Welcome to the Fit Small Business Xero training course. In this lesson we're
going to cover how to create a bill in Xero. To follow along with me, log in to
your Xero account now, or click the link below this video for a free 30-day trial
of Xero. You can also click this link to access our full Xero course and other
helpful resources. Let's get started. While most business owners prefer to
keep track of the money that their customers owe them, known as accounts
receivable, it is just as important to keep track of what you owe suppliers,
known as accounts payable. Xero makes it easy to track all of your bills so
that you can pay your suppliers on time. Here are a few benefits to managing your
bills in Xero. You can record payments maybe a check, ACH, or credit card.
Batch payments is also available if you need to pay a supplier multiple bills at once.
We will discuss how batch payments work in the next lesson. You can click here to
access this lesson. Second you can set up payment terms so that Xero will generate
a reminder once a bill is coming due. Third, when you create the bill you can
assign the account that you want to track the expense to so that Xero can do
the accounting for you in the background. And finally your accounts payable
balance will always remain up to date. In this lesson we will walk through the
steps to create a bill, we'll show you how to modify a bill that was previously
entered, and how to create a repeating bill for those items that you pay on a
periodic basis such as monthly or quarterly. We will also show you how the
new side-by-side files feature can help you enter bills faster and manage them
more effectively. From the accounts menu go ahead and select purchases.
And then click the drop down arrow to the right of the new button and select bill.
This is the new bill template. In the front field you want to go ahead and
select the supplier from the drop down. If you have not set up the supplier,
you can easily do that in this screen by clicking the new
contact option here at the bottom. In the how to set up suppliers lesson we walk
you through this step-by-step. You can click here to access this lesson. In the
date field go ahead and enter the invoice or bill date that appears on
the bill that you received from the supplier. If you set the default payment
terms the due date field will automatically populate. However, if you
did not, you can enter the due date that appears on the bill in this field.
Be sure to check out how to customize invoices to learn how to set up default
payment terms for suppliers. You can click here to access this lesson.
The reference field is an optional field. You can include any additional information
that you would like to keep track of in this field. The icon to the right of the
reference field is an attached file. Xero allows you to attach any supporting
documents and a copy of the bill to this transaction. All you have to do is scan the
document to your computer and click this button to attach it. In the item field,
if you have been billed for core items that you purchase, you can select the items
from the drop-down. However if you did not previously setup the item, then you
can do so in this field by clicking the new item option here. You can click here
to access this lesson. The description field will automatically populate based
on the item that you selected. If you did not select an item, then simply type the
description that appears on the supplier bill as we have done here. Enter the
quantity of the items purchased. Please note for services, you want to enter a
quantity of one as we have done in this example here. Unit price: the field for
unit price will automatically populate based on the item that you selected.
If you did not select an item then enter the unit price that appears on the
supplier bill. Account: select the account from the drop-down that you want to
categorize this purchase to. To learn more about accounts, check out the how to
set up charge of accounts tutorial. You can click here to access this
lesson. You can turn on tracking categories to track other areas of your
business like location, department, or in this example region. Select the
appropriate category from the drop-down. Xero will automatically multiply the
quantity times the rate to calculate the amount. Please note that if you need to
pay a supplier in another currency, check out our how to set up multi currency
tutorial to learn how to pay bills in a foreign currency. You can click here to
access this lesson. This field is the tax field. This field will automatically
populate based on the items that were selected. However you can select a
different tax rate from the drop down if you need to. Check out the sales tax
rates lesson to learn more. You can click here to access this lesson. At the bottom
of the bill you'll see this blue link that says assign expenses to a customer.
If you purchased an item on behalf of a customer, you can select the customer
here so that Xero can remind you to bill the customer back the next time you
invoice that customer. And finally you can either save the bill or approve the bill.
Let's talk about our save options. The save as draft option will save the
bill and allow you to close out of this screen. The save and continue editing
option will allow you to save the bill periodically so that you don't lose any
information if you need to come back and complete it later on. The save and submit
for approval will save the bill and submit it for approval. If you have
approval authority then you will see this green approve button over here,
which we'll talk about in just a second. And then the save and add another option
will save this bill and it will open up a new blank bill to allow you to enter
multiple bills without closing out of the screen. Now let's talk about the
of options here. The approve option will save your bill and you can proceed to
pay it via check or online with your bank or financial institution. The approve and
add another option will save the bill as approved and it will open a new bill
screen for you to create another bill. This feature allows you to enter a stack
of bills very quickly because you don't have to close out of the screen to
create the next one. To save even more time, check out how to import those
tutorial to learn how to import bills from an Excel or CSV file into Xero.
You can click here to access this lesson. Approve and view next: this option allows
you to approve the bill and then view any bills that may be awaiting your
approval. In the how to invite users to Xero tutorial, we discuss how to give
users permission to approve bills. You can click here to access this lesson.
Xero makes it pretty simple to make changes to bills that you have
previously entered. So we want to go ahead and go back to the bills page so
let's click on accounts, and select purchases. Bills that have been
previously entered will fall into one of four categories: draft, awaiting approval,
awaiting payment, or overdue. Bills in the draft status are bills that you have
created but you have not approved them or submitted them for approval.
Please note bills in a draft status have no impact on your financial statements.
Bills awaiting approval have been submitted for approval but have not been
approved yet. Please note bills in this group do not affect the financial
statements. Bills awaiting payment: bills in this group have been approved but not
paid. Please note bills in this group do
affect your financial statements. Finally bills that are overdue are bills that
were not paid as of their due date. In how to create an accounts payable aging
report, we will share some tips on how to stay on top of your
accounts payable balances. You can click here to access this lesson. If you scroll
down here we have a section called upcoming bills. And over to the right
we've got our legend. The bills that are in blue are due on the dates as
indicated on this grid here. Bills that are in green are bills that have been paid.
Along the bottom here you can see the months, so we've got June, July, and
August. And so you can simply scroll here, drag this marker and scroll to move
across to see what's coming up. To modify a bill you want to go ahead and click on
the category that the bill falls into. So the bill that we want to make changes to
is actually in a draft status. And then you'll see all the bills listed here
that are currently in a draft status. So to select a bill to make changes to you
simply want to go ahead and click here on the actual name of the supplier.
And it will display the bill. You can make any changes that you need to and save
and approve them once you are done. Please note that you cannot make any
changes to a bill that has been partially or fully paid. If you need to
make edits to a bill that was previously paid, you would have to remove the
payments first, edit the bill, and then reapply the payments. As we mentioned
previously you can set up recurring bills that you pay on a periodic basis
such as a monthly, weekly, or quarterly. You can also delete and copy bills.
So first we will cover how to set up a repeating bill and then I'll show you
how to delete and copy bills. So using this bill here, the same bill,
we'll go ahead and click on our bills option button up at the top.
And it will display the bill.
So go ahead and click on repeat. And then here's the information that we need to
complete to set up a repeating bill. So first of all we need to let Xero know
how often we want this transaction to repeat. And so we need to put a number in
this box here based on our selection here.
So either we want it to repeat on a weekly basis, or monthly. So we'll select
that and we'll leave the number one there. If you wanted to set up a
repeating bill for every quarter, then you would simply put a number 3 in here.
And then every three months the bill would repeat. Bill date: indicate the date of
the first bill that will be created and as you can see this is where we have our
option to repeat the bill, delete the bill, and copy the bill. The due date
field will automatically populate with the default due dates that were set up
in the how to customize invoices lesson. You can click here to access this lesson.
If you want to change the due date you simply can do that directly in this
screen by putting the date that it's due and then making a selection from the
drop down here. The end date field is optional.
Here you can indicate when you would like Xero to stop creating repeating bills.
Please note that it's not necessary to set up an end date because you can cancel
repeating bills at any time. Save as draft and approve: so you could indicate
whether you want the repeating bill to automatically save as a draft bill or
automatically approve once it's been created. Please note that the options
here will depend on the user permissions that you have been set up with. You can
click here to access our user permissions lesson. In the bill from
field here, this should include your supplier's name. The reference number
field is optional. Please note that whatever is indicated in this field will
appear on every repeating invoice that is created.
Now below make sure that you complete the item field if applicable,
the description field, quantity, unit price, and the account, tax rate, tracking
category as well. Be sure that all the information in the body of the bill has
been completed as well as you can see here. And then once that
has been completed you can go ahead and save the repeating bill. Once you have
saved the repeating bill, you'll see a notification here up at the top. And then
you'll also see a new tab called repeating. All the details of any
repeating bills that you have previously set up will be listed here. In general
you should not get in the habit of deleting information from your
accounting software program. However there are times when it is okay to do so.
You can delete a bill that has not been paid. So go ahead and display the bill as
I previously showed you. So we'll select this bill and then if you click on the
bill options button up here you will see the option to delete the bill.
Please note that if you are not able to delete the bill because it has been paid,
you will have to avoid it instead. For example if this bill that we selected
had been paid you would not see a delete option here, but instead you would see a
void option. Last but not least, if you receive bills from a supplier that are
almost identical, you can copy a bill that was previously
entered and just make the few changes necessary to save you a few keystrokes.
To copy a bill you would simply select the copy option here, and then make any
necessary changes to the bill and save it. One of the newest features that Xero
offers is called side-by-side files. This cool feature allows you to store copies
of your bills, invoices, and other documents within Xero next to the
transactions they relate to. This will allow you to easily access
these documents during tax season or in case of an audit. To use this feature you
can either email documents to your Xero inbox, or drag and drop documents
directly into the inbox. From the dashboard you want to click on the file
icon here right below your name, and you want to provide this email address to
suppliers, customers, and anyone else who sends you documents that you would like
to attach to transactions. To add a document you can either upload it from
your computer, take a photo or simply drag and drop it here.
Select the document within your Inbox by putting a check mark next to it.
And then you want to click on the add to new button and select any transaction that
you'd like to create. And this next screen is going to pop up you're going
to see a side-by-side view of the bill that was uploaded here on the left, and
the new bill screen or in this case the new expense claim screen here on the right.
This side-by-side view allows you to easily enter the details of a bill,
customer invoice, expense claim, or receive or spend money transaction since
the details are right in front of you. Best of all, the document is
automatically attached to the transaction so you can access it
whenever you need to. That wraps up the lesson on how to create a bill in Xero.
To access our full Xero course or any of the other lessons in this series click
this link. You can also find a link below this video for a free 30-day trial of Xero.
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