Credit cards and Balance sheet

Hello there, BrandonPhoto.

I'd like to share with you some information about reconciling credit card account and balance sheet.

The amounts or balance showing on your balance sheet depends on the transactions entered to a specific accounts. When creating transactions from the credit cards you'll need to select the correct Expense accounts or Items.

A negative balance in Credit Card means that you have deposited amounts greater than expenses.

If you can let me know more about this, I would love to help you further. You have a wonderful day ahead.

When I make a credit to the main acct it comes in as a negative but will only go into an acct called main - other, which doesn't look right at all.  Maybe this image will help explain.
Thx

Brandon

Thanks for getting back to us, BrandonPhoto.

I appreciate the screenshot you've provided. Let me help you sort this out.

To better isolate this issue, you may want to check the transactions associated with the Chase CC 77 main - Other. Ensure that the account you used is not the main one, but one of the two sub-accounts.

You may find this article helpful: https://quickbooks.intuit.com/community/Help-Articles/Resolve-a-Balance-Sheet-out-of-balance-in-Cash....

This will get everything nice and organized in your QBO account once again. Should you need more help with your credit cards and balance sheet report, please let me know.

I hope I understand what this question is asking.  But if not, my answer should help anyone struggling with the initial setup of a credit card account in QB.  BE SURE TO SELECT CREDIT CARD ACCOUNT when setting up these accounts.  Do not select liability account.  Credit card accounts are their own liability account in QuickBooks. 

I am not an expert, but suspect many credit card accounts works like the ones I've dealt with.  They have a main account number, which is the one that your payments will show up in on your statement. Each credit card under this main account will have their own account numbers (usually only differing from the main account with the last four digits - which are the last four digits on each credit card). You will receive separate pages in your statement for each individual credit card. This is more typical for business credit card accounts, than personal credit card accounts.  Business credit cards separate charges by card number, so you can see what each person in your organization is spending. 

So the correct way to set this up in QB in your Chart of Accounts is to create a PARENT CREDIT CARD ACCOUNT, with each card being a sub-account, but also the "payment" account being a sub account.  

So my parent account is named "CC parent 1234". 

Each card subaccount is named "CC CHARGES 5678", "CC CHARGES 0987", etc. 

Then the payment account (which is the main account which receives payments) is named "CC PAYMENTS 1234".  Note that the four digits of this match your parent account, because your parent account and payment account is the same thing. The parent account is created to simply give the credit card charges and payments a place to reside together.

You could eliminate digits from your CC PARENT account and just name it "CC PARENT ACCT", if you want.  I add the digits, in case someone has multiple credit card accounts, possibly with different banks.  So just name with what makes sense.  You might want to name things with the bank name, if you have several.  Such as "CC CHASE PARENT", "CC CITIBANK PARENT", etc. I also shorten names and words to keep my account names as short as possible, so viewing them in screens is easier. (Just a side-note.)

In Banking in QBO, you will see your payment acct and each credit card as separate icons. Check off (Add or Match) items in banking, as usual.

When you reconcile the credit card account in QBO, you will only reconcile the PARENT account.  All charges and all payments from your subaccounts will be together in the parent account.  You will not do any reconciling in the subaccounts.  

I hope this helps some of you.  It's hard to type things in a way that makes sense. 

Hi NBR,

I tried to send you a message but it didn't work. The screenshot that was provided to you is exactly how it looks on my QB's desktop. Can you tell me how to fix it in QB's desktop? I have a post but no one is telling me the proper way to do it and I can tell by what you said to the original post that you would know what I need to do so that the sub-account will not show a balance. 

I hope this message finds you well, Renee. I'd be delighted to provide more details about your credit card concern today. 

To ensure that I give you the most accurate information, can you provide me a screenshot of your chart of accounts? Is it also showing a negative number? It'll help me to assess the situation more effectively and give you the best possible advice.

I would be grateful for any further information you can provide. It would be my pleasure to assist you once more. I hope you have a great day.

Hello!

I have the same issue.  Can you please share on how to resolve this? we have 11 credit cards to include the main account.  the COA has a credit balance under the main account, in the balance sheet, there are debit balances in all sub accounts with a credit balance under the main.  

Hello!  

Can you please share on this issue.  We have 11 credits cards to include the main.  I provided a screen shot of the Balance sheet and Chart of account.  

Let me guide you on how to correct your credit card balance, @rdjune.

I see from the screenshot that you're using QuickBooks Online. There are a few ways to resolve your credit card balance concern, and I'm here to help you fix this. 

If you're using the pay down credit card:

1. Go to + New, then select Pay down credit card.
2. From the Which credit card did you pay? Make sure to choose the sub-account instead of the parent account.
3. Type in the correct amount in the How much did you pay? column. 
4. Enter the date of payment. 
5. Once done completing all necessary fields, click Save and close. 

If you're using the check or expense: 

1. Go to + New, then select Check or Expense
2. Complete all necessary fields
3. Make sure that you choose the correct sub-account in the Category details column.
4. Once done, click Save and close. 

If you wish to use the Journal Entry, I recommend consulting your accountant for advice in selecting an account and ensuring the accuracy of books. If you don't have one, you can find a professional through this link: https://quickbooks.intuit.com/find-an-accountant/.

When using the journal entry, please remember to enter the correct amount in the Debits column for the parent account and Credits for the sub-account. 

Now, you can generate your balance sheet report and customize it. Customizing will help you to get a more detailed and relevant picture of your business data as it filters specific accounts or customers. Once done customizing, you can export and memorize  it to save its current customization settings. 

Please know that you can still reach out to me if you need further assistance managing your credit card account balances. Just type in your response by tapping the reply button below. 

Thank you!

This is an issue that was inherited.  The parent account credit balance is ongoing until I can get to fixing it. Can you give me a small example of what the balance sheet should look like based on the screen shot of the balance sheet? 

Hello ShyMae

In the Balance Sheet, we have several credit cards under the parent account (5919).  Currently, YTD there is a credit balance under the Parent Account (which is reconciled each month) it also includes 2022 balance.  The other cc accounts have a debit balance which are also running totals form last year (?).  From what I understand in QBO, the CC is its own account in the Balance Sheet but since we reconcile and pay it in full each month, aside from the current months unreconciled/unpaid transactions, Should there be a balance in the previous reconciled & paid periods? 

We have some payments categorized under the parent (which is also 5919) and some categorized under the Main R. Gonthier (5919) sub-account.  Which is correct? Also, we have the 5919 connected as a feed (should it be connected or not?) 

Thank you for getting back with detailed information concerning bank accounts and balance sheet reports in QuickBooks Online (QBO), @rdjune.

Let me start by addressing them one by one so we can get things sorted out. To begin, the Balance Sheet report is a financial snapshot of your company showing cumulative data that carries a beginning balance. Regardless of what range of data you selected from the report it will still show the cumulative total of the account.

Based on the screenshot, I can see that your Balance Sheet report didn’t match with your bank register. Worry less. Normally, the report doesn’t match especially if your company's fiscal year is different from the calendar year.

The amounts on both the report and the register may not match because the balance sheet is run on a calendar year. You can resolve this issue by using one of the options listed in this article. You can directly refer to Why the Balance Sheet report may not match the register section: Run a Balance Sheet report in QuickBooks Online.

In connecting online banking to your QBO, there are certain ways we need to consider. Thus, you’ll need to know how your bank sends the downloaded transactions. If the transactions download to one account, connect only the parent account. If the transactions download to the individual accounts, connect the subaccounts and not the parent account. You can’t connect both as it will result in an error.

Moreover, if your sub-accounts have balances please make sure to select the sub-accounts instead of the parent account when entering payments. The process will zero out the balances, including the parent.

When it comes to reconciling them, you only need to reconcile the parent account because all transactions in the sub-accounts roll up into it.

Furthermore, you’ll want to consult with your financial advisor to double-check if your transactions are posted or categorized to the correct accounts. Also, to avoid any discrepancies in the future.

In addition, you can look at these articles for information on classifying transactions and account reconciliation. By doing this, you'll ensure that your transactions are classified correctly and prevent inconsistencies in your books:

• Categorize and match online bank transactions in QuickBooks Online
• Reconcile an account in QuickBooks Online
• Fix issues at the end of a reconciliation in QuickBooks Online

We want to continue serving you better in the future, and please know that your satisfaction is our topmost priority. Please leave a message if you have any more banking-related queries or other QuickBooks-related matters. Take care!

Hello RoseJillB

I guess I am a little confused on this system function: 

In connecting online banking to your QBO, there are certain ways we need to consider. Thus, you’ll need to know how your bank sends the downloaded transactions. If the transactions download to one account, connect only the parent account. If the transactions download to the individual accounts, connect the subaccounts and not the parent account. You can’t connect both as it will result in an error.

We have each account set up as a sub-account and from what it looks like, each sub-account is connected to the parent? 5919 is the Parent account and is also set up as sub-account (see print screen).  the owner uses this account.  Since you mentioned we cannot connect both parent and sub-account.  If we disconnect the sub-account where will the transactions download to?

From the print screen, is the set up correct? 

Thank you for providing further information, rdjune. We appreciate the opportunity to address any additional questions you may have.

I'd like to join and provide clarification on how online banking functions when parent accounts and sub-accounts are in play.

The typical method for setting up a bank account or credit card account that includes multiple associated cards is to establish a parent account and then create subaccounts for each card under it.

Based on the information shown in the screenshot, it appears that the account ending in 5919 was set up as a sub-account under the Chase CC Parent account.

If you choose to disconnect this specific account, the system will download transactions under the Chase CC Parent account.

If you want to make 5919 a parent account, uncheck the box for Is sub-account. Now, if the transactions download in this account, keep it connected to Online Banking and disconnect the sub-accounts. This way, all transactions from the sub-accounts under it will show up in 5919. 

You can also take a look at the screenshot below for additional reference:

If the transactions download to the individual accounts, connect the subaccounts and not the parent account.

Please take note that during the reconciliation process, you only need to focus on the PARENT account. All the charges and payments made from your subaccounts will be consolidated in the parent account. In other words, the sub-accounts underneath simply display transaction details. As a result, it's also unnecessary to reconcile the subaccounts separately. 

Here is an article that offers detailed information about setting up bank or credit card subaccounts: About Bank or Credit Card Subaccount Setup.

For additional resources and guidance, I'll share these banking-related articles as well:

• Exclude a Bank Transaction You Downloaded Into QuickBooks Online
• What To Do If You Get A Bank Error Or Can't Download Transactions in QuickBooks Online

Thank you again for those details, rdjune. Please keep posting follow-up questions with added bits of insight anytime something still feels uncertain. I am here to provide ongoing support and ensure that everything is resolved smoothly while working in QuickBooks Online.