How do I set up a budget in Quickbooks 2010?

Question

I am treasurer for our school's PTO, and I use QuickBooks Premier Nonprofit Edition 2010.

I am trying to track budgets of two different types, and I can't figure out how to do it properly in Quickbooks.

The first type is simple: we decide how much money a committee can spend, and track expenditures. For example, our Family Fun Committee has $800 to spend each year, and they are not responsible for any fundraising.

I have an expense account called "PTO Expenditures:Family Fun". I have created a memorized report that displays all expenditures on that single account for the current school year. Right now, this report says that the Family Fun Committee has spent $543.69 so far, leaving them $256.31 to spend.

But how do I tell QuickBooks that this account has a budget of $800 for the fiscal year? I have wandered around the "Planning & Budgeting -> Set Up Budgets" menu item, but I can't see it.

The second type is more complicated. The budgets for some committees are set by their fundraising efforts. These committees have multiple QuickBooks accounts; for example, "Fundraising Income:5th Grade", "Fundraising Expense:5th Grade", and "PTO Expenditures:5th Grade". How do I combine these three accounts, and set a budget for the net?

Answer 1

One easy way to monitor costs in QuickBooks is to establish sub-bank accounts.

For example, you may have an asset account called "State Bank" numbered 11100 (asset, cash and cash equivalents, bank). Convert this to a parent account for a middle school by making subaccounts such as

• "Operations" 11110,
• "National & State Dues" 11120,
• "Family Fun Committee" 11130, and
• "5th Grade" 11140,
• "6th Grade" 11150, and = "7th Grade" 11160.

At budget formation, transfer $800 from Operations 11110 to Family Fun Committee 11130. Then write all checks for Family Fun from the Family Fun 11130 subaccount.

For fundraising, transfer $0 at budget formation to the X Grade accounts. Do deposit all grade-level receipts into the appropriate grade-level subaccounts and write all checks for the grades from the grade-level subaccounts.

The downside to the above is that reconciling the check book each month is slightly more complicated because you will be reconciling one monthly paper bank statement to multiple virtual subaccounts. Also, you must remember to never write a check from the parent "State Bank" 11100, and instead write the checks from the appropriate subaccounts.