Hi, this is Valerie Chow. Welcome to Knowledge City's advanced course on QuickBooks 2010. This is a continuation of our introductory QuickBooks 2010 course where we set up and learned about a service business. Now we're going to learn how to expand into a merchandising business. We will start by understanding the difference between a service business and a business that also has inventory, which we call merchandising business. The course starts with our Learn Everything Tutoring Business, which we worked with in the introductory course. Remember, we sold tutoring for math, English, science, and test prep, as well as note-taking and other services. Sometimes students who are tutored might need certain other supplies along with their tutoring, such as worksheets, books for the subjects, and perhaps pencils. We're going to learn how to add these to our service business and make Learn Everything Tutoring a merchandising business, as well. We will start with the chart of accounts to analyze it to determine what additional accounts will be needed for the merchandising functions. We will then add new inventory items for sale to the item list. We will update both customer and vendor information so that we have shipping terms, shipping methods, shipping address, credit terms for customers, and credit limits. We will also enter more customer and vendor transactions so that we can see the effects on our reports. Later, we will add employees to our business. As your business grows, you may need to add employees, perhaps to sell, package, ship, or take orders for your new products. So therefore, we will set up a simple payroll showing you how to set up the employees, their checks, and the liability accounting for payroll. Then, we will learn how to add a partner to our business and show what happens when we divide the net income between partners at the end of each financial statement period, how we make adjusting entries during the ending period accounting, and how we set up our fixed assets and depreciation, including making adjusting entries for those. Finally, we will see the end of period reports for the merchandising business both before and after we close the books to show the effect of closing the period in QuickBooks. Again, I am Valerie Chow. I've been teaching QuickBooks and accounting at a local college since 2004. Every year we have a new group of students excited about learning both financial accounting and the software QuickBooks, which implements it. Now, we're ready to begin.