The Theory of Accounting Applied to Software

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The Theory of Accounting Applied to Software

• Justin Botillier, Torrey Jacobson,
• Mindy Konno, Maxine Vang, John Zoller

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Accounting Software Available

• Microsoft Dynamics
• Peachtree (Sage Accounting Software)
• QuickBooks
• Everest Software
• GnuCash
• Grisbi
• Dolphin Accounting Software

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• (formerly Microsoft Great Plains)

Project Accounting Software
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Software Benefits

• Financial management
• Instantaneous financial analysis
• Analytics
• Broad range of flexible, customizable analytics,
  reporting and budgeting options
• Business Portal
• Built on Microsoft .NET technology. Allows data
  and processes to be accessed from a Web-based
  portal

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Dynamics v. other packages

• Integration with widely-familiar applications
• Developed by Microsoft which means it is built to
  work seamlessly with their other products, such
  as Microsoft Office and Microsoft SQL Server
• Microsoft Office-like interface
• Pricing/Financing
• 5,000 to 500,000. Module type packaging lets a
  company create their own personal accounting
  package, eliminate expense on unwanted options
• Available from Microsoft Financing to reduce the
  burden of expensive IT changes
• Training
• Online e-courses
• Classroom training throughout the United States
  and Canada

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Dynamics v. MAS90
http//www.microsoft.com/dynamics/gp/product/mas9
0comparison.mspx
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Dynamics Demos

• http//www.microsoft.com/dynamics/gp/product/demos
  .mspx

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GnuCash

• Open source software (free)
• Runs on Macintosh, Windows, and Linux computers
• Keeps tract of bank accounts, stock options,
  income and expenses

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Grisbi

• Open source accounting software (free)
• Runs on Windows, Macintosh, Linux computers
• Provides basic accounting reporting/recording
  such as managing third party finances,
  expenditure and receipt categories

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Versions of Peachtree

• 1. Peachtree by Sage First Accounting
• Designed to support small service-
• oriented businesses
• 2. Peachtree by Sage Accounting
• Add basic inventory features to support
• retail establishments

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Versions of Peachtree Cont.

• 3. Peachtree by Sage Complete
• Provides networking and multi-user
  support, advanced inventory features, online
  banking, online bill paying, job costing, time
  and billing, an audit trail, and first-rate fixed
  asset management features.
• 4. Peachtree by Sage Premium Accounting
• Includes all the features found in
  Peachtree complete as well as departmental
  accounting, serialized inventory to assign serial
  numbers to them, company consolidation to roll up
  and summarize data, progress billing and employee
  compensation histories and report customization.
• Also comes in industry-specific versions
  for accountants, manufacturers and distributors.

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New Features of Peachtree Complete

• Now offers online banking a longtime QuickBooks
  feature
• Download and import transactions from your
  financial institution directly to Peachtree
• Bank list

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New Features Continued

• New online bill payment features
• New internal accounting review that removes
  suspicious transactions and accounting mistakes
  such as duplicate transactions

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Accounting Features

• The sales section in Peachtree, allows you to
  keep track of customers, sales, sales
  representatives and tax codes. You can also
  update your general ledger and sales journal as
  well as create an accounts receivable report.
• Accounts payable section, known as purchases,
  allows you to keep track of vendors and writing
  checks to making payment schedules

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Accounting Features

• Payroll lets you keep track of employee salary
  and how much your company owes to government.
• G/L (General Ledger) section keeps a log of all
  your transactions for 2 years. There are 13
  periods within each year.
• Inventory allows for adjustments as well as keep
  track of how much inventory your business has.
• Billing/Time keeps track of which customers are
  being billed as well as time cards.

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Accounting Features

• Analysis allow your to view how your business is
  doing as a whole. For example youll be able to
  see a payment aging report that allows you to see
  what percentage of credit sales are paid on time.
• The Company section holds miscellaneous features
  such as a tutorial on how to use Peachtree and an
  alarm system that notifies you of important
  events. It also has a Job Reports feature that
  allows you to create report by job lists,
  estimated job expenses etc.

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Peachtrees Strength

• Fast and smooth download (less than 15 minutes)
• Excellent tutorial that walks you through
  programs
• Offers some 145 customized reports
• Audit trail- allows you to record and report any
  changes made

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Peachtrees Weaknesses

• Expensive - constantly update the software
• Only runs on Windows (not flexible)

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Compared with QuickBooks

• Has the upper hand when it comes to inventory.
• Lets you track assemblies through
• manufacturing
• Create master and sub-assemblies
• Adjust prices by percentages
• Apply LIFO, FIFO Weighted Average
• and more

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Compared with QuickBooks Continued

• Manufacturing firms should highly consider using
  Peachtree
• Those in retail and service businesses that are
  happy with QuickBooks have little reason to
  switch because QuickBooks offers an excellent
  wholesale and retail-specific edition.

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QuickBooks
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Basic Information

• QuickBooks is an accounting software program
• Designed for small businesses
• Produced by Intuit
• An off-the-shelf accounting information system

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How is QB different from Quicken?

• Programs such as Quicken and Microsoft Money are
  designed to help with personal finances
• This often involves little more than bank account
  activity
• QuickBooks and Peachtree are business-oriented
• The program is set up around business transaction
  cycles

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Versions of Quickbooks

• Features offered vary depending on the version
  you have
• Main versions are
• Simple Start
• Pro
• Premier
• Enterprise Solutions

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Differences between versions

• Prices range from approximately 100 to 6000
  depending on the level of complexity desired
• Simpler versions provide help with tracking bills
  and day-to-day transactions
• More advanced versions offer payroll and
  inventory functions
• Mac versions are also available

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Using QB

• Operation of QuickBooks differs somewhat from
  textbook descriptions of accounting processes
• Use of QuickBooks is modeled around business
  processes rather than the nuts and bolts of the
  accounting cycle
• This feature may be helpful to users without a
  strong background in accounting

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BA 211/317

• Manual accounting cycle
• Journalize transaction
• Debit/Credit
• Post to G/L
• Trial balance
• Adjust
• Statements
• Closing

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Accounting QuickBooks Style

• Major business processes are grouped in the
  navigators
• To enter a transaction, go to the appropriate
  navigator
• Click on the necessary document
• QuickBooks generally handles debit/credit issues
• Sometimes, a prompt is needed

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Accounting QuickBooks Style

• Each document represents a complete entry or
  transaction
• Transactions are automatically journalized and
  posted
• Reports and financial statements are available at
  the click of a mouse

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Financial Statements

• With a manual system, financial statements are
  only available when the books are about to be
  closed
• With QuickBooks, the program will produce reports
  and statements at any time
• So no worries? Not quite

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Financial Statements

• Beware of GIGO effect
• Statements/reports may not be accurate if
  important information has not been entered
• The system will simply work with whatever numbers
  it has

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Drawbacks

• Forms and processes are largely fixed
• Inventory features are difficult to find and use
• Qualifier the program available to us is the
  2002 edition, so this may have changed in recent
  years

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Hands-On Features

• If necessary, journal entries can be made
  manually
• QuickBooks usually comes with a standardized
  chart of accounts
• However, the user can alter this chart as
  necessary to meet individual needs

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Overall

• Why accounting softwares are useful now compared
  to back then?
• How is it related to our learning in BA 378?
• Internal controls

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Questions?
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Bibliography

• http//www.users.bigpond.com/dunster1/Far20Side.h
  tm

http//www.smallbusinesscomputing.com/biztools/art
icle.php/3520081
http//accounting-software-review.toptenreviews.co
m/ peachtree-review.html
http//www.accountingsoftwareadvisor.com/peachtree
/index. shtml
http//www.peachtree.com/peachtreeaccountingline/c
omplete/
http//quickbooks.intuit.com/
http//www.microsoft.com/dynamics/gp/product/demos
.mspx