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  #1  
Old 08-14-2011, 09:27 PM
Tizzy Tizzy is offline
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How to reconcile Credit Cards?

I was curious how I can reconcile all of the credit card statements?
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  #2  
Old 08-15-2011, 05:00 AM
Joe Williams Joe Williams is offline
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If you enter Credit Card Charges into a credit card account like "Visa", when you open Reconcile you can select "Visa" as the account. Then reconcile just like it was a bank statement, verify the transactions in QB to the ones on the statement.
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Old 08-15-2011, 06:48 AM
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Credit card setup and procedures

This is the general procedure for using credit cards through QuickBooks.:

Set your AMEX (or whatever) up as a credit card type account. Do not enter any beginning balance in the new account window.

When paying bills previously entered into QuickBooks, go to Pay Bills. Select Credit card as the payment method and pay the bill(s) with that.

Enter all of your other credit card charges, using Enter credit card charges window. (or download them)

You can create generic vendors (Meals & ent, Gas & auto, etc) for recurrent purchases where you don't need to track the vendor name.

When the statement comes in, reconcile it as you do a bank statement, using the statement end date and current balance.

When you finish, either write a check to the credit card company (vendor name) for whatever you want to pay, or cancel and write a check later using the cc account as the offsetting account on the write check screen. (I would not enter a bill for this - it reeks havoc with the system...)

You can enter your payment into QuickBooks at any time. . .be sure to offset the AMEX credit card account in the account field.

Just put 'online' in the ref # field instead of a check number.

When transferring balances between cards, do this:
Enter credit card charges. Use the account that is absorbing the balance and put the other account in the expense line.




When posting the charges, if there are non-business charges, use the Owner Draw/Distributions account for those expenses.

Then, through the Enter Credit Card charges window, post the personal payment, if applicable, as a credit entry (select the credit button at the top of that form) and use the same Owner Draw/Contributions account on the expense line.


I hope this helps,



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  #4  
Old 08-15-2011, 10:56 PM
Tizzy Tizzy is offline
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Wow thank you, that is a lot of information to absorb.

I notice the person before entered all of the credit card activities to excel spreadsheet, do you know why? She never reconciled credit cards in QB.
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  #5  
Old 08-16-2011, 05:24 AM
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My observation is that many people use excel and, in the process, work too hard to get what they need (or think they need) because they don't know how to use QuickBooks efficiently.

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  #6  
Old 09-09-2011, 12:29 AM
edan edan is offline
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Do you set up the credit card company as a vendor -expense type in chart of accounts -and also as a credit card type in the chart of accounts

You post the cheque payment to the CC card company (vendor) and the account it goes to is also the CC card company?

I am confused
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  #7  
Old 09-09-2011, 01:57 AM
Joe Williams Joe Williams is offline
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The Credit CArd company is a Vendor. Use Enter Credit Card Charge to enter the charges. That transaction will use the Credit Card account and the expense accounts to track the purchases. You just use a Check with the Credit Card account to pay the credit card company.
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  #8  
Old 09-09-2011, 03:07 AM
edan edan is offline
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but are you entering the expenses 2x
one time as the credit card charges & the 2nd time as a cheque for the total charges for the month to the CC company?
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  #9  
Old 09-09-2011, 02:58 PM
cojhl2 cojhl2 is offline
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When you pay the CC company the check is written to them with no reference to the expense charged to the cc. It's kind of like a AP, when you pay the vendor you don't repost to the expense accounts!!
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  #10  
Old 09-09-2011, 06:36 PM
MzDallas MzDallas is offline
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Smile Re: How to reconcile Credit Cards?

Edan,

cojhl2 is correct.

When you post each cc charge, it debits the expense and credits the cc's liability account.

When you then reconcile the cc acct, the 'payment' you create becomes a Bill, debiting the cc liability account, and crediting the normal AP. That Bill then shows on your AP reports (aging, etc.) until you pay it.

When you pay this AP Bill, it debits the AP account and credits your checking account.

The specific reason for this method? Most cc stmts include literally dozens of entries. If each were input directly into AP as a separate bill, it would be a real monster to pay, having to click each $2 charge, and of course, the ckstub itself would be several stubs long.

Also, each cc is a 'form of payment'. When you go in to pay bills, if cc's were processed simply as vendor bills, you would have to issue Vendor A a credit memo to log the payment, and enter a separate bill under the cc's vendor bills.

Then, trying to 'link' one vendor's credit memo with the cc's vendor account bill would be a programming nightmare - it would leave way too many things open for software glitches.

A cc is actually a loan account, a line of credit like you have at the bank, and QB treats it as such.
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  #11  
Old 09-10-2011, 02:22 AM
Joe Williams Joe Williams is offline
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THANK YOU Carla!! Most people do not relize that a credit card is like paying for something with a loan!!!
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  #12  
Old 10-27-2011, 01:13 PM
Tizzy Tizzy is offline
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I started my job 3 months ago, i have been receiving cc statements but still do not know what to do with them. Do I enter everything that was charged on the statement into QB? The person before me never used QB to reconcile the cc statements.
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  #13  
Old 10-27-2011, 01:25 PM
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LauraD LauraD is offline
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This is my general procedure for using credit cards through QuickBooks:

Set your AMEX (or whatever) up as a credit card type account. Do not enter any beginning balance in the new account window.

When paying bills previously entered into QuickBooks, go to Pay Bills. Select Credit card as the payment method and pay the bill(s) with that.

Enter all of your other credit card charges, using Enter credit card charges window. (or download them)

You can create generic vendors (.Meals & ent - Misc vendors, .Gas & auto - Misc vendors, etc) for recurrent purchases where you don't need to track the vendor name. Put the vendor name/location in the memo field, if desired, for better tracking.

When the statement comes in, reconcile it as you do a bank statement, using the statement end date and current balance.

When you finish, either write a check to the credit card company (vendor name) for whatever you want to pay, or cancel and write a check later using the cc account as the offsetting account on the write check screen. (Generally speaking, I would not enter a bill for this - it reeks havoc with the system...)

You can enter your payment into QuickBooks at any time. . .be sure to offset the AMEX credit card account in the account field. I create a specific vendor name (AMEX 09001, for example) with the account pre-fill to point to that credit card account.

If you are paying online, just put 'online' in the ref # field instead of a check number.

When transferring balances between cards, do this:
Enter credit card charges. Use the account that is absorbing the balance and put the other account in the expense line.

When posting the charges, if there are non-business charges, use the Owner Draw/Distributions account for those expenses.

Then, through the Enter Credit Card charges window, post the personal payment, if applicable, as a credit entry (select the credit button at the top of that form) and use the same Owner Draw/Contributions account on the expense line.

I hope this helps,
Laura D
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Advanced Certified QuickBooks ProAdvisor
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www.centsablebookkeeping.com
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