To begin using the Accounting system in the Manage Module, there are a few items that must be set up first.
- Set up chart of accounts: Create at least one asset, expense, and income account.
- Set up automated deposit entries: Assign deposits to an asset and income account.
- Set up automated payment entries: Assign specific payment types that do not use deposit slips (e.g. cash payments, patient refunds) to an account.
Set up the Chart of Accounts
The chart of accounts is a list of the accounts used to organize finances and divide expenses, revenue, assets, liabilities and equity. If you are not familiar with setting up a chart of accounts, we recommend consulting your accountant. There are five types of accounts:
- Asset accounts: e.g. practice checking account, equipment, cash box
- Liability accounts: Loans
- Equity accounts: Owner/Practice Contributions/Capital, Retained Earnings
- Income accounts: For accounts receivable (e.g. sources of revenue such as patient or insurance payments)
- Expense accounts: For accounts payable (e.g. expenses such as supplies, utility bills, employee benefits, etc.)
To create or edit an account:
- In the Manage module, click Accounting.
- Click Add to create a new account, or select an existing account, then click Edit.
- Description: Enter the account name.
- Type: Select the type of account.
- Bank Number: The bank account number to represent this chart of account (typically only for Asset account types).
- Row Color: Set a color to make the row easier to spot in the Chart of Accounts grid. Click on the color box to select a color.
- Inactive: Mark this account inactive to hide it from the Chart of Accounts grid.
- Click OK to save.
Set up Automated Deposit Entries
When Deposits and Deposit Slips are created, an entry goes into an asset account (e.g. checking account) to balance your bank account. A second entry is made in an income account to keep track of the income total. To also create deposits in QuickBooks, see QuickBooks for set up instructions.
To assign the accounts for automatic deposit entries:
- In the Manage Module, click Accounting, then Setup. Open Dental should be selected as the Deposit Software.
- Automatic Deposit Entries: Select one or more asset account where deposits can be automatically deposited into. Click Add, then double-click an asset account. Added accounts will be options in the Deposit into Account dropdown on the Edit Deposit Slip window. The first one listed will be the default (typically a checking account).
- Income Account: Select the income account where deposits will be credited to track total income. Click Change, then double-click an income account.
Set up Automated Payment Entries
Some payment types that do not use deposit slips (e.g. cash payments or patient refunds) but still need an accounting entry, can be assigned to an asset and income account to create automate payment entries. Every time the payment time is used, an entry goes into an asset account (e.g. checking account) to balance your bank account and a second entry is made into an income account to keep track of the income total.
To assign accounts for automatic payment entries:
- In the Manage module, click Accounting, then Setup. Open Dental should be selected in the upper right as Deposit Software.
- Automated Payment Entries: Associate a payment type to an asset account. Click Add to open the Edit Auto Pay Entry window and select a payment type from the dropdown menu.
- Click Add, then double-click an asset account. Added accounts will be options in the Pay Into Account dropdown on the Payment Window.
- Click OK to save.
- Income Account: Select the income account where the payment types will be credited to track total income. Click Change, then double-click an income account.
If accounts for automatic payments are set up incorrectly, transactions may be attached to invalid accounts and you may receive an error when trying to view old payments. Follow the Accounting, Troubleshooting steps to identify and fix the transactions.