How to Set up Class Tracking in QuickBooks?

If your business runs with multiple departments, locations, or product lines, the Class Tracking feature could be a game-changer for you. This powerful feature is available in both QuickBooks Desktop and Online, which helps you accurately track the financial performance of different segments. In this blog, we will go into detail about what Class Tracking is, how to enable and set it up, and how you can improve the profitability of your business by using it. And**** How to Set up Class Tracking in QuickBooks Desktop and Online!

What is Class Tracking in QuickBooks?

Class Tracking is a reporting tool that you can use to monitor the financials of different business segments. In Case:

• Department-wise income/expense tracking (Marketing, Sales, IT)
• Location-based profitability
• Product line differentiation

This feature is mainly useful for small businesses that need a detailed overview of their operations.

Benefits of Using Class Tracking in QuickBooks

1. Detailed Profitability Analysis – You can create multiple reports for different classes.
2. Department/Location Wise Tracking – Segmented reports for better decision making.
3. Improved Budget Management – It becomes easy to allot and monitor the budget for specific classes.
4. Tax Preparation Made Simple – Accurate tracking helps with compliance and audits.

How Can I Configure QuickBooks Desktop's Class Tracking?

Let's take a step-by-step look at how to set up class tracking in QuickBooks Desktop version:

Step 1: Allow Class Tracking

1. How to Open QuickBooks Desktop
2. Simply select the Preferences option from the top menu.
3. Select Accounting from the left console.
4. Select the Company Preferences tab.
5. Select the option to "Use class tracking for transactions.
6. If you want a class to be assigned to each transaction, also select Assign Classes from the prompt.
7. Finally, save the changes by just clicking on the OK button.

Step 2: Create Classes

1. Click on the list which is placed on the top menu & select the class list.
2. Click on class, placed Bottom left corner of the page > Click on new.
3. Now, enter the class name.
4. If the class is part of a parent class, then check that option.
5. Save & Close.

Step 3: Choose Classes to Transactions

Now, whenever you create a transaction (invoice, expense, journal entry), you will see a Class field where you can choose the relevant class.

How Can Class Tracking Be Set Up in QuickBooks Online?

In that process, a little bit different for QuickBooks Online users, where the class tracking feature is available in the QuickBooks Desktop Pro Plus and Advanced plans.

Step 1: Allow Class Tracking

1. Log in the QuickBooks Online.
2. Go to Settings & Click on Account Settings.
3. Select the Advanced tab.
4. Turn on Track classes from Categories.
5. If you want to assign a class to each line item, then do the Assign Classes between these transactions as well.
6. Save and Done.

Step 2: Create Classes

1. Select the list and go to Classes.
2. Click on the new button.
3. Add the class name
4. Choose the parent class if this is a subclass.
5. Click on Save.

Step 3: Use Classes in Transactions

Whenever you create an invoice, expense, or sales receipt, you will get the option to allocate a class to either a line item or the overall transaction.

Class Reports in QuickBooks

You can easily view class-based reports in QuickBooks:

• Profit and Loss through Class
• Balance Sheet by the Class
• The Class List Detail

With these reports, you can analyze which department or location is profitable and where cost-cutting or investment is needed.

Tips for Effective Class Tracking

• Consistent Naming: Keep class names logical and consistent
• Avoid Overlapping: Do not assign multiple unrelated classes in a single transaction.
• Regularly Review: Analyze class-wise reports every month.
• Train Staff: Train those Staff who do the data entry to assign the correct class.

Need Help with QuickBooks Class Tracking Setup?

If you need any assistance enabling, setting up, or troubleshooting Class Tracking in QuickBooks Desktop or Online, please contact us immediately.

• Our QuickBooks Experts are available 24/7 across the USA.
• Call Now: +1-844-405-0904

We will provide you with step-by-step guidance through remote support to make your accounting system more efficient.

Conclusion

Class tracking is a crucial tool for keeping an eye on several business areas. Whether you are using QuickBooks Desktop or the Online version, this feature can fabulously improve your financial visibility and decision-making.

If you have any confusion or problems in using this feature, please call us:

📞 +1-844-405-0904

FAQs

1. What Types of Businesses Is Class Tracking in QuickBooks Useful for?

Class Tracking is extremely useful for businesses that have multiple departments, locations, projects, or product lines, such as a retail company that operates multiple stores, or a service firm that has separate teams (Sales, Support, Marketing).

1. Is class tracking available in every version of QuickBooks?

-No, Class tracking is available in the Pro, Premier, and Enterprise versions of QuickBooks Desktop.

-In QuickBooks Online, this feature is only included in the Plus and Advanced plans. This option is not available in the Simple Start and Essentials plans.

1. How can I fix it if I unintentionally create the incorrect class?

By opening any transaction, you can change the class field. QuickBooks allows retrospective class changes, but you must make sure that there are no resolution or audit conflicts.