welcome to the fit small business
quickbooks online training course in
this lesson we're going to cover how to
run an accounts receivable aging report
in quickbooks online to follow along
with me login to your quickbooks online
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our full QuickBooks Online course and
other helpful resources let's get
started the AR aging report provides a
list of all of the unpaid customer
invoices and the number of days they
have been outstanding in order for this
report to be useful you must set invoice
terms for all of your customers if you
have not set up invoice terms in the
customer profile then QuickBooks will
not be able to provide you with reminder
when your customers and voices are
coming due in addition the AR aging
report will not be able to track the
number of days the invoices have been
outstanding there are a couple of ways
to set up invoice terms the simplest
option is to set up default invoice
terms for all customers this option
works best if the majority of the
customers have the same invoice terms
for example net 30 and the how to set up
invoices sales receipts an estimates
lesson we walk you through step by step
how to set this up click here to watch
this video tutorial if you offer
different terms to many of your
customers then click here to watch our
how to set up customers tutorial the AR
aging report can help you to stay on top
of customer invoices that are past due
so that you can follow up with your
customers about payment the longer an
invoice remains past you the higher the
likelihood that you may not get paid
without some type of follow up with your
customers not getting paid can impact
your business's cash flow so it's
important to keep on top of your unpaid
invoices using an AR aging report to
help demonstrate the components of the
AR aging report we will take a look at
the eight our aging report for a
fictitious company Paul's plumbing here
you will find the AR aging summary
report as of September 30 of 2016 for
Paul's plumbing similar to the balance
sheet report this report is as of a
specific date click here to watch our
video tutorial on how to run a balance
sheet report
box number two shows the aging
categories this report is organized by
customer and then by five different
aging buckets starting with current one
to 30 days 31 to 60 days 61 to 90 days
and 91 and over the current column
indicates invoices that are not yet due
no action is required for invoices that
appear in this column the 1 to 30 day
column indicates invoices that are 1 to
30 days past due certainly you don't
want to contact a customer who is just a
couple of days past due however for any
invoices that are 7 days past due I
would recommend that you send the
customer a friendly reminder either by
telephone or email if you send an email
I would include a copy of the invoice as
well the 31 to 60 day column indicates
invoices that are 31 to 60 days past due
by this point you should have sent at
least one or more reminders to your
customer to pay their outstanding
balance if you still have not received a
response then I suggest that you send
them a letter on letterhead that
includes a verb it's similar to in order
to avoid any additional late fees or
penalties please remit payment
immediately the 61 to 90 day column
indicates invoices that are 61 to 90
days overdue
unless you have spoken with your
customer and provided them with
additional time to pay their outstanding
balance more than likely you will not be
getting paid at this point you may want
to look into sending this to a
collection agency or possibly writing it
off as bad debt the 91 and over day
column indicates invoices that are 91
days past deal similar to what I
mentioned for anything in the 61 to 90
day column you should likely be sending
this to a collection agency or writing
it off as bad debt expense at the bottom
in box three shows the totals by each
group or category a good rule of thumb
is to make sure that the majority of
your outstanding receivables is within
the first three columns it should be a
rare occasion that you have something
creeping to the 61 in over categories if
you do be sure to address it quickly you
can run an eight-hour aging report
pretty quickly
in QuickBooks so let's go ahead and
navigate that now on the left hand menu
bar you want to click reports and then
once you do that make sure you're on the
recommended tab and your AR aging
summary report will be right here go
ahead and click on that
from this screen we have several options
starting with the reporting period you
can select the report period that you
would like to run the report for from
the drop down here so you can select any
of these periods or you can actually
type the date into this field this show
non zero or active only option here
allows you to show only active customers
all customers or customers that have a
balance other than zero and same with
the columns you've got those same exact
choices here days per aging period so
currently our categories have 30 days
within each bucket so one two thirty
thirty one is sixty sixty one and ninety
etcetera so you have the option to
change that to whatever you like best
practice typically is 30 days and then
you also have the option to control the
number of periods that you have and so
again we've got the four periods here
one to thirty thirty one is sixty sixty
one to ninety ninety one and over and
you can change that to whatever your
preference is for your business after
you make your selections you can run the
report and it will appear down here
below you have the option to email the
report so for example if you need to
send it to a CPA or tax professional you
can do that you have the option to print
the report from this icon here and then
you also have the option to download the
report into an Excel format or a PDF
format in order to get the invoice
details for the summary report you want
to go ahead and click on any of the
numbers within the report and notice
that there will be a hyperlink once you
click on that hyperlink you can see the
details of what makes up the customer
balance so for this particular customer
they have one outstanding invoice that
makes up the outs
any balance of six twenty nine ten by
now you have a good idea of how the
eight are aging summary report can help
you to stay on top of unpaid invoices so
that you can get paid from your
customers in a timely manner here are a
few things that you should implement as
soon as possible first be sure you
create an invoice for all credit sales
as they occur make sure that you set up
payment terms for all customers
establish a follow-up plan for invoices
that become past due for example what
action will you take when they are in
each of the buckets one to thirty days
thirty one to sixty days etc review the
AR aging report on a weekly basis if
possible for more tips check out our
article on setting the best invoice
terms for your customers and getting
paid faster click here to access these
articles that wraps up the lesson on how
to run an accounts receivable aging
report in QuickBooks Online to access
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