Which of the following describes the correct steps to condense data in QuickBooks?

• A. File>Utilities>Condense Data
• B. Backup online
• C. File>Utilities>Condense Data; Select: All Transactions
• D. Help>Update QuickBooks

Answer: (C)

Condensing data in QuickBooks reduces the file size by summarizing or removing older transactions, so you want to use the Condense Data tool and specify exactly what data to condense. The correct steps are to open File > Utilities > Condense Data, then choose the scope of data to condense, such as All Transactions. This combination—accessing the tool and selecting the data range—is necessary to actually perform the condensation on the whole data set. It’s a good practice to back up your file before doing this, because condensing makes irreversible changes to the data structure. Other options don’t perform condensation: simply backing up or updating QuickBooks isn’t condensing, and selecting the tool without choosing the data scope leaves the task incomplete.