Steps to Preparing a Budget in QuickBooks Online

By Elaine Marmel

Part of QuickBooks Online For Dummies Cheat Sheet

QuickBooks Online (QBO) supports preparing budgets, which help you monitor, track, and compare expected income and expenses with actual income and expenses. When you prepare a budget, you typically prepare it for a fiscal year, and you can opt to supply budget amounts or use historical amounts from QBO. You also can opt to subdivide your budget based on customer, location, or class.

QBO uses pop-up windows to help you prepare budgets. If you have your browser set to block pop-ups, you should make an exception for QBO.

How to check fiscal year settings in QuickBooks Online

Before you start to prepare your budget, you can double-check your fiscal year settings by following the first five steps:

  1. Click the Gear button at the top of the QBO window.
  2. From the drop-down menu that appears, click Account and Settings in the Your Company column.

    qbo-account-settings

  3. Click Advanced on the left side of the dialog box to display the settings in the Accounting section.

    qbo-accounting

  4. In the Accounting section, double-check that the first month of your fiscal year is correct.

    If necessary, you can change the first month of the fiscal year by clicking it.

  5. Click Done, which appears in the lower right corner of the screen but isn’t shown in the figure.

How to create a budget in QuickBooks Online

To prepare a budget in QuickBooks Online, you can build the budget from scratch or you can have QBO establish the budget using actual data from the current year or the prior year. In the steps that follow, you create the budget from scratch. Creating a budget involves using a very short wizard.

  1. Click the Gear button at the top of the QBO window.
  2. From the drop-down menu that appears, click Budgeting in the Tools column.
  3. Click Add Budget on the Budgets page that appears.

    The New Budget wizard starts.

    qbo-new-budget

  4. Supply a name for the budget you want to prepare, along with the fiscal year it covers, the interval for the budget, and whether to pre-fill the budget with data and to subdivide the budget.

    You can pre-fill the budget with actual data from the current year or last year, and you can subdivide a budget by customer if you so choose. If you opt to pre-fill, you won’t see any further wizard screens; QBO will simply create the budget and display a page containing pre-filled amounts for each account that you can change if you want.

  5. Click Next, which appears in the lower right corner of the screen but isn’t shown in the figure.

    The second page of the interview appears.

    qbo-second-page

  6. Fill in budget amounts for each account you want to budget.

    You can press the Tab key to move from field to field.
  7. When you finish entering budget amounts, click Save or Save and Close in the lower right corner of the screen.

    The Budgets page reappears, showing the budgets you have created.

    qbo-budgets

If you open the Edit menu in the Action column by clicking the arrow beside Edit, you find that you can copy a budget, delete a budget, and prepare a Budgets vs. Actuals report and a Budget Overview report.