and then select them at the end of each month. Enter reversing transactions to easily record accruals in one period and automatically reverse them in the next.

Additional

Features

Split Expenses - The handy autosplit feature lets you split expenses among profit centers. You can define accounts so that transactions entered to those accounts are automatically split into several other accounts. This is useful, for example, when you have multiple profit centers and you want to split a percentage of each bill to those profit centers.

Network Compatible

- Use multiple menu level passwords to restrict access.

Flexible, Expanded Account Number

- When you set up your accounting system in the System Manager you can have an account number with up to 10 numeric or alphanumeric characters, separated into as many as three segments, such as "main," "subaccount," and "profit center." You decide how many sections and how long each is. For example, you could use any of the following account formats: 1030-00, 5310-16-170, 1014171.A10, or CHECKING.

Flexible Periods

- You can keep multiple years open at one time, with up to 13 periods active in the current and all past years. You can use quarters, months or four-week periods.

History

- History is maintained for an unlimited number of years. You decide when to remove the past years' history.

Post from other Red Wing Modules

- You can post to the General Ledger system from the other Windows Accounting Series modules, from Red Wing's popular Windows Payroll, and from Red Wing DOS systems.

1-6 Introduction to the General LedgerQuantities

- Track both primary and alternate quantities and units of measure.

Projects

- Enter project codes during transaction entry.

Error Recovery

- If your data files are damaged or become unusable, and your backup is not recent, the system lets you attempt to correct and recover damaged files.

Utilities

- Use these miscellaneous selections to recalculate account balances, zero account balances, summarize transactions and copy a sample chart of accounts.

Multiple Budgets

- You can continue using the current year budget while working on next year's. Budgets can be set up for all accounts based on prior budget or prior actual amounts. They can also be adjusted by a percentage of the prior values.

Queue Processing

- A queue lets you process reports while you are away from your computer. You can set up several queues, each with its own unique name. Set up queues to make sure you print all end-of-month reports.

Special Options

Special Options are handy add-on programs you can purchase to add even more power to your Red Wing Windows General Ledger. Special Options interface seamlessly with the General Ledger and are designed to meet unique needs.

Special Options include:

Change Posted Transactions Report Designer Change Account Numbers Change Account Structure Consolidated Statements ASCII Input Contact Red Wing Business Systems, Inc. at 1-800-732-9464 or e-mail sales@redwingsoftware.com for more information about Special Options.

Introduction to the General Ledger 1-7

How This User Guide is Organized

The General Ledger User Guide is divided into the following sections.

Chapter 1

Introduction - General Ledger features are listed, along with standards used in this manual. Also, a list of common toolbar buttons and keyboard commands provides a handy reference.

Chapter 2

Getting Started - Step-by-step procedures to follow when first setting up your General Ledger

Chapter 3

Practice System - Gives an easy introduction and tutorial on some of the more important features of the Windows General Ledger.

Chapter 4

Helpful Procedures - Frequently used procedures, as well as less frequent, but important procedures are explained in detail.

Chapters

5 through 14

Reference Guide - The General Ledger Menus are explained, detailing every menu selection.

Chapter 15

Basic Accounting Concepts - An introduction to double entry accounting covers basic accounting terms and using and understanding financial statements.

Appendix

Special helps, including a glossary.

Index

Search by topic for the information you need.

1-8 Introduction to the General Ledger

User Guide Formatting Standards

Notes and hints are identified by a push pin and are printed in italics. These are important messages and suggestions that can save you time and help you avoid potential problems. Extremely important information is printed in boldface type. Not reading this information or following the suggestions offered can lead to serious problems.

Getting Started 2-1

Chapter Two - Getting Started

This chapter gives you a step-by-step procedure to follow when first setting up your General Ledger.

Contents

How to Set Up the General Ledger ........................................... 2- 2 Before You Begin..................................................................... 2- 2 Defining IDs, Codes and Accounts........................................... 2- 3

1. Complete Setup in System Manager..................................... 2- 4

2. Set Up Customization........................................................... 2- 4

3. Set Up Accounts.................................................................. 2- 4

4. Optional Information............................................................. 2- 7

5. Set Up Financial Statements................................................ 2- 8

6. Make Opening Entries.......................................................... 2- 9

7. Budget and Forecast Balances............................................. 2-10

8. Set Up a Backup Schedule................................................... 2-10Topics

Covered

What steps to take before turning on your computer (page 2-2) How to format IDs, codes, and accounts (page 2-3) How to determine the account structure (page 2-4) How to use account classes and account types (page 2-5) How to use account segments for profit centers and other account divisions (page 2-6) Suggestions for setting up a chart of accounts (page 2-7)

How to use autosplits (page 2-8)

How to use recurring transactions (page 2-8)

Recommended procedure for entering beginning balances (page 2-9)

2-2 Getting Started

How to Set Up the General Ledger

Overview

Follow this procedure to set up your General Ledger, from planning the system to creating profit centers and accounts and making opening entries. The choices you make during setup determine how your General Ledger system operates. If you are unfamiliar with double entry accounting, see Accounting Concepts,

Chapter 15.

Before you

begin

1. What decisions do you make from your financial statements?

Write down the kinds of questions your financial statements should answer - for your banker, for the IRS, and for your own management purposes. Talk with your loan officer, accountant, or tax consultant to determine what kind of information they need from you. They may even give you sample financial statements.

2. Determine the number of profit centers

Write down the names and numbers of your profit center (enterprises) and departments or divisions (sub-accounts), if you use them. You can produce financial reports for each profit center you set up or you can run combined reports for all profit centers. Start with a minimum number of profit centers. You can easily add profit centers later.

3. Assign names and numbers to accounts

Use the information from step 1 to decide which accounts to include on the financial statement. Use your current Accounts List, Balance Sheet, and Income Statement or print an Account List from your sample data (Company = SAM) to use as an example. There are also Sample Charts of Accounts, for different types of businesses, included with the system, that can be selected when creating your data files.

Getting Started 2-3Balance Sheet

- Write down the major section names (example: Assets, Liabilities, Capital) and subsection names (example: Current Liabilities, Long-term Liabilities) you want included on the Balance Sheet. Write down your Balance Sheet account (and subaccounts, if you use them) names and numbers. This step takes the most time and effort.

Income Statement

- Write down the major section names (example: Income, Expense) and subsection names (example: Cost of Goods Sold, Operating Expenses) you want to include on the Income Statement. Write down your Income Statement account (and subaccounts, if you use them) names and numbers. A well-planned chart of accounts makes the General Ledger easy to use, requires little maintenance, and can be easily expanded as a business grows.

Defining IDs

and Codes and

Accounts

Before you begin assigning IDs, codes or accounts, decide on general naming conventions to make it easy for users to find them. Establish a format that makes sense for your business and use it consistently. A few suggestions are listed below: You cannot use the following characters in an ID, code or account: | " ' & # (reserved for system use) Use zeros to make all IDs the same length to prevent sorting problems. If they are divided into more than one part, the parts should be the same length in every ID. Also, do not use spaces to divide IDs into more than one part.quotesdbs_dbs19.pdfusesText_25

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