I feel I am missing something basic about how account transactions are recorded and reconciled. I have two Accounts, Paypal and Credit Card. Normally an expense shows up in Paypal, then has a matching transfer from CC to fund it. I end up with 1 expense, 1 transfer.
In this case I have a record of transfer of $41.92 from CC to Paypal and reconciled it in CC.
This also creates a record of transfer in the PayPal register of $41.92 transferred in from CC.
When I go to reconcile PayPal, I see an error was made. This was not a PayPal expense. The payment should have gone directly from credit card to vendor.
1. What is the proper way to handle this moving forward?
What I did was delete the record from the PayPal register. Expected behavior was that it would just disappear. Instead, the record disappeared AND added a cleared balance of 41.81, throwing off the ending balance by -41.92. What happened here? If the record was deleted, it should not have affected the PayPal account at all.
Meanwhile in the CC register, my starting balance for the current month has decreased by 41.81. This makes sense as there is an extra $41.81 that needed to be spent from the previous month. In the past I would unreconcile this month, enter the correct record and move on. However QBO ( vs desktop ) seems to undo far more than I expect when I unreconcile, so do not wish to do that. Also, since I do not see a way to save and restore backups, I can not comfortably experiment to find the correct answer.
What is the proper way to address this? If I add a corrected record ( expense in CC instead of transfer ) expected behavior is that the CC register balance would be correctly adjusted. However, this does not resolve the mystery cleared transaction in PayPal.
Is this something I should be correcting with a Journal entry? If so, how would I set that up.
Thank you in advance!
