Unless you are using selected vendors as specific profit centers around which the income or expenses of your business revolves, you should delete all vendor names from your Expense and Income accounts. The problem with having these accounts labeled with vendor names is that frequently transactions are applied to both the "Vendor name" account and to the expense account reflecting the product or service which the vendor provides. Therefore, both accounts are inaccurate.

In the Chart of Accounts below, there are three vendor names set up as expense accounts: Kinko’s, AT&T, and Fedex.

If you QuickZoom into the "Kinko’s" expense account from a Profit and Loss report, or create a QuickReport from the Chart of Accounts, you will find that there are transactions applied to the "Kinko’s" expense account.

If you QuickZoom into the "Printing & Copies" expense account from a Profit and Loss report, or create a QuickReport from the Chart of Accounts, you will find a Kinko’s transaction there as well. Therefore, both accounts are inaccurate and incomplete.

The best thing to do would be to merge the accounts by changing the name "Kinko’s" to "Printing & Copies". (See page 22 for instructions on how to merge accounts.) All the "Kinko’s" transactions will then be grouped with the other "Printing & Copies" transactions, as you can see in this report. This will give you better insight into your overall "Printing & Copies" expense.

If you want to find out how much you have spent only with Kinko’s in the last fiscal year for example, you can do so by creating an "Expenses by Vendor Detail" report under "Profit & Loss" reports.

Procedure:

1) Click on "Reports" on your menu bar.

2) Click on "Company & Financials" on the drop-down list.

3) Click on "Expenses by Vendor Detail" on the pop-up list.

4) Click on "Modify Report"

5) On the Modify Report, click on "Filters" tab.

6) Click on "Date" in the box under "Choose Filter".

7) Click on the downward-pointing arrow to open the drop-down list of dates.

8) Click on "Last Fiscal Year".

9) Click on "Name" in the box under "Choose Filter".

10) Click on the downward-pointing arrow to open the drop-down list of Names.

11) Click on "Kinko’s" from the drop-down list of vendors or type "Kinko’s" directly into the "Name" field.

12) Click "OK". An "Expenses by Vendor Detail" report will be created with the total amount spent for last year.

In the case of the "Fedex" expense account, you could merge it with the account "Freight and Delivery" as explained on page 22.

In the case of the "AT&T" expense account, you could rename that account "Long distance" and recreate it as a subaccount of "Telephone".

Sometimes a credit-card vendor name such as "American Express" will appear on the Chart of Accounts as an expense. As explained on page 26, transactions in a credit-card expense account should be applied to a credit-card liability account. By removing vendor names from your income and expense accounts, you get better insight into which products or services your money is coming from or going to.