Adjust balances on bills

[Jazz South]

I am a newby and have inherited the job of keeping books for 3 entities. Not sure if my Premier Non Profit 2007 program should even be doing all of this but here goes.

Previous bookkeeper set up books in that program as follows:

A: Non profit company
B: For Profit company
C: Personal Family Books company

All of these are set up correctly as separate "company files". This part seems to work fine. Most of the purchases and deposits are properly separated and reconcile with the bank statements. She often however, didn't put things in the correct "drawer" (chart of accounts) within each company. ex: a check for electric recorded one time under utilities expense and another under Electric Power Board expense sometimes as a payment to a bill other times just as a check. She created new "drawers" (accounts) when she was stumped.

Question 1
When should a transaction be set up as a bill and payment paid against it and when should it just be a check? How does this effect the reporting and resulting balance recording?

Question 2
The Family Company had a bankruptcy and all of the credit card bills are no longer owed. How do I change the balances to reflect the $0 amount now owed since some of the original bills have payments deducted from them.

The cards also have items charged on them that need to continue to be shown as as expenses. ex: Used the Target card to buy clothing item for $10. Item is recorded in credit card ticket area in the clothing account "drawer" for $10. A minum payment is then made to Target for for $2. Target card balance shows as $8. Since Target Credit Card account was written off in the bankruptcy. How do I adjust the bill or the existing balance on the books? Additionally the transactions occured at a time in the past that has already been reconciled in the check book.

Question 3
How do I adjust non credit card related bills that were created which are no longer owed but have some payment transactions paid to them by checks. ex: $100 electric bill was partially paid by check from the Family for $75. Another entity (help from a church) paid the remaining $25. Balance of electric bill still shows $25 owed.

I'm not a trained accountant so I'm not familar with journal entries, etc. I understand the idea of debits and credits generally but not how transactions are related in the background of the program, consequently I would appreciate simple step by step advice.

I'm sure I'll have lots more questions and I hope I'm in the right forum for expert advice. I don't want to make more problems than I fix.

Thanks in advance from someone who truly appreciates the help.

[Joe Williams]

Question 1. It does not make any difference to QB whether the expense is from a bill or check. Only that the bill must use Pay bills to show it paid.
Question 2. Create a new EQUITY account named "Bankruptcy".
If the original charges were entered as a Credit Card Charge, then enter a Credit Card charge with the Credit selected for that card's balance and set the account to "Bankruptcy".
If the original charges were entered as a Bill, then enter a Bill and choose Credit and that Customer's balance and set the account to "Bankruptcy" and use Pay Bill to apply the credit to the outstanding bills.
Question 3. "How do I adjust non credit card related bills that were created which are no longer owed but have some payment transactions paid to them by checks. ex: $100 electric bill was partially paid by check from the Family for $75. Another entity (help from a church) paid the remaining $25. Balance of electric bill still shows $25 owed."
Create two Credit Card Charges (choose Credit) with the "Purchased From" for Family and one for Church with the account set to "Bankruptcy"

[RobJoy]

The only thing I'd add to Joe's answer is this: try to stick to using either bills-and-payments or checks for any one vendor. Having a mixture against a vendor easily leads to confusion. Generally you can use just Checks for 'cash' purchases - retail shops, internet purchases etc., where you have to pay immediately. Bills and bill payments make sense when you get a bill then have to pay it later - like the electricity bill.

[Jazz South]

I appreciate the great info and the quick reply. This all makes sense and I'll let you know how it goes.
Blessings,
Jazz South