Hi gobubblenet. I’d like to share some insights on credit card payments and their impact on the Profit and Loss (P&L) report..
There are reasons why credit card payments do not appear on the P&L statement:
- Credit card payments do not appear on the P&L statement because they are balance sheet transactions, representing the repayment of a liability (the credit card balance) rather than income or expenses.
- The P&L statement is designed to show income and expenses over a specific period, not debt payments.
When you pay your credit card balance, it reduces your liability and does not impact the P&L. Only individual credit card transactions recorded as expenses appear in the P&L, while purchases like inventory do not impact it immediately.
To track your credit card payments and liabilities, I recommend running a balance sheet report.
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