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dyannereed
Level 1

Reconciling credit card accounts

I have never reconciled my cc account.  Can I start now and "ignore" the past entries? AND  Does this affect the P&L and or Balance Sheet? 

9 Comments
Joesem M
QuickBooks Team

Reconciling credit card accounts

Welcome to the Community space, @dyannereed.

 

Yes, you can now start reconciling and ignore those past entries. Since it's your first time reconciling an account, you can pick a day to start tracking transactions and enter the balance of your real-life bank account for whatever day you choose.

 

  1. Select Reconcile in the Banking section.
  2. Click the Account drop-down menu, and then select the credit card account under Credit Cards.
  3. The Statement Date is automatically filled in. Usually, it's 30 or 31 days after the statement date of the previous reconciliation. Change it as needed to match your bank statement.
  4. QuickBooks also automatically enters the Beginning Balance.
  5. In the Ending Balance field, enter the ending balance as it appears on your bank statement.
  6. If your bank statement shows a service charge or interest that you didn't enter into QuickBooks, don't worry. Enter the amounts in the Service Charge and Interest Earned section. Don't enter charges you've already entered in QuickBooks.
  7. Review the fields and select Continue to start reconciling.

 

See this article for detailed steps: Reconcile an account in QuickBooks Desktop.

 

Also, it doesn't affect your Profit & Loss and Balance Sheet since you haven't reconciled your account. However, I'd still suggest consulting your accountant. They can guide you on how to handle your reconciliation to ensure your book is accurate.

 

 

In case you encounter some issues upon reconciling. This great resource will surely help you with fixing it. For the details, please check out this article: How to fix reconciliation issues in QBDT?.

 

Once done with your reconciliation, I'd suggest customizing your reports. This is for you to get the details you'll want to pull up. This is made possible through this article: How to customize reports in QBDT?.

 

Hit the Reply button if you have more questions about account reconciliation or any concerns in QBDT. I'd be glad to assist you further. Take care.

Paddy7
Level 1

Reconciling credit card accounts

I'm new to this forum and have tried a few times now to ask my question.  As I don't see it listed and I keep getting asked to sign in and change passwords, I'm hitting reply here as my question is along the same line. I hope this works!  I've made entries under Banking/cc entries.  The entries are shown in the P/L statement. I'm wondering why they are not reflected on the BS/chequing balance.  I thought the answer might have something to do with reconciling but in reading above I see that reconciling doesn't affect the P/L and BS.  That is my first issue and 2nd I'm wondering what the reconciling process does and do I need to do?    Thanks!

Rose-A
Moderator

Reconciling credit card accounts

I'd be glad to share some information about the importance of reconciling your accounts in QuickBooks Desktop, Paddy7.

 

Reconciliation is used to ensure that the money leaving an account matches the actual money spent. This is the only way you can be sure that all of the transactions that occurred got recorded in QuickBooks. Doing so will help you ensure the accuracy of your financial records.

 

To know more about this process, you can read through this article: Reconcile an account in QuickBooks Desktop. It provides in-depth details on how it works in QuickBooks as well as links to help you resolve reconciliation issues. 

 

On the other hand, to ensure the cc entries are showing on your balance sheet report, make sure that the date range entered includes the date of the transaction.

 

 

I recommend customizing the report to get the specific details you need. You can also memorize it to save its current customization settings. It serves as your record and helps you quickly access it for future use.

 

I'll zip right back to you if you need additional assistance with reconciling your account or anything about QuickBooks reports. I'm always here to help. Have a good one.

Paddy7
Level 1

Reconciling credit card accounts

Thank you very much Rose-A, for your reply. Not sure that my previous reply was sent.. or if this same next question went through..

I want my cc total to be not shown as a Liability in BS, and to be deducted from chequing account under Assets. I don't know how to show payment of the cc total as the cc charges have all been posted under the appropriate accounts and are reflected in the P/L statement.

Under Chart of Accounts I changed the cc type to Bank.  Now the cc totals are not shown as Liability and are now show as a negative under Assets.. still not deducted from Chequing balance.

I opened a cc post and when I tried to close the window I get this error message: "This account is the wrong type for this field. Please enter a different account of the appropriate type for this field." And i can't close this cc posting.

When I go back into Chart of Accounts and try to change the Bank type back to CC it won't let me do that either.  "can't change a Bank type.."

Can you help?!   thanks 

 

MaryJoyD
QuickBooks Team

Reconciling credit card accounts

I can share some information with updating account types in QuickBooks, @Paddy7

 

In order not to mess your account, I highly suggest you check with your accountant before making any changes to your account types. 

 

Please take note of the following restrictions before updating the account type:

 

  • Accounts receivable (A/R) or accounts payable (A/P) accounts can't be changed to other account types, and other account types can't be changed to A/R or A/P accounts.
  • You can't change the type of an automatically-created account, such as Undeposited Funds or Sales Tax Payable.
  • If an account has subaccounts, its type can't be changed. You may be able to resolve this problem by dragging each subaccount to a new location.

 

Here's an article that'll further guide you in managing your company's accounts using QBDT: Learn about the chart of accounts in QuickBooks. It includes topics about adding or editing accounts and hiding or deleting them in the account. 

 

Let me know in the comments below if you have other concerns about managing business accounts and transactions in QBDT. I'm just around to help. Take care always.

Paddy7
Level 1

Reconciling credit card accounts

Thanks MaryJoyD, I understand now that I shouldn't change account types.  The window showing the 1st item that I opened after changing acc types is still showing the error message and I can't close the window or change the account type back.

I read the links that you sent and I couldn't find an answer to my problem or question.. and my accountant is out of commission until May :(

How do I show that the cc charges have been paid, ie. how I wrote myself a chq for the cc total?

I tried "Write a Cheque to myself but that only doubled the "-" amount.

I went to "Select Bill to Pay" but it doesn't show the cc account to pay.

I'm hoping that by getting a cc "0" balance that it will rectify the problem of the stuck window.

This all started when I changed the cc account type to "Bank".  It won't let me change it back.

Thanks for any help you can provide.

LeizylM
QuickBooks Team

Reconciling credit card accounts

Thank you for getting us back here on the Community page, Paddy7. 

 

I know how important it is to keep your books accurate in the running of your business. QuickBooks Desktop enables you to set up, use, and pay your credit card accounts when needed. 

 

Here's how:

 

  1. From the Company menu, select Chart of Accounts.
  2. Select Account or the plus icon, then New.
  3. Select Credit Card, then select Continue.
  4. On the Add New Account window, enter the credit card name.

    Note: If you are setting up a sub-account, select the Subaccount of a checkbox, then select the parent account from the dropdown.

  5. Select Enter Opening Balance... then enter the account's balance and date.
  6. Select Save & Close.

 

After you reconcile the credit card account, there are 2 options to pay a portion of the outstanding balance:

 

 

I hope that helps! You know where to find us if you need anything else. 

 

Paddy7
Level 1

Reconciling credit card accounts

Thank you for the detailed process.  I already have the cc account set up.  I tried to write a cheque to myself.  I'm not sure which expense account to put it under so I put petty cash.. but that only doubled the negative amount.

I haven't reconciled before.  Do I have to reconcile or can I avoid this step?  I have other checks and balances to ensure the amount balances.

Also, there are no subaccounts.

Thanks!

Angelyn_T
QuickBooks Team

Reconciling credit card accounts

Hi Paddy.

 

I'm here to share with you some additional information about reports and reconciliation in QuickBooks Desktop.

 

When writing a check, you need to pick or use two accounts. A bank or credit card account where the funds are coming from. And, the expense account where you can track your expenses. If you're uncertain of what account to pick, I recommend seeking assistance from your professional accountant. They are the ones who can guide you with choosing the correct accounts and keep an accurate balance of your account.

 

Each transaction is posted in your reports accordingly. Your income and expenses are added to your Profit and Loss report. Your assets, liabilities, and capital or equity are posted to your Balance Sheet.

 

On the other hand, you need to reconcile your account to match the balance between QuickBooks and your real bank or credit card statements. For your guide, you can open this link: Reconcile an account in QuickBooks Desktop.

 

If you have any other additional questions about your checks and reconciliation, please let me know by adding a comment below. I'm more than happy to help. Have a good one!

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