Using Estimates in QuickBooks
For certain customers or certain types of jobs, it may be advantageous to create estimates. A QuickBooks estimate looks very much like an invoice, and you fill out the fields in the same manner as you use for invoices. It’s important to understand that creating an estimate doesn’t impact your financial records. An estimate isn’t an invoice, but it can be the basis of an invoice (or multiple invoices if you choose to send invoices as the job progresses). In QuickBooks, when you create your first estimate, a nonposting account named Estimates is created in your chart of accounts. The amount of the estimate is recorded in this QuickBooks account, but nothing will show up on your Profit and Loss statement because an estimate isn’t a sale and will not affect your bottom line. To use estimates you must first enable the preference. To do that:
- Choose Edit | Preferences from the QuickBooks menu bar.
- Click the Jobs & Estimates icon on the left pane and then click the Company Preferences tab.
- In the Do You Create Estimates box, choose Yes.
- To have QuickBooks alert you if you attempt to use the same estimate number, click the Warn About Duplicate Estimate Numbers checkbox.
- Click OK to save your settings.