Tag Archive: Frontline Q7

  1. What Does a Trucking Company Balance Sheet Look Like?

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    A trucking company Balance Sheet might feel like a puzzle at first. But it’s a powerful tool for understanding your financial health. Think of the Balance Sheet as a snapshot of where your trucking company stands.

    In this article, we’ll cover how to build a Balance Sheet for your trucking company using simple building blocks.

     

    Balance Sheet Equation

    At the heart of every Balance Sheet is a simple law of accounting equation:

     

     

    You can also look at it as Assets – Liability = Equity

    These three blocks and the equation help you spot financial trends, manage cash flow, and keep your debts under control. Knowing where you stand financially helps you grow as a trucking company and avoid surprises. The industry comes along with enough surprises!

    • Assets: What you own and what you are owed
    • Liabilities: What you owe
    • Equity: Value left over for you

     

    Frontline Q7 Software - Calculate Trucking Company Balance Sheet

     

    Trucking Company General Ledger Accounts

    Each block of the Balance Sheet is made up of one or more general ledger accounts. Each account or “bucket” holds individual transactions.

    The category of an account determines which block it will fall in on the Balance Sheet. While there are many different categories of general ledger accounts, only a few of them will appear on the Balance Sheet.

    Frontline Q7 comes with a set of accounts that make sense for a trucking company. They are set up for recording transactions out of the box, which takes the guess work out of the process for you.

     

    Frontline Software_Trucking Company Balance Sheet GL Accounts

    Building Block 1: Assets

    This block contains everything your trucking business owns. The assets block can be divided into two general ledger account categories.

    • Current assets: Assets you expect to turn into cash within a year. Common current assets for a trucking company include:
      • Accounts receivable – Unpaid invoices from shippers, brokers, or other billable parties.
      • Driver cash advances – Track the outstanding balance of fuel card cash advances.
      • Inventory – If you own a shop, record your on-hand inventory value.
      • Bank accounts – Your checking and savings accounts belong here.
    • Fixed assets: Long-term assets that represent a big investment. Common fixed assets for a trucking company include:
      • Trucks – Value of trucks belong here, even if you’re paying off a loan.
      • Trailers that you own.
      • Accumulated depreciation – Since fixed assets lose value over time, you’ll see a negative account in this section showing depreciation. That way, your fixed assets section represents a true value. This is a requirement of the IRS.

    Frontline Q7 Software - Trucking Company Assets Balance Sheet

    Building Block 2: Liabilities

    This block contains everything your business owes. The liabilities block can be divided into two or three account categories:

    • Current liabilities: Liabilities you should pay off within the year. Common examples for a trucking company:
      • Accounts payable – Unpaid invoices to utility companies, fuel companies, etc. This can also include unpaid pay settlements for owner operators or carriers.
      • Driver escrow – Withhold funds for accidents, payments on licenses, etc. Use the funds when needed.
      • Payroll taxes – Use these funds when payment to the tax entity is made.
    • Long term liabilities: Debts that extend beyond a year. These types of liabilities can help you grow, but take care to manage them carefully. Common examples for a trucking company:
      • Truck & trailer loans
      • Cash loans from the bank

    Frontline Q7 Software - Trucking Company Liabilities Balance Sheet

    Building Block 3: Equity

    The final block contains what’s left over for you. A well-managed Balance Sheet helps you increase equity over time. This section can be difficult to understand, so Frontline Q7 computes retained earnings automatically so you don’t have to.

    • Calculated retained earnings – The history of net profit  You can find this figure on the Income Statement.
    • Year to date retained earnings – Net profit or loss within the same date range as the Balance Sheet. This is also found on the Income Statement.
    • Owner’s draw – A negative amount that represents the owner withdrawing funds for personal use.
    • Shareholder distributions – A negative amount representing a portion of the profits being distributed to shareholders.

    Frontline Q7 Software - Trucking Company Equity Balance Sheet

    Is The Balance Sheet In Proof?

    It’s important for the Balance Sheet to be in proof – meaning that the assets = liabilities + equity. If you look at the complete Balance Sheet, you will see that this is true. But why does it matter?

    • Accuracy in financial reporting: If it doesn’t balance, you have an error such as missing entries, incorrect account postings, or calculation mistakes.
    • Clear picture of financial health: You can use this snapshot to make informed business decisions, secure financing, and manage cash flow.
    • Credibility: Discrepancies on your Balance Sheet can raise a red flag to auditors, lenders, or investors.
    • Legal and tax compliance: A Balance Sheet that is out of proof can lead to penalties or scrutiny by regulatory or tax agencies.

    With the robust reporting tools in Frontline Q7, your Balance Sheet is always in proof. The trucking software tracks every transaction in real-time, so you can trust your report is accurate when you really need it. Furthermore,  additional reporting tools flag transaction data entry errors in real-time, so they can be fixed before they become a problem.

     

     

    Other Trucking Company Balance Sheet Tips

    • Accounts Receivable & Accounts Payable ratio: In the trucking industry, a good AR to AP ratio typically ranges from 1.5:1 to 2:1. This means that for every dollar owed to suppliers (AP), your company should ideally have $1.50 to $2.00 in receivables (AR) from customers.
    • Debt to equity ratio: In the trucking industry, a healthy debt-to-equity ratio typically falls between 1:1 and 2:1. This ratio shows how balanced your company is between borrowing and owner investments, and helps you understand if you’re borrowing within safe limits.
    • Return on assets (ROA): This measures how effectively you’re using your assets to generate profit, and therefore give you insight into whether your trucks and equipment are working hard for you. In the trucking industry, a healthy ROA typically falls between 5% and 10%.

     

    The Bottom Line

    Understanding your Balance Sheet might seem challenging at first, but it’s incredibly rewarding. By knowing what you own, what you owe, and how much is left for you, you’re set up to make smarter and more strategic business decisions. And with Frontline Q7 compiling your Balance Sheet effortlessly, you have one less thing to worry about.

    Ready to simplify your trucking company’s financial management? Let Frontline Q7 take the wheel. Reach out for a demo and see how easy it is to manage your Balance Sheet and more with the right tools.

     

  2. Q7 Tips & Tricks – Automate Line Haul Charges with Sales Profiles

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    Automate line haul charges in Frontline Q7 trucking software using Sales Profiles.

    Check out the YouTube video >>

     

    Set Up Automatic Line Haul Charges

    To make it easy, there are several places you can set up the charges you want to automate. This isn’t limited to line haul charges. Set up fuel surcharge or other regularly used charges.

    There are 3 types of Sales Profiles available. You can use one, two, or all three!

    • Customer – You want charges to automate based on the billable party.
    • Equipment Class – You want charges to automate based on the class of equipment hauling the load.
    • Company – Charges are applied to all loads.

    Set up the basis of billing, an optional default rate, and add the charge to the profile using a wizard.

    Click on the clip to see a quick demo of setting up an automatic charge.

    Frontline Trucking Software Q7 set up automatic line haul charges.

    Add Automatic Charges to Loads

    When you’re ready to add charges to a load invoice, click the Profile button or use Ctrl+R on your keyboard.

    Frontline Software Q7 add automatic charges to load invoice.This saves you about 4 clicks per charge!

    Forgot a charge or have something new to add? Use a Quick Insert straight from the load to add charges to the profile.

    Frontline Software Q7 Add a Sales Profile Item straight from a load invoice.Stack other automated features like rate chart tariffs and DOE index fuel surcharge scales to fully automate your charges. Add a fuel surcharge code to a Sales Profile with a blank rate. The DOE index scale applies the rate automatically.

     

    Save time and clicks

    Streamlining and simplifying processes is Frontline’s focus when it comes to data entry. To learn more about Q7 trucking software and its ability to automate line haul charges and other workflow tasks, reach out to us for a complimentary demo!

  3. Frontline Software Awarded Forbes Advisor Best Trucking Software 2024

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    We are proud to announce that Frontline Software has been recognized as one of the top trucking software providers of 2024 by Forbes Advisor! Out of a competitive field of 32 other ranked products, we achieved a spot on this prestigious list.

    Our team is dedicated to our product, and we take pride in this recognition. We also want to thank our current Q7 users for their support and trust in us. Thank you for being a valued part of the Frontline Software family!

    The Forbes research team highlighted Q7’s robust trucking accounting features. However, there are a few things they didn’t mention that we believe make us truly stand out among the other products on their list.

     

    Fully Integrated Platform

    Our software package includes accounting, dispatch, fleet maintenance, and reporting. Q7 also connects with fuel cards, ELDs, EDI, and other technologies, keeping your operations streamlined.

     

    Training & Support: Exceptional, Accessible & Personalized

    We understand that every trucking company is unique, and we pride ourselves on offering tailored training sessions to meet your specific needs. We want you to have an exceptional experience! Even after you’re off the ground with Q7, our support desk is just a call or email away. Furthermore, it’s our policy to never make you wait for a response for more than a few minutes. It’s important to us to forge personal connections you can count on!

     

    Cloud Based Options

    Flexibility is key. Whether you prefer hosting Q7 on your own network or the convenience of cloud-based access, we offer both options to suit your business model. With Q7 On The Cloud, enjoy safe and secure access, daily backups, and scheduled updates. Leave the networking to us!

     

    Receiving this award is an honor, but our daily commitment to our users remains our top priority. We’re here to help trucking and brokerage companies thrive with the best software tools and support in the industry. If you’d like to join the Q7 family, reach out to us for a complimentary demonstration!

  4. What Does a Trucking Company Income Statement Look Like?

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    The Income Statement, also known as a Profit & Loss (P&L), is a vital tool for understanding your trucking company’s financial health. This report gives you a snapshot of profitability over a specific period of time, and can help you make informed decisions about your operations.

    In this article, we’re covering the parts of an Income Statement for a trucking company, exploring key metrics, revenue sources, and expenses.

     

    General Ledger Accounts

    Before we get into the building blocks of the Income Statement, it’s important to understand what each building block contains. Each block of the Income Statement consists of one or more general ledger accounts. When you create a general ledger account in your trucking software, you’ll get a chance to categorize it.

    This determines which block it will fall in on the Income Statement. While there are many different categories of general ledger accounts, only 3 of them will appear on the Income Statement.

     

    Create GL accounts with the correct category so they fall in the right block on the Income Statement.

     

    In this way, you can break each block down to be more descriptive. Some trucking software will have an additional layer called Items or codes. As a result, you have the flexibility to assign one general ledger account (i.e., line haul revenue) to any variety of line haul revenue sources (i.e., mileage billed, tonnage billed, etc.). In this way, you don’t muddy up your Income Statement with too much detail.

     

    Building Block 1: Revenue

    At the heart of the Income Statement is the revenue block. This block outlines the earnings or income your trucking company’s services generated.

    In this case, the revenue primarily stems from transporting goods or cargo from one location to another. Frontline Q7 categorizes the various streams of revenue automatically while you’re entering your load invoices.

    Examples of revenue that would be seen on a trucking company Income Statement:

    • Freight Revenue – The core earnings generated from transporting goods. In the industry, this is often called the line haul revenue. On the billing level, it’s often calculated based on factors like distance traveled, weight hauled, or the type of cargo.
    • Accessorial Revenue – Additional charges on billed invoices beyond the line haul or freight. Common accessorial revenue streams include fuel surcharge, detention, and even things like TONU (truck ordered, not used). Supplementary services like warehousing charges or expedited shipping could be included in this block, as well.

     

    The income or revenue block contains all streams of revenue, broken into smaller descriptions.

    Building Block 2: Cost of Goods

    This block contains everything that represents the costs associated with building your revenue block. In the trucking industry, the difference between cost of goods and expenses can become blurry. In general, you want to assign this category to expenses that relate directly to hauling loads, which is your primary source of revenue.

    Correctly assigning costs to this category is crucial for determining the profitability of your trucking company, which is a topic we’ll delve into later.

    Examples of costs that would be seen on a trucking company Income Statement in this block:

    • Driver pay – The backbone of any trucking operation is its drivers. When you produce pay settlements, those costs should be reflected in this block.
    • Owner Operator or Carrier Pay – If your fleet includes these types of trucks, make sure you include their load pay in this block, too.
    • Fuel – Fueling a truck is required in order to haul a load and generate revenue. However, your accountant may ask you to put this type of cost in the expense block.

    The cost of goods block contains costs directly associated with generating revenue.

    Building Block 3: Gross Profitability Calculations

    This block calculates the gross profit by subtracting cost of goods from revenue. It shows how profitable your operation is before overhead expenses. Furthermore, it offers an insight into your ability to generate revenue efficiently.

     

    The gross profit calculation tells you how efficiently your trucking company generates revenue.

    Building Block 4: Expenses

    This block contains costs that are necessary in order to run a business. These are costs that remain constant regardless of whether loads are hauled or revenue is generated. You’ll probably have a large quantity of general ledger accounts in this block, because your CPA will want a description of your overhead expenses.

    The expense category follows the gross profit calculation because it helps determine your overall net income.

    Examples of costs that would be seen on a trucking company Income Statement in this block:

    • Office staff wages – Dispatcher and general administration. These people are critical to your operation, but you will pay them whether or not your trucks are moving loads.
    • Payroll taxes – Always assign the expense category to the employer expenses. Frontline Q7 will calculate payroll taxes and assign the expense automatically.
    • Telephone and internet – All of your utilities should be assigned to this category.
    • Insurance Premiums – Insurance premiums on your trucks or other equipment occur regardless of whether you’re hauling loads and generating revenue. We can also consider employer related insurance premiums as an expense.

     

    The expenses block contains trucking company overhead costs.

    Net Profit

    The final figure is the net profit, and it represents your operation’s bottom line.

    This number encompasses all of the blocks we just covered. Understanding and monitoring this number is essential for evaluating your trucking company’s overall performance during that period of time. Frontline Q7’s Income Statement report also includes a comparison between the figure from the previous year, which helps you make more informed decisions as a business owner.

    The equity section of the Balance Sheet includes the net profit or loss, meaning your bottom line represents your earnings.

     

    The net profit (or loss) figure is your bottom line.

    Takeaway

    Understanding the Income Statement of a trucking company is essential for gaining insights into its financial performance, operational efficiency, and overall profitability. By understanding the blocks of the Income Statement, you can assess your company’s ability to generate revenue, manage costs, and navigate the complex landscape of the transportation industry.

    Frontline Q7 provides all the essential financial reports tailored specifically for the trucking industry. Gain full visibility into your operation so you can make informed decisions. Contact us for a free demonstration.