Record A Journal Entry In QuickBooks

Publié le 24 décembre 2020

Just how to Record a Journal Entry in QuickBooks Online

How to Make a QuickBooks Journal Entry in 5 Steps
Navigate into the journal entry feature in QuickBooks Online.
Fill in the date and journal number.
Enter the correct accounts into the “Category” column.
Go into the debit and credit amounts before the entry is balanced.
Add a description and save.

Managing your business’s accounting can be complicated—even utilizing the assistance of accounting software like QuickBooks. This being said, even although you outsource your bookkeeping or accounting, it’s often helpful to understand how some basic features work. If you’re using QuickBooks Online, perhaps you are unclear on the best way to make a journal entry. A journal entry, as a reminder, is a transaction that is entered straight to your business’s general ledger. So—how do you realy make a QuickBooks journal entry?

We’re here to break it down. We’ll show you the five simple steps you can follow to Record A Journal Entry In QuickBooks Online and get a leg up on managing your accounting processes.

What exactly is a QuickBooks Journal Entry?
First, let’s clarify just what a QuickBooks journal entry is. Generally, QuickBooks will automatically record transactions because they occur—you’ll record an invoice, sales receipt, bill, check, etc.—and QuickBooks will pull this data into the general ledger.

However, should you ever want to enter a transaction manually, choose to correct an error, as an example, you’ll would you like to utilize the journal entry feature within QuickBooks Online. When you post a journal entry in QuickBooks, or in some other accounting software, it should balance—any debit you create must have a corresponding credit and vice versa.

For example, as you’ll see below, if you’re recording a journal entry for a check you wrote for a year’s worth of insurance, you’ll need to list a debit to the insurance account and a credit to your bank account.

Just how to Record a QuickBooks Journal Entry
Because of the basics at heart, let’s break down exactly simple tips to record a journal entry in QuickBooks.

Once we mentioned, we’ll be using “prepaid insurance” in this example.

Step 1: Navigate to the journal entry feature.
Step one is simple—you’ll need to navigate towards the element of your QuickBooks Online software that enables you to post journal entries. If you click the + icon at the top right of the file, you’ll see a dropdown menu called “Create” that lists “Journal Entry” within the farthest column from the right-hand side.

Once you’ve clicked “Journal Entry” you’ll navigate to the entry itself to fill in the mandatory information.

Step two: fill out the date and journal number.
As you possibly can see below, the journal entry form in QuickBooks on the net is fairly easy. Once you’ve brought up this form, you’ll like to first edit the journal date. QuickBooks will automatically pull in the current date, so if you’re recording a journal entry from a previous month or day, you’ll would you like to make sure to enter the correct date.

Next, you’ll like to fill within the journal number. In this example, the journal number is 151—QuickBooks will automatically number any new journal entries sequentially following this number (or in other words, the following you might be 152).

Step 3: go into the correct accounts within the “Category” column.
In this example, we’re creating a journal entry for prepaid rental insurance. Because rental insurance is frequently prepaid for 30 days or per year, it is considered an “other current asset” to start out, but needs to be expensed out once the year continues on, monthly. This being said, you can book the prepaid asset using a check, but you can use a broad journal entry as well.

With this thought, we’ll be adding two accounts in the category column. The initial account, from your chart of accounts, may be the “Company bank account.” Here is the account which is losing the cash whenever you pay money for your rental insurance. The second account, on the other hand, could be the “Prepaid Insurance Account.” This is actually the account which will be gaining the amount of money you’re using to prepay for the insurance for the year. In just about any QuickBooks journal entry, there will continually be two accounts, one to credit and one to debit.

Step 4: Enter the debit and credit amounts.
Once you’ve pulled the best accounts, you’ll fill out the corresponding debits and credits. As you care able to see, rental insurance costs $1,200—so you would add a credit towards the bank checking account and a debit to your prepaid insurance account.

By the nature of a journal entry, you’re impacting your books, in other words, the typical ledger. However, it is also essential that a journal entry is definitely balanced. The debit column needs to balance the credit column, no matter what many lines the entry is. Therefore, if you were listing multiple payments through this one entry, you would have to make certain that the debits and credits were equal at the end of the entry.

Step 5: Add a description and save.
The final step needed to complete your QuickBooks journal entry would be to add a description. As you can plainly see inside our example above, the description explains that this journal entry is prepaying for rental insurance. Once you’ve filled in the description, you’ll save the journal entry and close it.

Ultimately, it’s quite simple to record a journal entry in QuickBooks Online. This being said, a QuickBooks journal entry could very well be the clearest illustration of double-entry accounting—when something is debited, something different is often credited. In this way, every transaction within QuickBooks can be looked at like a journal entry.

A client invoice, for example, debits accounts receivable and credits revenue. A vendor bill, on the other hand, credits accounts payable and debits the cost of goods sold or expenses. In this manner, it doesn't matter what transaction you get into QuickBooks Online a journal entry is being conducted behind the scenes.

How Transactions Post in QuickBooks Online
Even as we stated earlier, QuickBooks typically pulls the information essential to add a transaction to the general ledger automatically. If this occurs, a journal entry is actually happening behind the scenes. Let’s take a look at how that works well:

If, as an example, we had taken care of the rental insurance using a check, you would enter that check as a result:

To see the process that occurs when you enter this look into QuickBooks, it is possible to click on the “More” tab in the bottom after which “Transaction Journal.”

quickbooks journal entry

When you click on the transaction journal, you can observe the automatic “journal entry” that’s happening behind the check. As you’ll see below, the Check adds a credit of $1,200 to the checking account and a debit of $1,200 to the prepaid insurance account—just once we completed in our example above.

quickbooks journal entry

Simple tips to Create a Recurring Journal Entry in QuickBooks Online
So, within our example above, we credited the company bank account and debited the prepaid insurance account, however, because we prepaid for a year of insurance, you may be wondering simple tips to actually expense out this cost, monthly, as the year goes on.

To do this, we would create another journal entry. In this situation, we’d fill out the exact same information, but alternatively of crediting the checking account, we’ll credit the prepaid insurance account and debit the specific insurance expense account.

quickbooks journal entry

As you care able to see, for the month of January, this journal entry just took $100 (1/12 associated with the total payment) through the prepaid insurance asset account and moved it to your actual insurance expense account—meaning it had been moved through the Balance Sheet into the Profit and Loss. You would perform this journal entry on a monthly basis and that can automate the process by simply making it “recurring.”

To achieve this, you’ll click on the “make recurring” text in the bottom of the journal entry. Now this same journal entry will repeat each month through the end of the season.

quickbooks journal entry

This being said, you can also start from the Recurring Transactions list underneath the Gear Icon at the upper-right corner of this QuickBooks Online file, and create this repetitive journal entry this way as well.

quickbooks journal entry

In this instance, you would click “Recurring Transactions” and then “Select New” and finally, choose “Journal Entry” from the Transaction Type drop-down menu:

quickbooks journal entry

As shown below, this may pull up a “Recurring Journal Entry” form where you’ll be able to fill out the same information as we illustrated when you look at the example above. You’ll credit the prepaid insurance account and debit the insurance coverage expense account and indicate that this entry should recur monthly. You may want to choose a start date and a finish date.

We hope this short article be worthy and beneficial to discover ways to Record A Journal Entry In QuickBooks. If you wish to discover more help and best support from professional experts, dial QuickBooks Support Phone number anytime.