SETTING UP A NEW COMPANY

1.1. Peachtree accounting overview

Peachtree Accounting is one of the many types of off-the-shelve professional application software.
Peachtree accounting enables:
- To journalize and post transactions;
- To produce common accounting reports and financial statements;
- To set budgets and analyze actual accomplishments or variances;
- To create more than one company and operate simultaneously
 Peachtree accounting may be used in two cases:
 To start an accounting system afresh for newly established firm; or
 In case of converting a manual accounting system to computerized one for existing forms
To start the use of Peachtree accounting system, the first step should be to gather the necessary
information required to start the system.
These include information such as:
- Company data such as address;
- The type of accounting system to be used: cash basis or accrual basis;
- Beginning balances for balance sheet accounts;
1.2 Starting the Peachtree Program and the Peachtree Desktop
Starting the Peachtree Program
If Peachtree accounting is already installed into the computer, there are several ways to open
Peachtree.
(i) From the Taskbar
 Select Start on the taskbar and then Programs. Locate and select the Peachtree group folder.
Then select the Peachtree icon.
(ii) From My Computer
 Locate and double-click the My Computer icon on the Windows desktop. The My Computer
window appears. Then select the hard drive where you installed Peachtree. (Drive C is the
default.)
 By default, Peachtree is installed in c:\Program Files\Sage Software\Peachtree. Locate and
double-click the Peachtree folder.
 Next, locate and double-click the Peachw.exe file.
(iii) From the Desktop
 From the desktop, double-click the Peachtree icon.
The Start Screen
Once you start Peachtree, the Start Screen appears, giving you options for proceeding.

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The Peachtree Desktop
Once Peachtree is opened, you will see the Peachtree Desktop. From the desktop, you can move
around in Peachtree and perform your daily work. There are three methods of navigating available
from the desktop:

Menu Bar: The menu bar provides drop-down lists of options.

Navigation Bar: The Navigation Bar provides entry to the Navigation Centers. It also features a
group of Shortcuts, links to Peachtree functions that you use on a regular basis.
Navigation Centers: These provide useful, at-a-glance information about areas of Peachtree
such as Customers & Sales. They also let you access functions related to each of those areas—
for example, Sales/Invoicing.

The Menu Bar

At the top of the window is the menu bar. The table below gives a brief description of each menu.
File Allows you to perform several critical tasks such as opening or creating a company,
backing up or restoring a company, updating Payroll tax tables.
Edit Allows you to locate Peachtree transactions through the Find Transactions window.
Lists Allows you to open lists of records and tasks, such as customers and sales invoices. You
can print these lists and customize them as necessary.
Maintain Allows you to work with your record and list information. Here is where you go to add
or edit customers, vendors, employees, users, and so forth.
Tasks Allows you to perform all of your daily tasks in Peachtree, as well as carry out system

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 tasks like changing accounting periods.
Analysis Allows you to view customized graphical overviews of the entire company
to analyze cash flow, collections of amounts due from customers, payments due to
vendors, and financial status.
Options Allows you to set global preferences for a company and to change the system date.
Reports Allows you to queue lists of reports and forms for printing or viewing. You can also
& Forms create and edit the format for reports, forms, and financial statements.
Services Allows you to access and synchronize with various Peachtree Web resources online. You
can also check for Peachtree updates.
Window Lets you access open Peachtree windows and close all open windows.
Help Allows you to access Help, contact Peachtree support and a variety of other tasks.
Access a Menu Option Using the Keyboard
To access one of the Peachtree menu options, press and the underlined character. This is also
how you choose options inside windows or move to a field. Once a menu is displayed, press the
underlined character to select an option or use or to move up and down to select a menu
option.
Navigation Bar
The Navigation Bar is on the left side of the Peachtree Desktop. It
has a series of icons that represent individual Navigation Centers,
such as Customers & Sales. Click an icon, and you will see the
Navigation Center corresponding to it.

Shortcuts
The Navigation Bar also displays a number of Shortcuts, which are
links to Peachtree functions that you use on a regular basis. When
you first set up your company, Peachtree will offer default Shortcuts,
but you can customize them so you have quick access to the
functions you want.

To customize Shortcuts, click the Customize Shortcuts link. A

special dialog lets you choose the number and order of shortcuts that
appear on the Navigation Bar. To learn how, just follow Peachtree
Help for this dialog.

Navigation Centers
Each Navigation Center also provides a graphic representation of the flow of tasks related to that
area of Peachtree. The Customer & Sales Navigation Center, for example, has a “flow chart” of
customer-related tasks and offers access to those tasks.
Business Status Center
This feature displays a variety of general business information, including account balances, revenue
figures, receivables and payables data, and action items. It also includes a feature that lets you find,
display, and/or print a Peachtree report. What‟s more, you can customize the Business Status Center
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to have it look the way you want. Just click the Customize This Page button at the top of the
Peachtree Desktop.
The Company Navigation Center
This particular Navigation Center is the place to turn for access to a large number of tasks that help
you manage your company on a day-to-day basis. These tasks include setting up and maintaining
your chart of accounts, security and user access to your company, running the Year-End wizard to
close out a year in Peachtree, and backup and restore your company data.

Button Control Bar

Beside the Customize This Page button, other buttons in a bar at the top of the Peachtree Desktop
help you work with the Navigation Centers and perform other tasks related to Peachtree operation:

 Hide/Show: When the button reads Hide, click it if you want to hide the Navigation Center that
appears to the right of the Navigation Bar. When it reads Show, click it to make the Navigation
Center reappear.
 Refresh: Click this to update the company data that currently appears in the main Peachtree
window.
 Print: When the Business Status Center is displayed, click Print to print a facsimile of Business
Status as it currently appears; the printout will pretty closely approximate what you see on screen
right now.
 System Date: Click this to change the Peachtree system date.
 Accounting Period: Click this to change the current accounting period in Peachtree.
 Make this the default page/This is the default page: When it reads Make this the default
page, click it to make the Navigation Center that you are currently working with appear each
time you open a Peachtree company. When it reads This is the default page, the Navigation
Center you‟re working with is the current default and will appear each time you open a company.

1.3 Setting up your Company

The following items are usually requested while creating a company:
Company name and address,
Business type;
Accounting method: cash basis or accrual basis
Accounting periods and fiscal year
You can run create a New Company in two different situations:
 When you set up your first company in Peachtree
 When you set up an additional new company in Peachtree after working in another company
on the system
You can start Create a New Company from either the start up window or the Peachtree File menu:
➥ From the Peachtree Start up window, select Create a new company.
The Create a New Company - Introduction window appears.
OR
1) From the File menu, select New Company. If you‟re working in an existing company, you
will be asked if you want to keep the current company open.

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 2) Click Yes or No.
The next window lets you enter general information about your company.

1. Enter the company name, address, phone, and fax information.

2. From the list in the Business Type field, select your business type.
The business type defines the kind of business you run and determines the makeup of the Equity
section of your chart of accounts. You can change the business type at any time. You can choose
from the following:
❖ Corporation
❖ S Corporation
❖ Partnership
❖ Sole Proprietorship
❖ Limited Liability Company
3. Enter your Federal, State Employer ID, and State Unemployment ID.
4. Enter your company‟s Web site and e-mail address, if applicable.
Select a Method to Create your Company
On this window you will select a method for creating your company. Essentially, you are choosing a
general ledger chart of accounts. Your company‟s chart of accounts is a complete list of all account
names used in the General Ledger. Each account is associated with an account ID to help locate it
when recording data. Accounts are used to classify transactions for reporting purposes.

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 Using a Sample Business Type
Selecting this option will allow you to choose a sample business type from many that Peachtree has
on file. If you choose to use a sample business type, the next window will let you choose one of the
sample types for your company.

o Simplified Types
If you‟re setting up a retail, service, construction, manufacturing, or distribution company, you have
the option to set up your company using a simplified chart of accounts. The simplified chart of
accounts contains the basic accounts you need to get started.
o Detailed Types
If you‟re setting up another type of company, or if you want to use a more extensive chart of
accounts, you can select from other sample standardized charts of accounts.
 Copy Settings from an Existing Peachtree Accounting Company

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If you choose to use an existing Peachtree company as the basis for your new company‟s chart of
accounts, a second window will appear, letting you select the specific Peachtree Company you want
to use. Once you do, you‟ll see a third window that lets you select exactly those elements you want
to copy from the existing company. Later, you can modify these elements to suit your new company.
 Convert a Company
If you choose to convert a company, you will not make any other Chart of Accounts selections. You
will go directly to the window where you choose your accounting method.
 Build Your Own
Next, you‟ll see a window that lets you decide if you want to divide your account IDs into segments.
Account segmentation is a tool that allows you to formally segment your chart of accounts and to
filter reports based on selection of particular segments of the account ID. Using this feature, you
can quickly and easily produce and print departmental or divisional reports and financial
statements, or any other segment, such as location and so on.
 Consolidate Existing Peachtree Accounting Companies
A consolidated company is one that combines the charts of accounts of a number of existing
Peachtree companies to create a new consolidated chart of accounts. The new consolidated company
created in this way will let you see consolidated financial statements for a number of subsidiary
companies operating under an umbrella organization.
Accounting Method Window
This one‟s easy; you have only two choices: Accrual or Cash.
NB. Once you choose the accounting method and finish Create a New Company, you can’t change
the method used for this company. So be sure to choose the right one.
Posting Method Window
Posting: Posting is the process of updating the General Ledger's chart of accounts to reflect all
journal entries that have been entered into the system. Posting also updates all GL and other
accounting reports.
 In batch posting, the transactions entered will be saved to a temporary holding area without
being posted to ledger accounts immediately. This allows to review and verify the transactions
journalized before posting the batch to the general ledger accounts.
In batch posting, transactions are just saved; posting is a process you do separately as follows.
Post them to the General Ledger using Tasks System Post
 In real-time posting, the transactions you enter are both posted and saved when you click the
Save button.
NB. While you need to make a choice between posting methods whenever you create a new company,
you can always change this option at any time.
Accounting Periods Windows
A really important thing to think about is the starting date for converting to Peachtree. It must be a
date on which you know all your account balances, customer balances, vendor balances, and so on. If
possible, the start date should be the end of the previous fiscal year. If you want reports comparing
this year to last year, the starting date could be the end of the previous year.
A twelve-period fiscal year based on the calendar year is standard. But some companies start their
fiscal year with some month other than January and end it with some month other than December.

Finish Window
Congratulations! When you see this window, you‟re done. Just click the Finish button, and
Peachtree will create your new company. Of course, if you want to make any changes beforehand,

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 you can always click the Back button to return to the appropriate Create a New Company wizard
window.

1.4 Opening an existing company

Once a company is created, it may be opened in two ways:
i. Opening a company within Peachtree accounting windows
An already existing company may be opened from „File‟ menu as follows:
Click „open company‟ and if many companies exist, double click into the name of the company you
want to open.
ii. Opening a company from a startup screen
When Peachtree accounting program is opened up, a startup screen appears, and an already existing
company may be created from there by double clicking “open an existing company”
Again, if many companies exist being created into the Peachtree accounting program, choose the
specific company you want to open.
1.5 Changing Your Company Name and Other Basic Information
You can easily change your company name and other basic information at any time in Peachtree.
Entering a new name here does not mean you are entering a new company, it merely means you are
changing the name of an existing company.
1. From the Maintain menu, select Company Information.
2. Enter your changes to one or more of the fields. Company name is a required field; therefore it
cannot be blank.
3. If the type of business has changed, select the new type from the drop-down list.
4. If you want to change posting methods, click the arrow button and select.
5. When you have finished, select Ok.

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 2. Maintaining General Ledger Accounts
In order to maintain general ledger records, first chart of accounts should be maintained for the new
company created along with the respective beginning balances of the accounts (if any).
2.1. Maintaining Chart of Accounts
The Maintain Chart of Accounts window is used to;
• add a new account • delete an existing account
• define an account type • make an account inactive, and
• modify the description of an existing account • Change the account type for an account.

 From the Maintain menu, select Chart of Accounts.

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Account Types
Account types define how the account will be grouped in reports and financial statements. They also
control what happens during fiscal year-end. General Ledger accounts are assigned types on the
General tab of the Maintain Chart of Accounts window. Choose one of the following account types
from the drop-down list:
Accounts Payable
This represents balances owed to vendors for goods, supplies, and services purchased on an open
account. Accounts payable balances are used in accrual-based accounting, are generally due in 30 or
60 days, and do not bear interest.
 Select this account type if you are setting up open vendor accounts or credit card (purchase)
accounts.

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Accounts Receivable
This represents amounts owed by customers for items or services sold to them when cash is not
received at the time of sale. Typically, accounts receivable balances are recorded on sales invoices
that include terms of payment. Accounts receivable are used in accrual-based accounting.
 Select this account type if you are setting up accrued income that customers owe.
Accumulated Depreciation
This is a contra asset account to depreciable (fixed) assets such as buildings, machinery, and
equipment. Depreciable basis (expense) is the difference between an asset's cost and its estimated
salvage value. Recording depreciation is a way to indicate that assets have declined in service
potential. Accumulated depreciation represents total depreciation taken to date on the assets.
 Select this account type if you are setting up depreciation accounts for known fixed assets.
Cash
This represents deposits in banks available for current operations, plus cash on hand consisting of
currency, undeposited checks, drafts, and money orders.
 Select this account type if you are setting up bank checking accounts, petty cash accounts, money
market accounts, and certificates of deposit (CDs).
Cost of Sales
This represents the known cost to your business for items or services when sold to customers. Cost of
sales (also known as cost of goods sold) for inventory items is computed based on inventory costing
method (FIFO, LIFO, or Average Cost ).
 Select this account type if you are setting up cost-of-goods-sold accounts to be used when selling
inventory items.
Equity
Equity, also known as capital or net worth, are owners' (partners' or stockholders') claims against
assets they contributed to the business.
In Peachtree, there are three types of equity:
• Equity - Doesn't Close
• Equity - Gets Closed
• Equity - Retained Earnings
Equity - Doesn't Close
This represents equity that is carried forward from year to year (like common stock).
 Select this account type if you are a corporation and want to record common stock or other equity
intended as owner investment.
Equity - Gets Closed
This represents equity that is zeroed out at the end of the fiscal year, with their amounts moved to the
retained earnings account.
 Select this account type if your business is a proprietorship or partnership and you want to record
dividends paid to partners or if you are a corporation and want to record dividends paid to
stockholders.
Equity - Retained Earnings
• This represents the earned capital of the enterprise. Its balance is the cumulative, lifetime
earnings of the company that have not been distributed to owners.
• Retained Earnings is the key account. There can be only one Retained Earnings account in
Peachtree, but you must have one to roll each year's profit or loss into. Thus, Retained

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 Earnings, together with any Equity-doesn't close accounts, always shows the net worth of the
company prior to the current year.
Expenses
These represent the costs and liabilities incurred to produce revenues. The assets surrendered or
consumed when serving customers indicate company expenses. If income exceeds expenses, net
income results. If expenses exceed income, the business is said to be operating at a net loss.
 Select this account type if you are setting up accounts such as operation expense, supplies
expense, salary and wage expense, travel expense, or charity expense.
Fixed Assets
These represent property, plant, or equipment assets that are acquired for use in a business rather
than for resale. They are called fixed assets because they are to be used for long periods of time.
 Select this account type if you are setting up any of the following fixed assets:
• Land: property, storage space, or parking lots.
• Buildings: structures in which the business is carried out.
• Machinery: heavy equipment used to carry out business operations. For example, you may
want to set up any of the following: store equipment or fixtures, factory equipment of fixtures,
office equipment or fixtures (including computers and furniture), and delivery equipment
(including autos, trucks, and vans used primarily in making deliveries to customers).
Income
Income (also known as revenue) represents the inflow of assets resulting from the sale of products
and services to customers. If income exceeds expenses, net income results. If expenses exceed
income, the business is said to be operating at a net loss.
 Select this account type if you are setting up sales revenue accounts. It is common practice to
create different income accounts for each category of revenue that you want to track (for
example, retail income, service income, interest income, and so on).
Inventory
This represents the quantity (value) of goods on hand and available for sale at any given time.
Inventory is considered to be an asset that is purchased, manufactured (or assembled), and sold to
customers for revenue.
 Select this account type if you are setting up assets that are intended for resale. It is common
practice to create different accounts for each category of inventory that you want to track (for
example, retail inventory, raw materials inventory, work in progress inventory, finished goods
inventory, and so on).
Long Term Liabilities
This represents those debts that are not due for a relatively long period of time, usually more than
one year. Portions of long-term loans due and notes payable with maturity dates at least one year or
more beyond the current balance sheet date are considered to be long-term liabilities.
 Select this account type if you are setting up long-term liabilities (for example, long-term loans
and noncurrent notes payable).
Other Assets
This represents those assets that are considered nonworking capital (cash, accounts receivable and
inventory) and are not due for a relatively long period of time, usually more than one year. Notes
receivable with maturity dates at least one year or more beyond the current balance sheet date are
considered to be "noncurrent" assets.

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 Select this account type if you are setting up assets such as deposits, organization costs,
amortization expense, noncurrent notes receivable, and so on.
Other Current Assets
This represents those assets that are considered nonworking capital (cash, accounts receivable and
inventory) and are due within a short period of time, usually less than a year. Prepaid expenses,
employee advances, and notes receivable with maturity dates of less than one year of the current
balance sheet date are considered to be "current" assets.
 Select this account type if you are setting up assets such as prepaid expenses, employee
advances, current notes receivable, and so on.
Other Current Liabilities
This represents those debts that are due within a short period of time, usually less than a year. The
payment of these debts usually requires the use of current assets.
 Select this account type if you are setting up accrued expenses from a vendor, extended lines of
credit, short-term loans, sales tax payables, payroll tax payables, client escrow accounts,
suspense (clearing) accounts, and so on.
2.2 Entering Beginning Balances or Prior-Period Adjustments
In reality, prior-period adjustments are corrections to the beginning balance of retained earnings.
These adjustments result from an error in recording revenues or expenses for a previously closed
fiscal year. If you enter a new account, Peachtree assumes that this account has a zero balance.
 Select the Account Beginning Balances button on the Maintain Chart of Accounts window.
 Then, select the accounting period in which you want to enter or adjust balances, and click OK.
Click or tab to any of the white cells in the grid to change or add an amount.
NB; (The gray cells are disabled.) If necessary, you can enter a negative amount; just type a
minus sign before the number. Note that for each period, a running beginning balance is kept.
What If I’m Out of Balance?
If you are out of balance, a message will appear warning you that an equity account will be created
(or updated) to contain the difference or out-of-balance amount.
 This account will be named Beginning Balance Equity, and its type is Equity—Doesn’t Close.
This account does not appear in the Beginning Balances window, but it will appear in the list of
accounts and on financial statements and general ledger reports.
You should try to find the reason for the out-of-balance situation and correct it if possible. If you still
cannot find the error, you can select OK at the warning message. Then later, if you find the cause of
the out-of-balance situation, you can go back to the Beginning Balances or Prior Period Adjustments
window and correct the situation.

2.3 Adding and deleting an account

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Add an account for an established chart of accounts
1. From the Maintain menu, select Chart of Account… then enter an account ID and
description for the account
2. Select an account type from the drop-down list.
3. Select Save.
 You can add (set up) an account from most windows that are accessed from the Tasks
menu. Do this just by pressing Shift and + or double-clicking in the account ID field.
When the Maintain Chart of Accounts window displays, continue setting up the account.
Delete an account
1. From the Maintain menu, select Chart of Account…then enter or select the account ID you want
to remove. To display a list of existing accounts, click list on the maintain chart of accounts
toolbar, or select the Lookup button. Then,
2. Select the Delete toolbar button to remove the account.
NB: In order to delete an account there must be no transactions posted to the general ledger that
references the account ID. If an account has a nonzero balance, you must delete or remove
transactions associated with it first. These can include beginning-balance entries.
2.4 Using Reports to Make Decisions
Being able to see how your business is doing--who owes you money, who you need to pay, what
items need reordering, and so on--is integral to running your business. Peachtree includes a wide
variety of standard reports that show you what you need to know about your business to make key
business decisions and keep the cash flowing properly.
 To open the reports for an area of Peachtree, select Reports & Forms from the menu bar, and
then select the area of the program you want to see a list of reports for.

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You can modify these reports to suit your needs. For instance, you can change the “filters” that are
used. Depending on the report, the fields or data that you can filter will vary. For the Aged
Receivables report, you can change the date range and select from values for several fields, such as
Customer Name, Customer Type, and Aging Category.
 To change the filters, select Options on the toolbar of the Select a Report or Form window.
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You can also change which columns of data appear on each report. If certain columns that appear on
a report are not pertinent for your company, you can choose to remove them from the report. In
addition, you can add columns for information that is not normally shown on the report.
 To change the columns of information that show on a report, select Columns on the toolbar of
the Select a Report or Form window.

You can also save these changes to filtering and columns by clicking Save in the toolbar. Simply,
give the report a new name and new description and you‟re done!

2.5 Backup and restore

Backing up Company Data
Backup: refers to a duplicate softcopy of a data into the hard disk, diskette, or other data storage
device. Every record made into a company should be backed up as frequently as possible
➥ Select File, Back Up. This will open the Back Up Company window.

On the next window, specify the name of the backup file and the location of the file. What you name
your file depends on you, but if you work with multiple companies, you should include the name of
the company in the file name. Otherwise, you run the risk of overwriting one company with data
from another company data should you ever restore that backup. Also, It is recommend that the file
name include the date the backup was made so that you can quickly determine if it is the one you
want.

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Next, Peachtree will notify you of the amount of data space the backup will take or the number of
disks it will need. Click OK to complete the process.

The amount of time it takes to complete the backup depends on the size of the backup and the
medium to which you are backing it up.
Restoring Company Data
Restoring: involves retrieving information that was saved or backed up in a given storage means.
Thus, restoring a company replaces all information in the open company with the entire backed up or
saved information in a given storage means.
Therefore, when company data are lost for various reasons or working computers are changed, a data
backed up in a given storage means may be restored back to the hard disk after opening up the given
company restoration of data is to be made.
NB. When you do restore a backup, bear in mind that Peachtree restores ALL files, overwriting ALL
existing data. You cannot restore individual files since the files are all interrelated. It is recommend
that you back up existing data before overwriting it with a backup from a previous point in time.
To restore a backup
➥ Select File, Restore. This will open the Restore Wizard.

 Click the Browse button and locate your Peachtree backup. These files are identified with the
extension: .ptb.
 Once you have selected the file, click Next to continue.
On the next window, you can verify that the correct backup has been selected.

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 Ensure that An Existing Company is Click Next to continue
checked, and verify that the correct
company and location are displayed.
On the Restore Wizard - Restore Options window, select the types of data you want to restore and
click Next.

Finally, click Finish on the Confirmation window. The length of time it takes to restore depends on
the size of the backup and the type of medium on which it was stored.

3. Maintain subsidiary ledgers

3.1 Setting up Customers ledger
Customers are the people whom you sell your products and services to. You can set up both default
and specific customer information.
Setting Up Sales Taxes

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Before you can bill your customers, you will want to set up your sales taxes. Once these are set up,
you can make a particular sales tax part of each customer‟s record and automatically call up the
correct sales tax when you create orders, bills, and so forth, for that customer.
➥ To create your Sales Taxes, Select Maintain, Sales Taxes. This will open the Sales Tax Wizard.
Select Set up a new sales tax and click Next.

Enter the number of agencies or individual rates Enter the total percent of the sales tax. For
that make up this tax. For instance, if this tax is instance, if this sales tax is made up of a state
made up of a state tax and a county tax, enter 2 tax of 4% and a county tax of 2%, enter 6 in
in this field. this field. If the tax is based on a formula, leave
the field blank.

Click Next and enter Sales Tax Agency information:

When you are done creating agencies, you will create the tax. Enter the appropriate information on
the Sales Tax Entered window.

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Incidentally, inventory-item tax types do not affect the sales tax rate. They affect only if an item is
taxable or is exempt from sales taxes. Inventory-item tax types are set up in the Inventory Item
Defaults window
Customer Maintenance
Once you‟ve set up your customer defaults, some of that information will help streamline the process
of adding customers to the database.
➥To open this window, Select Maintain, then Customers/Prospects. You can see on the
opened window in the next page.
Header Fields
In the header you define the customer ID, customer name, and the status of the customer. Note that
the customer ID is not case sensitive and must be unique for each customer.

Entering Customer Beginning Balances

Unless you are starting up your business for the first time when you set up Peachtree, you will have
balances for existing customers, outstanding invoices that must be entered so that they can be paid
and so that your reports will be accurate. These outstanding balances are entered as beginning
balance invoices.
To enter beginning balances,
1) Select Maintain, Customers/Prospects.
2) Click the Beginning Balances button on the History tab.

NB. The Customer Balances tab will show you a list of your customers and their current balances.
These balances will be 0.00 if you have not entered any customer invoices yet. Otherwise, you will
see current balances.

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You can select a customer from the list on the Customer Balances tab by clicking it. Once the
customer is selected, click the Invoices for tab to enter any beginning balances.

Fill in the fields with information from your For accrual-based companies, the A/R
outstanding customer balances. When you are Account field is used so Peachtree
done with one customer, select the next knows which account to decrease when
customer from the Customer Balances tab. you receive payment.

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 Be sure that the total amount of your customer beginning balances is equal to the amount you
entered as a beginning balance in your chart of accounts for your A/R account(s). This ensures
that your Aged Receivables report will balance with your general ledger.
 You can adjust these beginning balance entries at any time unless customer receipts (payments)
have been applied to an invoice. In that case, the invoice will be grayed out, and you must delete
the customer receipt before you can adjust the beginning balance entry.

3.2 Setting Up Vendors ledger

Vendors are your suppliers, the people who sell you the products and services that your business
deals in. You can set up both default and specific vendor information.

Vendor Maintenance
The Maintain Vendors window stores information about the businesses you purchase goods and
services from. It‟s also where you set up government agencies you pay taxes to. Once you‟ve set up
vendor defaults, you can use some of the information there to help streamline the process of adding
vendor records.
➥To open the Maintain Vendors window from the Maintain menu, select Vendors.
Header Fields
In the header you define the vendor ID, vendor name, and the status of the vendor. The vendor ID is
really a code or shorthand for the vendor name and can have up to 20 alphanumeric characters; it
must be unique to each vendor. Lists and reports sort on vendor IDs, so the code you use is
important.
Note that numeric characters sort before alpha characters. Note as well that the vendor ID is not case
sensitive, so jim is the same as JIM to Peachtree.

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General Tab
Here, you can enter a contact name and vendor mailing address information. To save you time
typing, there‟s also a Copy button that lets you easily copy mailing address information to the remit-
to address 1 for a vendor. Besides name and addresses, on the General tab you can also specify a
custom vendor type.
 Vendor Type lets you classify your vendors however you want. For example, you might use
SUPPLY or SERVICE as your different vendor types. The field is case sensitive; that is, Supply
and SUPPLY are treated as two different words.
Addresses Tab
For each vendor you can set up multiple addresses, as well as choose which address—mailing or one
of the remit-to addresses—will serve as default address for shipments, purchase orders, and
payments. To set up the default addresses, enter the various addresses for this vendor.
History Tab
This shows additional information about the selected vendor, including how long the vendor has
served your company, as well as invoice and payment dates and amounts. When entering a new

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vendor record, you can edit the information on the History tab. Once you save the vendor record,
however, you can‟t edit the data.
Purchase Info Tab
You may enter the vendor‟s tax ID number (if you send the vendor 1099 forms). On the Purchases
Info tab, you also set up a purchase rep, one of your employees who‟ll act as chief buyer for this
particular vendor. If you want to set up different ones for this vendor, select Customize terms for
this vendor; you can do the same for any of your vendors.

To change payment terms for the current vendor, select Customize terms for this vendor, and then
enter the new terms.
Finally, you set Form Delivery Options for the vendor. These options let you choose either paper or
e-mail as the default method of form delivery to the vendor whenever you print a batch of forms.
However, even if you choose e-mail as a vendor‟s default delivery method, Peachtree still lets you
give the vendor paper copies whenever you e-mail or print forms in a batch.
Entering Vendor Beginning Balances
Vendor beginning balances are essentially unpaid purchase invoices (bills) you have received from
vendors prior to the first transaction date in Peachtree. For example, let‟s say that your first fiscal
year with Peachtree begins July 1. In this case, you can enter beginning balance invoices with dates
June 30 or earlier.
To enter vendor beginning balances,
 Select Maintain, Vendors.
 Click the Vendor Beginning Balances button on the History tab.
You can select a vendor from the list on the Vendor Balances tab by clicking it. Once the vendor is
selected, click the Invoices for tab to enter any beginning balances.
The Vendor Balances tab will show you a list of your vendors and their current balances.
NB. These balances will be 0.00 if you have not entered any vendor bills yet. Otherwise, you will
see current balances.

Fill in the fields with information from For accrual-based companies, the A/P
your outstanding vendor balances. When Account field is used so Peachtree

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 you are done with one vendor, select the knows which account to decrease when
next vendor from the Vendor Balances you enter payments.
tab.

The beginning balance amounts should not include any vendor bills entered in Purchases/Receive
Inventory. Be sure that the total amount of your vendor beginning balances is equal to the amount
you entered as a beginning balance in your chart of accounts for your accounts payable account(s).
This ensures that your Aged Payables report will balance with your general ledger.
NB. You can adjust these beginning balance entries at any time unless payments have been
applied to a vendor invoice. In that case, the invoice will be grayed out, and you must delete the
vendor payment before you can adjust the beginning balance entry.

4.3 Setting Up Inventory ledger

Different types of businesses buy and sell different types of things that can be managed as inventory.
Retail businesses, such as clothing stores, maintain stock items that are purchased and sold, and
whose cost and quantity are tracked. Service-oriented businesses, such as day care centers, sell
services that have fixed costs and prices, such as fees per hour or per day. These types of businesses
don‟t sell merchandise; instead, they sell services. Professional businesses like consulting and law
firms track employees‟ time and expenses as they carry out projects and then bill their customers
based on the time and expense accrued. Peachtree‟s inventory management system can manage a
wide variety of different “classes” of items, so that it meets the needs of a wide variety of businesses.

Inventory Item Maintenance

The Maintain Inventory Items window stores information about the items you buy, sell, and track.
Once defaults are set up, many of the fields will be filled automatically when you select the Item
Class. Also, the tabs and fields available will vary depending on the Item Class you choose.
 To enter an inventory item in Peachtree, select Maintain from the menu bar and then Inventory
Items.

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Depending on your type of business, you‟ll need different Item Classes. A few samples are below:
 Retail business: A retail business that buys and sells inventory will use Stock Items. These are
items that can be bought or sold and whose cost and quantity-on-hand are tracked. Peachtree
keeps track of the cost of these items as you purchase them. If you are maintaining a stock of
actual items, it is recommended that you enter these items first. You can always enter other items
or services later.
 Service business: A service business will mostly use Service items. These are items that can be
sold but have a fixed cost, entered by you. Some service businesses will also use Stock items
because they also sell merchandise. A beauty salon, for instance, sells various services but sells
supplies as well.
 Consulting firm or professional business: Many businesses find it useful to treat a service as an
item similar to inventory. Doing this makes it easier to assign prices to your services and list
them on invoices for your customer. These types of businesses, that track time and expenses and
bill on this basis, will use Activity and Charge items.
 Activity items are different types of time, phone calls, meetings, etc., that is spent on projects;
and Charge items are different types of expenses incurred during the course of performing a
project.

Once the item has been created using Maintain Inventory, you can select it. Peachtree will
automatically display the Description and Unit Price of the item.

Header Fields

Here, you define the Item ID, a unique identifier for the item. The Item ID is not case sensitive, so

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HOUSE and house are treated as the same ID. Also, you enter a short description and choose the
Item Class. On the header, you can also indicate if the item is subject to commission when it is sold.
The Sales Rep Report will track the items when they are sold, and you can use the figures on that
report to help you calculate commissions for your sales people.
General
A great deal of important information for each item is stored on this tab, with many of the fields
filled automatically from defaults.

Custom Fields
Here you can enter information for the field labels you created in Inventory Defaults. This
information can display on some reports.
History
This tab will track the sales and purchase history of the item, broken down by accounting period.
Inventory Beginning Balances
When you first set up Peachtree, you will want to enter the quantities of your inventory items that are
currently on hand when you started using Peachtree. This will ensure that your inventory is valued
correctly. To enter your beginning quantities and costs
➥ Click the Beginning Balances button on the Maintain Inventory Items window; then, follow the
steps below.

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Set Up and Maintain Price Levels
You can change individual item prices on the Maintain Inventory Items window or you can change
prices for multiple items at one time using the Maintain Item Prices feature. This method is more
convenient if you are changing prices on a range of inventory items or all inventory items. For
example, if you want to mark up all of your inventory items by 10%, use the multiple items method.

4. Recording transactions
4.1 Customer Transactions or Selling Goods and Services
We‟ll begin where all business begins--selling goods and services to your customers. Customers can
be individuals or other businesses who pay you money. In accounting and in Peachtree, tasks and
reports that pertain to customers are categorized as Accounts Receivable (AR). Accounts
Receivable includes business tools such as Quotes, Sales Orders, Invoices, Receipts, and Deposits
for banking purposes.
Creating a Sales Order

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A Sales Order tracks the items that a customer has ordered from your company. Usually, you use a
sales order if there is going to be a delay between the time a customer orders the goods or services
and the time you actually deliver them.
 To enter a Sales Order in Peachtree, use the menu bar to select Tasks, Quotes/Sales
Orders/Proposals, and Sales Orders.

NB; Sales orders are optional. If your business sells items over the counter or you ship items and
create a bill for the customer (an invoice) immediately, you may not need to use sales orders.
Billing Your Customers
In most businesses, customers pay for products and services only after they receive them. To notify
them that their goods have been shipped and that they owe you money, a bill, or invoice, is created
and sent, sometimes with the goods or sometimes separately.
Sales Invoices show the goods that were shipped and how much the customer is being billed for
them. They are usually used for customers who are given a certain number of days to pay, that is,
customers who buy on credit.
Invoices show the customer name, shipping address, invoice number, payment terms, and items that
were shipped, including a total and any sales tax. Businesses that sell services rather than goods can
create and use “Service” type inventory items on Sales Invoices. Peachtree also has a library of
service business forms, such as a service invoice form, that you can use to print your invoices just the
way you want.
 To enter a Sales Invoice in Peachtree, select Tasks from the menu bar, and then Sales Invoicing.
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Receiving Money
Receiving money into your business is what it‟s all about. Without funds coming in, you can‟t pay
your employees, pay your bills, or purchase supplies. Peachtree helps you to record payments from
your customers and create bank deposit slips. In Peachtree, these customer payments are called
Receipts. Receipts are records that track any sorts of money received from customers.
 To enter a Receipt in Peachtree, select Tasks from the menu bar, and then Receipts.
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Entering Customer Credit Memos
On occasion, you will have to grant a customer credit—an item arrived damaged, and they returned
items to you.
➥To enter a credit memo and apply it immediately to an invoice, Select Tasks, Credit Memos;
then, follow the steps below:

1. Select a customer. Peachtree 5. Click Save or Print to 2. Enter the Credit ID

will fill in the header fields complete the transactions and you‟ve assigned to this
with information from the apply the credit. credit memo. If you‟re
customer‟s record. going to print the credit,
leave the field blank.

3. Enter the quantity returned in the field. Peachtree 4. Click the drop-down on the tab and select the
will calculate the amount of the credit. invoice that you want to apply the credit to.

5.2. Vendor Transactions or Purchasing Goods and Services

Every business needs to make purchases and spend money, whether it is buying items for inventory,
purchasing equipment and supplies for internal use, or just paying utility bills and taxes. These
purchases are made from other businesses and individuals who are called vendors in Peachtree. Each
vendor has its own record that tracks addresses, phone numbers, payment terms, and so on. In
accounting and in Peachtree, tasks and reports that pertain to vendors are categorized as “Accounts
Payable.” Accounts Payable (AP) includes business tools such as Purchase Orders,
Purchase/Receive Inventory, and Payments.

Entering a Purchase Order

Purchase Orders are a way to track items that have been ordered from vendors. They include the
vendor name and address, date, a unique number, payment terms, and a list of the items being
ordered. Often, they are used for larger purchases (over $2,500, for instance) and for controlling a

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budget. Also, they can protect both the purchaser and the vendor in the case of a dispute over price or
items shipped. In many businesses, only certain individuals are authorized to issue purchase orders
and they must initial or sign an order before it is sent out.
 To enter a Purchase Order in Peachtree, select Tasks from the menu bar, and Purchase Orders. 

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Entering a Bill (Purchase Invoice)
When businesses want money for the goods and services they sell you, they‟ll send you a bill (invoice). This
invoice could be for items on Purchase Orders or other types of bills, such as utility bills. In Peachtree, bills
from vendors and receipt of inventory are recorded in Purchases/Receive Inventory.
The bill will show what items were received, how much they cost, and the total amount that the company now
owes the vendor. The Purchase Invoice is usually used for items bought on credit or for services that allow the
company some time to pay, for instance, utility bills.
 To enter a Bill in Peachtree, select Tasks from the menu bar, and Purchases/ Receive Inventory. 
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If this purchase invoice records items received from a If any of this bill was paid for
Purchase Order, use the Apply to Purchase Order # tab. In at the time of purchase, you
this way, Peachtree knows how much of a Purchase order has can enter it here.

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been filled. Plus, you can compare the actual quantities and
prices against what you ordered.
After the bill from the customer has been entered, the items will be available for sale and the amount
of accounts payable will be updated. The Accounts Payable clerk or department can see how much
money the company owes using the Aged Payables or Cash Requirements report.
Making a Payment
In Peachtree, payments you make to vendors are recorded using Payments. A Payment is any
amount of money sent to a vendor for goods or services purchased. It could be made in cash, by
check, or with a credit card. Or to cut a check, the clerk will use Payments.
 To enter a Payment in Peachtree, select Tasks from the menu bar, and then Payments. 
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If an invoice is being paid, use the Apply to If you are paying any other type of bill, for
Invoices tab and specify the invoices being paid. instance, a utility bill or another bill that did
Early-payment discounts are tracked and calculated. not have an invoice associated with it, use
the Apply to Expenses tab. You can also
enter deposits sent to vendors here.

Entering Vendor Credit Memos

You use the Vendor Credit Memo window to enter credit memos for returns to and credits from a
vendor.
➥ From the Tasks menu, select Vendor Credit Memos.

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1. Select a vendor. Peachtree 5. Click Save to complete the 2. Enter the Credit ID you
will fill in the header fields transaction and apply the want to assign to the
with information from the credit.. credit/return.
vendor‟s record

3. Enter the quantity returned in the field. Peachtree 4. Click the drop-down on the tab and select the
will calculate the amount of the credit. invoice that you want to apply the
credit/return to.

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