Organizing or recording all our credit card payments can help us to maintain proper information about the money we have spent. Performing this process is not too difficult and cumbersome rather it is quite simple. The main requirement in this is that we have to possess a certified bookkeeper in which we can make the record of payments and along with it we have to reconcile our bank statements periodically so that the books can be updated and accurate.
How to record a credit card payment in QuickBooks?
The process of recording a credit card payment in QuickBooks comprises of four main steps.
These steps are listed below:-
Step 1. Check writing
For the purpose of recording credit card payment, we can also write a check. For this, follow the following steps:-
- Select New.
- Now select Check, written under Vendors.
- Type the name of credit card or vendor in the field, named payee.
- These types of Bank account or the credit card through which the payment is to be made in the field, named Bank Account.
- Type the check number in the field, named Check. If the payment is done electronically write EFT in this field.
- If the check is already issued, unpin and print later.
- Now provide the details related to category and the amount which is paid.
- Now save it and close.
Step 2. Organize a transfer
A transfer can be organized in order to record the credit card payment in QuickBooks. Follow the below-listed steps:-
- Select New.
- Select Transfer, written under Other.
- Now choose the name of the bank account whose credit card is being used to make the payment from the drop-down menu, named Transfer Fund From.
- Choose the credit card to which the payment is being sent from the drop-down menu, named Transfer Fund To.
- Now enter the amount that was paid.
- The date can be edited. It is not mandatory.
- Save it and close.
This might be not known to you that before entering the credit card payment, we need to reconcile our credit card. This process helps us to make this process easier and safe from errors.
Step 3. Reconciling the credit card
- Select Settings.
- Now click on Reconcile.
- Choose the account of credit card which we want to reconcile.
- Select the date of the statement of your credit card.
- Type the ending balance in the same way as it is written on the statement of the credit card.
- A box named with Finance Charge is provided to you. Enter the interest fees in it and date on which it is issued and then select the account that is used to categorize your account.
- Now click on the Continue button.
- After clicking the Continue button, a bank’s reconciliation screen is displayed where payments are shown on the right side of the screen and the charges and cash advances are shown on the left side of the screen.
- Analyze the reconciliation screen and click all the matching transactions.
- After selecting all the matching transactions go to the right-hand side at the bottom of the page and check whether the difference is written zero or not. If it is zero then everything is perfect otherwise there is an error and we have to find out the error.
- If the difference is zero, it implies that your credit card is balanced and click on Reconcile.
- Now a screen is displayed where “Write a check for the payment now” is written. After selecting that option, click “OK” or we can write a check afterward.
- After clicking on “OK” we receive a brief or detailed report of reconciliation that can be viewed or printed.
Step 4. Make credit card payments.
- Select the account through which you will pay the amount of your credit card charges i.e. payment account.
- Now select the actual credit card account in the field named Account. If you are redirected through the reconciliation screen then this field is already field.
- Now select the vendor to which you are making the payment using the drop-down menu.
- Enter the check number.
- Enter the date on which the payment was made.
- First, Enter the amount that was paid and if you are redirected from the reconciliation screen this field will be already filled.
- A memo can be created to describe the payment that was made. For example:- we can explain why the payment was made.
- After entering all the relevant information or details “Save it & close it” and if you want to write more checks click on “Save & New”.
- In the end, check your payment you have recorded.
In today’s scenario, everyone opts for a credit card for most of their payments. So, now they don’t need to remember the payments they have made. They can simply record them in the QuickBooks which can later be used to analyze their total financial expenditure and can easily plan for the future payments that can possibly make. This can also be preferred due to its easy and efficient nature. One of the above-mentioned steps can allow you to make the record of your credit card payments.