Hey, it's Candus and in today's QuickBooks tips and tricks,
we are gonna talk about credit cards.
So this is a request per Mary,
of how to really understand
what's happening behind the scenes within your credit cards.
So I'm gonna go over again, how to enter credit cards, how to reconcile them.
Once you reconcile them,
how do you apply payments on a regular basis,
so that if you're carrying a balance within on your credit card,
that you're taking care of QuickBooks properly,
come look over my shoulder, and I will teach you how
now that I'm inside QuickBooks, let me show you what you do.
So the first thing I want to show you is where do
your credit cards sit within QuickBooks, where can you go and
see what's happening within your credit card.
So the first step is to go under list, Chart of Accounts.
There's also chart of accounts from the homepage, but
what you're gonna do, this is a sample file that I use for my training purposes,
here is a credit card that we have added in the past.
So if you do not have a credit card currently inside your QuickBooks,
you would go under list, Chart of Accounts
here,
go down to the bottom and click, New
pick credit card, continue
and then you would just type in your credit card,
what it's called.
So the one I have right now is called Capital One
and then I recommend if you have more than one credit card,
putting the last four digits of the
card, or the account number on the title here,
if you have a beginning balance, you can enter it here
like an opening balance,
what I recommend doing is
going
figuring out what time frame you want to enter.
So if we're in
this October right now at the end of October,
and you want to enter all the 2015
go back and find your credit card statement
from the beginning of the year.
So it would be the one
that has all the transactions as of January so,
if your credit card is kind of mid year ends,
you want to pick the one from December,
find the beginning balance and put that in.
If you need any help, feel free to contact me
and I can help you with that as well. I can create another video on how to do that.
But I figured this video is gonna be everything I can teach you
pretty much about credit cards as quickly as possible.
So you gonna enter, create a credit card.
So you'll see mine is here it says Capital One 2345.
Its type is credit card, which I just showed you
and the balance right now and here is 105.
So what this means is,
I'm not paying my credit card off every month,
which is the question, I received from Mary.
So let's look at that real quick.
I've created a previous video on how to do credit cards.
This one we're just going into more depth on.
So Mary said that she watched it but she wanted to understand what to do
once it comes up to reconcile so we're gonna cover that today.
She also said she want to understand,
you know what's happening accounting wise
and if you carry a balance or do partial payments from month, to month,
how do you check that?
And if you are doing correction transactions,
how do you also know that you are correcting it properly?
So I'm gonna do my best to answer all the questions
today.
So what you're gonna do is,
you're gonna have your credit card,
the first thing I recommend you do is you actually double click on it
if you've been using it,
and look and see what the transactions show you that you've entered.
So in this example,
back in August,
I entered a couple transactions
and then we did a reconciliation,
we made a partial payment of 150, which left a balance of 105.
So over here on this right column, you'll see balance,
it said $255,
we made a payment
of 150, which left us a balance of 105.
So today, I'm gonna show you how do you, I'm gonna close all these screens.
Let's say that you're ready to now enter credit card charges.
So what you can do, is you can either go here under banking and click enter credit cards,
or here under banking,
and click enter credit card charges.
So you're gonna want to make sure that the first thing you do is you select the
correct credit card, if you have more than one.
This is,
you would select this little box, this little circle if you have charges,
and if you've returned something and you have a credit,
you'd actually select this and then QuickBooks knows behind the scenes
exactly what to do with it.
To the right, you'll notice it says ending balance
the $105 that I just showed you in the chart of accounts.
So
we're gonna go in here and we're gonna do a charge
You wanna make sure it's to a vendor.
Let's say it's to Office Depot,
we use today's date, I'm creating this video on the 28th of October.
If you have a reference number or receipt number,
you're welcome to use that, but it is not required.
It just gives you more data,
then you would put in the dollar amount
that you're charged to your credit card was for.
Then you could put a memo in if you want.
Then you're gonna go down here to expenses
and you are gonna drop this down
and you can scroll down and find your office supplies.
If you're at Office Depot, I'm guessing it's office supplies you're buying.
You can break it down to multiple expenses if you want,
you can put another memo in
if it goes for specific Job, I'm not gonna cover that today.
And then if you have classes, which I've
discussed before in a previous video, if you want to know more about those,
feel free to check that video out.
I'm just gonna select business for today
and then click Save and Close. If you have a multiple
credit card charges that you're gonna be entering,
you'd actually click save and new,
and then click Save and Close.
And that's as easy it is, as it is to enter your credit card charges.
So what you would do is, when you get your statement,
you go in, you grab your statement, and you look at every transaction,
and you enter them
into QuickBooks,
when you're done, the next step is to click reconcile.
So we're actually gonna click reconcile,
we are gonna drop this down and make sure we pick our credit card,
I'm gonna get my calculator out so that I make sure I do this right.
It's $105 plus I just did a $12
transactions, it's gonna be 117.
Now the, where you're going to get this balance
is off your credit card statement.
So you're gonna look at your credit card statement
where it says ending balance, so you have a beginning balance
that should match this
and then you'll have an ending balance and that should match this
actually gonna adjust this out to just say October 31st
and if you've gotten, you have a credit card finance charge,
you can put that in here, which is like interest,
the date that they charged it for you.
Normally,
you do it every month,
so this would be the previous month, then you would do September.
But because I'm showing this example in October,
I'm gonna go ahead and go up to October.
So make sure you grab your bank state, your credit card statement,
you use your ending credit card date,
they should be the following month.
Make sure this is exactly right.
So if your credit card ends on like the 17th of the month,
choose the 17th whatever date
it says on your statement,
make sure your beginning balance is correct. Make sure ending balance is correct.
Any finance charges, the date,
you'll go to interest expense,
finance charge, whatever you have in your QuickBooks.
If you use classes, it will show up otherwise that won't be there,
you're gonna click Continue
and your credit cards are gonna come up
So what you're gonna do is on the left side,
it shows all the charges.
And on the right side it shows all the credits or payments.
If you have not been reconciling your credit card,
you'll see this little box up here where it says hide transactions,
you're gonna want to check that.
And then anything after the period date that you picked for the statement will disappear.
So you have your like years and months in here.
Go back, fix it, do it right,
credit cards often get messed up because people
don't understand how to enter them, they don't go in here
and enter each individual under enter credit cards.
They don't enter each individual charge.
They try to do lump sum, and then they get messed up.
So do each individual charge,
and then reconcile it and don't
move on until it balances till it's matches to the penny.
So you're gonna grab your statement and you're gonna go okay,
that was a charge, that matches, that matches, oop, there's my payment.
Perfect
and you'll notice over here to the right,
you have your ending balance, your cleared balance, and the difference is zero,
it has to be zero to move on.
If it's not zero,
there's a problem, go back and fix it, figure it out.
If it does, if it says it doesn't match, and there's a difference,
yet you look to the left and your beginning balance is correct.
And your charges seem correct
or you, and it still doesn't seem right.
Go back and click Modify
and change and check and make sure your ending balance is correct.
Because every now and then somebody will do a typo
on their ending balance and everything won't match and they can't figure out why.
Okay.
So that's what you're gonna do, you're gonna make sure it says zero,
then you're gonna click reconcile.
If you're in the middle of a reconciliation,
and something doesn't match, or you have to leave,
you can actually click leave,
and then come back and do it again later
and finish it.
Once it's properly done.
Everything balances it says zero here,
please, please promise me you'll only click if it says zero
(laughs)
Click reconcile now.
This little part comes up and this is where Mary's question is
because my last video
ended here.
What you're gonna do
is it says that outstanding balance
is $117 or in other words,
your balance you owe 117
do you want to write a check for it right now?
Or do you want to enter a bill, a payment later?
Most people
that I work with and I personally do this, I reconcile my credit card
once I get my statement in
but that's not always the same timeframe that I'm paying it.
So if it is you can click write a payment
or you can, I don't recommend using enter bills
cause what enter bill does is it puts it as accounts payable,
but you already have entered those charges
so they're already gonna show up on your profit and loss.
You don't really want to use this enter bills unless you're wanting accounts payable.
I don't recommend that for most businesses.
It just will confuse you. So don't do it.
Even though those are the only two options that they give you
don't, if you're not gonna pay it right now,
what I want you to do is click Cancel
and you might be like, oh my goodness, I didn't even know that was an option.
It is. That's what I'm here to show you.
Then the next step is,
you can print a piece of paper to attach it to your statement, if you want.
I typically recommend just doing summary,
and clicking print
and that's all you have to do.
I'm gonna click display, let's see if it'll work.
Sometimes I have a little glitch with my QuickBooks,
oop, it worked. Okay, perfect.
So this is what I'd recommend you print,
it has your beginning balance,
your charges, your payments and your ending balance.
Print that, I'm just gonna close it for today.
Attach it, file it away.
Now the next step,
a few weeks later, whenever it is, maybe even,
you've already made all the payments, because hey, let's
I'm just like you guys, I get behind on my bookkeeping.
So let's say you've already been making payments.
and
you know you're catching up, it's October and you're catching up from January,
what you would do next is you'd want to make sure all your
payments are put in and the way you put those in,
is you would go here to write checks,
or check register,
I don't care which one you use, I'm gonna show you write checks today,
what you do
is you go in, you select the bank account that you're paying it with,
if you're paying it online, you can actually just type in
online,
you can type in EFT,
you can type in your check number,
whatever it is
that however you want to say that you paid it,
the date that you paid it.
So let's say,
I'm gonna put online,
I'm gonna say, I'm gonna pay this January,
or not January, November 5th
of this year,
I'm gonna pay it to, Okay, so this is important.
When you're in the chart of accounts and you're creating your credit card,
you'll notice you have a credit card here, that's your chart of accounts.
When you're in and you go to pay it,
you have to add it again and it's just gonna be say Capital One
and they're a vendor. So if it's not already in here,
all act like I have to retype it and I'll type it slightly different.
You're gonna hit quick add,
vendor, and you're gonna click OK.
So if you're, if you're brand new, and you're paying your credit card for the first time,
your, your credit card
is gonna be
a vendor, and that's gonna be show your payments.
So let's say we owe $117, let's just say
we're only gonna pay $100 this month,
probably you just pay it off but
I'm gonna show you that, now.
One way you could do it is do your breakdown. But I'm not teaching you that today, because
really messes most people up,
I work with clients one on one and if you
ever want to work with me, feel free to contact me,
I do these YouTube videos, because honestly, I just enjoyed teaching.
But I've been doing it for eight years. So I work with clients one on one as well.
So
click on Capital One.
So the vendors who your paying,
Capital One
is the credit card, just to be clear
and then the amount, we're gonna pay $100
and I'm gonna write this off to business. So what I'm saying is,
I entered my charges,
I've reconciled it. So I know everything's done right?
Then I'm now gonna make a payment to my credit card, and it's gonna be $100.
Down the road, after I've reconciled they're two different things.
Okay, you're gonna pick the vendor,
the credit card who your paying
and you're gonna click Save and Close.
Now that's gonna show up here in your register under your bank account.
There's your payment,
the, what the blue line represents is that I'm paying in the future.
Anything above the blue line is
past, anything below the blue line is in the future,
because today is October 28.
Just in case you're curious.
So that just tells you I paid Capital One and it and the account that I'm picking
is my Capital One.
So now I'm gonna go under list, Chart of Accounts
and I'm gonna show you what's happened.
So now if I go back into the chart of accounts right here, list, Chart of Accounts,
you'll see my Capital One and now it says I owe $17.
So if you double click on that,
it'll open it up, and you can see what's happening.
So if you want to know when you're going in part of her question was
I'll go back to the YouTube,
you know, what's happening behind the scenes
and what happens, when we do partial payment,
I think I covered that pretty clearly
and how do you check your old transaction. So what you're gonna do
is you're gonna go in here and you're gonna look and you're going to see,
okay, I said when I entered this particular credit card charge,
just double click on it.
I said I paid it to Home Depot and the expense category, that's what you want here.
You don't want to select your credit card again, you want the expense
up here is going to the credit card.
Here is where the expenses.
If you hit Ctrl Y, it's just a little shortcut.
It'll actually show you also what's happening
in a little transaction journal.
What's going against your
expense and it's going against your credit card
So that's what's happening behind the scenes
the accounting wise, that's what your question was
and then when you go to pay it,
you pay in Capital One but it going towards your bank is what where it's coming from.
This is that, where it's going to and this where it's coming from
and you'll notice charges and payments, and now your balance is $17.
So QuickBooks will actually keep track of your balance as you go.
You just enter all your charges,
enter all your finance charges, reconcile it,
and then make your payments as you go along and make sure you're
coding in your check
right here to credit card, and you will be good to go.
So I hope that answered all your questions.
if this tip has benefited you,
and you know somebody else who could benefit from it,
please SHARE it
and if you enjoy my videos, don't forget to SUBSCRIBE and LIKE and like this video.
And as I said, I have a lot more
videos on
here on my YouTube and I put them on my blog on my website.
If you would like to work with me or
want some help on your specific business
with QuickBooks, feel free to contact me and let you know what that looks like.
Have an amazing day. Oh, I forgot one thing.
I love your questions.
It's the way I know what you guys need to learn and know because
I do QuickBooks all the time.
So if you have a question,
don't hesitate to ask me.
You don't need to share
your name or
anything about you.
I will not share that information, but I will give you your answers.
Have an amazing day. I'll talk to you guys again next week.
Bye.