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How do you record interest charges for credit cards?

I just started using QB and have not signed up for Online Banking until I become more familiar with the product.  I need to know how I can enter credit card interest charges so I can reconcile my credit card.

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Best answer 12-10-2018

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Established Community Backer ***

Enter credit card charges, assign your expense account. O...

Enter credit card charges, assign your expense account. Or use the service charge field when you reconcile the account.

10 Comments
Established Community Backer ***

Enter credit card charges, assign your expense account. O...

Enter credit card charges, assign your expense account. Or use the service charge field when you reconcile the account.

Community Contributor *

Re: Enter credit card charges, assign your expense account. O...

Where is the service charge field?  The only fields I have are Beginning Balance, Ending Balance and Ending Date.

 

*Edit:  Sorry, my question is about QBO.  I just saw this was desktop.

Moderator

Re: Enter credit card charges, assign your expense account. O...

That's not a problem, @jesserain.

 

I can help you locate the service charge field when reconciling in QuickBooks Online (QBO).

 

When you reconcile an account in QBO, you can locate the service charge field at the bottom of the Reconciliation Window.

 

Here's how:

 

1. Click the Gear icon at the top, then pick Reconcile under Tools column.
2. On the Reconcile an account window, you'll see the Service Charge field under Enter the service charge or interest earned, if necessary.

 

You may also refer to the sample screenshot below.

 

 

That's it! I hope that this response finds you with a smile. Please don't hesitate to post again or leave a comment below if you have any follow-up questions. I'm always here to help. Have a great rest of the day.

Not applicable

Re: Enter credit card charges, assign your expense account. O...

Hi @FritzF, I was wondering if you could help me.  I have QBO and I don't seem to have the same type of window that you have when reconciling my credit card account (your picture below).

 

 

 photo 1.jpg

Below is what my window looks like when I hit "reconcile."  How do I get to your type of reconciliation window?

 

 

 photo 2019-01-13_9-35-15.jpg
QuickBooks Team

Re: Enter credit card charges, assign your expense account. O...

Hello there, Rai1.

 

For accounts connected to online banking, the Service Charge, Interest Earned, and Finance Charge (credit cards) fields do not appear. This is because these entries are downloaded automatically from your bank. 

 

If the account that you're reconciling is connected to your bank, then proceed with reconciling it.

 

Please let me know if you have more questions.

Not applicable

Re: Enter credit card charges, assign your expense account. O...

"continue reconciling" doesnt help with the interest charge. my reconciliation will be off. how do we add interest when theres not fields to enter it? we cant enter it as an expense as it doesnt show on hte line items

QuickBooks Team

Re: Enter credit card charges, assign your expense account. O...

Glad to have you back, @Troni!

 

You can post your interest charge to your interest expense account. Let me help you enter it to your QuickBooks Online.

 

First, you can enter it as an Expense transaction but not under the Item details. Instead, you'll post it to your Interest Expense account. 

 

Let me show you how:

  1. Go to the Plus icon.
  2. Under Vendors, select Expense.
  3. Choose a Payee, a Payment date, and a Payment method.
  4. From the Payment account drop-down menu, select the bank account you're reconciling.
  5. Under the CATEGORY column from the Category details, choose your Interest Expense account.
  6. Enter the amount of the interest charge.
  7. Click Save and close.

Once completed, you can continue reconciling your account. In addition, I've included a screenshot below for your visual reference.

 

 

Feel free to hit the Reply button below if you have any other questions about interest charges. I'll be happy to help you further.

Super Explorer *

Re: Enter credit card charges, assign your expense account. O...

jonpril_L,

Hello,

I was just reading about entering interest and credit card finance charges and your response prompted a question for me.

I have just set up 2 loan liability accounts and made sub accounts for the interest underneath them... as other liability and loan payables.

Should I be recording these to an Expense loan interest account under the PARENT Interest Paid account that came with the templated COA instead of sub accounts under loan payable/liabilities area?

Or do I just leave as is for the recording of the 'debt' there and then create the Interest Paid sub account for each loan under Expenses?

Sorry, very new to accounting and QBO.

 

Thanks so much!

QuickBooks Team

Re: Enter credit card charges, assign your expense account. O...

Thank you for joining the thread, @sicilianmissy6583.

 

I'd be glad to help share ways so you'll be able to record your transactions correctly.

 

If you're paying the interest on time, you can just create an expense transaction using the Interest Expense account. However, if you're paying it on a later time, you can create a journal entry debiting your Interest Expense and crediting your Interest Payable. Once you'll be paying the interest, you can create an expense transaction using the Interest Liability account. You can also make the Interest Payable Liability as a sub-account of the loan account if the interest is being incurred by the loaned money.

 

On the other hand, I'd also recommend consulting with your professional accountant for the accuracy of your accounts.

 

Please keep me posted if you have any other QuickBooks or entering interest and credit card charges questions by adding a comment below. I'll be always here to help you!

Super Explorer *

Re: Enter credit card charges, assign your expense account. O...

Thank you very much!

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