Learn the steps to create a Journal Entry in QuickBooks Online
Often the QuickBooks users enter the accounting transactions incorrectly into an accounting system, and when this happens, the users are required to make changes to the original transaction even after been recorded, and this can be easily done in QuickBooks accounting software, by simply creating a Journal entry. QB users can make journal entries in QuickBooks Online in a straightforward manner. QBO feeds the transactions in the register/account history as journal transactions. In this article, we will be discussing the entire process of making a journal entry in QuickBooks Online. So keep reading on!
In case the user is looking for expert assistance, he/she can get in touch with our support team by dialing our toll-free number i.e. 1(844)521-0490, and our team will ensure to provide the finest possible service, round the clock.
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What is a Journal Entry?
Before digging in deep and exploring the process of making a Journal entry in QuickBooks Online, it is better to first understand what Journal Entry is. Basically, a journal entry is an account transaction, which is posted or entered to the general ledger. Journal entry consists of two parts, mainly debit and credit, and it is a rule that the total of both debit and credit should tally. The general ledger of a company act as the main group of accounts that are used to record the balance sheet and income statement transactions. The user can make use of the journal entries, when he/she needs to:
- Send money between income and expense accounts
- Transfer money from an asset, liability or an equity account
- Also, if the user needs to enter the debit and credit in general journal or the ledger
Important Rules to make journal entries
- The user should not make journal entries to inventory or payroll accounts
- Also, the user needs to include one account receivable or accounts payable type account every entry
- Moreover, it is important to use accounts receivable or accounts payable account on the second line of the journal entry
- Also, entry to accounts payable type or the accounts receivable will need a customer or vendor
Mark these points while creating the Journal Entry in QuickBooks
- QuickBooks Online doesn’t support Multi-currency in a single Journal entry. Therefore, each and every currency has its own Journal Entry.
- If by chance, the user creates an entry, and the user wants to rectify the transaction, it can be done by deleting and reversing the Journal Entry.
- The user is required to view the additional column for the location and class if the user is using the QB Online Plus.
- In order to reflect on sales or expense tab, the user needs to ensure that entry has a line for either A/R or A/P and also the vendor or customer name
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When to use Journal Entry in QuickBooks online
The user should make use of the journal entry in QuickBooks online only when:
- The user can make use of journal entry in QuickBooks online, while sending money between income and expense accounts
- Also, to transfer money from an asset, liability, or an equity account to the income or the expense account
- In case the user needs to enter debits and credits in general journal or the ledger
Steps Involved in Creating a QuickBooks Journal Entry
Step 1: Move to the journal entry feature
The very first step in the process of crafting a journal entry in QuickBooks is to navigate to the journal entry feature, Clicking the plus icon i.e. (+) at the top right of the file, will show a drop down menu names as “Create” in which the option for “Journal Entry” would be seen. Once you will click on that option, it will redirect you to the window where you will have to fill in the required information.
Step 2: Enter date and journal number
The Journal entry form in QuickBooks online is quite simple. Once the form the is opened up on the screen, the user will have to edit the journal date, as the current date will be entered automatically in it by QuickBooks. In case you are recording any entry from any other date, make sure to correct the date before proceeding further. After correcting the date, the user will have to fill in the journal number, or else QuickBooks will automatically enter the sequential number.
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Step 3: Enter the required information
- Accounts: From accounts, the user meant the accounts in the chart of accounts.
- Journal code: The user is then required to fill in the Journal code related to the account. Entering New Journal Code is of much importance. The user should keep in mind that he/she is required to use the same Journal Code that is related to the transaction for the debit and credit accounts.
- Debits or Credits: The user can search for the transactions in a recent transaction report, and also it should be noted that the first in line is Debits. Also, check out if the debit has changed after the transaction has been saved.
- Description: The user is required to enter a description to check the transaction details on the Reports.
- Name: After that, select the customer, employee, or vendor.
In case the total of the debit column entries doesn’t match the sum of credit column, then the user is required to continue to fill in the distribution lined until the total of both transactions is equal.
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Step 4: Choose to make recurring Journal entry schedule
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- And finish the process by saving the transaction.
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Winding up
Creating Journal entries in QuickBooks online is not a huge task that can’t be performed by the QB users. By following the above-enumerated steps in the correct sequence, the user will be able to make journal entries in QuickBooks Online without any hassle.
In case you have any query or face any difficulty, simply dial our toll-free number i.e. +1-844-521-0490 and our QuickBooks enterprise support experts will provide you with round the clock assistance in a single call.
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