entering credit card payments towards daily adjusting journal entries

mamadee · ‎February 09, 2024

How do I enter a payment on my account that was a credit card transaction? The original amount I posted as a daily sales AJE does not match, as the merchant fee (4%) needs to be accounted for.

Anonymous · ‎February 09, 2024

Let me share information about entering a payment on an account that uses a credit card transaction, @mamadee.

There are two ways to enter the merchant fees in QuickBooks Desktop. You can either:

Edit the Adjusting Journal Entry and insert the merchant fee
Create a separate transaction (Check) to record the fee

To edit a journal entry, here's how:

Go to the Company menu and select Make General Journal Entries.
Find and select the journal entry you need to edit.
To record the changes, select Yes.

I highly recommend consulting your accountant on what accounts to use when crediting and debiting for accuracy.

Meanwhile, here's how we can create a separate check:

Click Banking at the top menu.
Select Write Checks.
Select the affected BANK ACCOUNT.
Select the vendor in the PAY TO THE ORDER field if needed.
Under the Expenses tab, enter the merchant fee account.
Enter the amount and click Save & Close.

You can check out this link to learn how to get a financial snapshot of your business in QuickBooks: How to run and customize reports in QuickBooks Desktop.

If you have any further queries concerning entering payment, please leave a comment for us. We'll monitor your concerns and suggestions. Be careful at all times.

Rainflurry · ‎February 09, 2024

@mamadee

If you're adjusting the JE made for the daily sales, add a line to the JE and debit Merchant Fees. Then, reduce the debit entry to your bank account by the same amount. The deposit should now match and the reduction has been booked as Merchant Fees.

mamadee · ‎February 13, 2024

I am still struggling with this. Can you help me any further? Thanks!

Rainflurry · ‎February 13, 2024

@mamadee

Sure. If you can post an example of the journal entry (JE) that is used to record daily sales, that would help. The JE to record daily sales generally has a debit entry for the daily credit card payout (deposit). Let's say your daily cc sales are $1,000. There should be a debit entry to your bank account on the JE for $1,000. But, you need to account for the 4% reduction in the deposit for the merchant fees. So, you would decrease the debit entry to your bank account to $960 and create a new line on the JE for Merchant Fees expense for $40. That increases your Merchant Fees expense by $40 and reduces your payout to $960 so your bank deposit matches.

mamadee · ‎February 13, 2024

These are the AJE. I then post a payment. That is where I have trouble.

Rainflurry · ‎February 14, 2024

@mamadee

On the first JE, reduce your Card Receivables debit by $37.48 and add another debit line for $37.48 for Merchant Account Fees. Your Card Receivables entry is now $899.43 and that should match your cc payout. On the second JE, delete both the debit to Merchant Account Fees and credit to Card Receivables for $37.48 because the change to the first JE took care of that.

mamadee · ‎February 14, 2024

I agree with this- although the previous bookkeeper did it the way as shown above, and it has always worked. I am missing something along the way.

Thank you for your help.

Rainflurry · ‎February 14, 2024

@mamadee

With all due respect, the previous bookkeeper was not great with journal entries. A debit and a credit to both CC Receivables is redundant.

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entering credit card payments towards daily adjusting journal entries