Q: Hi Gita! What a wealth of information you offer on Real Estate QuickBooks Property Management!!

I have one question regarding Property Management. I’ve been creating invoices for rent, but I’m finding it is not the ideal solution. When someone does not pay, it of course still shows the rent amount as income to the owner as the invoice has been posted. The only way to know that the rent has not been paid yet is to look at the open invoices report. This to me is not foolproof.  I need to devise a foolproof way of setting this up. I do like the idea of creating invoices, because I want to be able to see at glance who has paid and who has not paid, but like I said, I do not want the rental income to show before funds are actually received. If I go to preferences and change it to cash method instead of accrual, will this do the trick?

A: Kudos to you. You have already taken the first step to tracking money owed to you. Managing your receivables (tenant who owes you money) will reduce your liabilities and retain more clients, which in your case is property owners. You are already on your way to increase your revenue and be at your A game.

Here is what you are currently doing, entering invoices for each tenant but you cannot view reports accurately. Few clicks would do the trick for you.

Here are some simple steps:

Edit the Preference: Click on Edit > Preferences > Reports & Graphs > change the Summary Reports: Basis to Cash

• When you do that all the reports that were prepopulated by QuickBooks should be on cash basis with some exceptions.
• If they do not change all you have to do is close your QuickBooks and reopen the file.

Memorize Reports – These reports will not reflect the change you make from Accrual to Cash basis and vice versa.

• Solution: You will have to open each report and Modify or Customize Report:
• Change the Report Basis to Cash basis

• Click OK
• Click on Memorize and Replace to save your changes

Open Invoice report will still be on Accrual basis immaterial if you change the Preference. Let me know if the above changes reflected on your reports.