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How to Record a Journal Entry in QuickBooks Desktop and Online

Journal entries are an essential accounting tool used to

Journal entries are an essential accounting tool used to record financial transactions in QuickBooks Online. They provide a way to manually adjust account balances, record non-standard transactions, and maintain accurate financial records. Journal entries list vital data, such as how much was credited and debited, when, and from which accounts. Each journal entry corresponds to one discrete business transaction and is eventually posted to the general ledger. They can also be used to transfer money between an income and an expense account or transfer money from an asset, liability, or equity account to an income or expense account.

What is a Journal Entry in Accounting?

In simple terms, Journal entries are entries often used to capture complex transactions that don’t fit neatly into the standard invoicing or expense categories. For instance, adjusting entries for accrued expenses, recording depreciation, or recording payroll. 

Each journal entry includes the data significant to a single business transaction, including the Date, the amount to be credited and debited, a brief description of the transaction and the accounts affected. It may list affected subsidiaries, tax details and other information depending on the company.

Journal entries are the foundation of effective record-keeping. They are sorted into various charts of accounts and, once verified for accuracy, posted to the general ledger, which feeds information related to the financial reports. 

Accurate and complete journals are essential for the auditing process, as journal entries provide detailed accounts of every transaction. Auditors, both internal and external, will look for entries or adjustments that lack the proper documentation, explanations, or approvals or that are outside the norm for the business.

Journal entries are usually made in chronological order and follow the double-entry accounting system, which means each will have both a credit and a debit column. Even when debits and credits are linked to multiple accounts, the amounts in both columns must be equal. 

For instance, say a company spends $277.50 catering lunch for employees. The expenses account increases by that amount, while the cash account, which is an asset, decreases by $277.50 because that money has now been spent.

Why do you need to Record Journal Entry in QuickBooks?

How to Record a Journal Entry in QuickBooks

There are different kinds of reasons behind creating journal entries in QuickBooks, which are as follows:

  • Transfer money between income and expense accounts
  • Enter debits and credits manually, like in traditional accounting systems
  • Transfer money from an asset, liability, or equity account to an income or expense account. 

Record a Journal Entry in QuickBooks Desktop

Journal entries are often used when you need to capture complex transactions. They let you move money between accounts and force your books to balance in specific ways. You are recommended to use them only if you have enough knowledge of accounting or you’re following your accountant’s advice. For better clarification, you also need to understand the debit and credit standards. 

Below we’ve discussed how to record a Journal Entry in QuickBooks Desktop.

Let’s get started:

Add a journal entry

If you want to create a new journal entry, here’s what to do:

  1. Navigate to the Company menu and then choose Make General Journal Entries.
  2. After this, fill out the fields to create your journal entry. 
  3. Make sure your debits are equal to your credits once you’re done.
  4. Click Save or Save & Close.

Edit a Journal Entry

To edit a journal entry, adhere to the steps mentioned below:

  1. Move to the Company menu and then choose Make General Journal Entries.
  2. Locate and select the journal entry you need to edit:
  • In QuickBooks for Windows: Click on Find and enter the Name, Date, Entry No., or Amount then hit the Find icon.
  • In QuickBooks for Mac: Find and choose the journal entry from the list on the left side of the Make General Journal Entries window.
  1. Click twice on the journal entry, and then make your updates. 
  2. Once done, press Save or Save & Close.
  3. Hit the Yes tab to record the changes.

Reverse a Journal Entry

  1. Hover over the Company menu and then choose Make General Journal Entries.
  2. Locate and select the journal entry you need to reverse:
  • In QuickBooks for Windows: Hit Find and enter the Name, Date, Entry No., or Amount, then click Find.
  • In QuickBooks for Mac: Find and select the journal entry you wish to reverse on the left side of the Make General Journal Entries window.
  1. Click on Reverse.
  2. Press the Save or Save & Close tabs.

The reversed journal entry has an “R” besides the entry number, and any debit and credit amounts reversed. The new entry is dated the first day of the next month, following the original transaction date.

Delete a Journal Entry

Follow the below-listed steps to delete or void a journal entry:

  1. Head to the Company menu and then select Make General Journal Entries.
  2. Locate and choose the journal entry you’d like to delete:
  • In QuickBooks for Windows: Choose to Find and enter the Name, Date, Entry No., or Amount, then click Find.
  • In QuickBooks for Mac: Find and select the journal entry you wish to reverse from the list on the left side of the Make General Journal Entries window.
  1. To delete the journal entry:
  • In QuickBooks for Windows: Click twice on the journal entry and then hit Delete or Void, then press OK.
  • In QuickBooks for Mac: Select Delete General Journal from the Edit menu. 
  1. Press the Save & Close buttons.

Record a Journal Entry in QuickBooks Online

To record the Journal entry in QuickBooks Online, go through the steps listed below:

  1. Click + New.
  2. Now, select Journal entry.
  3. On the first line, choose an account from the Account field. Depending on if you need to debit or credit the account, enter the amount in the accurate column.
  4. Select the other account you’re moving money to or from in the next line. Depending on if you entered a debit or credit in the first section, type the same amount in the opposite column.
  5. Verify the amounts – you should have the same amount in the Credit column on one line and the Debit column on the other. This means the accounts are in balance.
  6. Then, input details under the memo section so you know why you made the journal entry.
  7. Press the Save and New or Save and Close tabs.

Create Adjusting Journal Entries in QuickBooks Online Accountant

An adjusting journal entry is a type of journal entry that helps to adjust an account’s total balance. Accountants usually use adjusting journal entries to record uncategorized transactions or fix minor accounting errors. 

Why to create adjusting journal entries in QuickBooks Online Accountant?

You can create adjusting journal entries for a variety of reasons, which include:

  • Reallocating accruals and reversing accruals of prepaid income or expenses
  • Adjusting tax payable for interest, discounts, or penalties
  • Depreciation or amortization
  • Entering bank or credit card fees or interest

Note: You can mark journal entries by adjusting journal entries. This may allow you to easily identify and get reports for adjusting journal entries.

How to Create Adjusting Journal Entries in QuickBooks Online Accountants?

Below are the steps to create adjusting journal entries and review them on an Adjusted Trial Balance report in QuickBooks Online Accountant. 

Enter an Adjusting Journal Entry

You’ll make adjusting journal entries from your client’s QuickBooks Online company file.

  1. Log in to QuickBooks Online Accountant.
  2. Click on Go to QuickBooks dropdown and then opt for your client’s company.
  3. Select + New.
  4. Choose a Journal entry.
  5. After this, tickmark the Is Adjusting Journal Entry? checkbox.
  6. Follow the steps to record the journal entry.
  7. Then, press Save and close.

Review Adjusting Journal Entries

Run an Adjusted Trial Balance Report to review your adjusting journal entries. This report lists all your account balances in the general ledger before and after you create adjusting journal entries. It also lists the total adjusting entries.

Here’s how:

  1. On QuickBooks Online Accountant, enter Adjusted Trial Balance into the search bar. 
  2. Or navigate to the Reports menu and then choose the Adjusted Trial Balance report.
  3. Select Customize to adjust the report as required.
  4. Ensure that the total debit balances are equal to the total credit balances.

Create a Recurring Journal Entry in QuickBooks Online

A recurring journal entry is a template of a journal entry that allows you to make journal entries for transactions recur on a fixed schedule. This type of transaction is useful for businesses who have subscriptions and memberships, utilities, mortgage payments, car loans or any other type of recurring payment.

In QuickBooks Online, you can create templates for recurring transactions like recurring expenses. You can do this for any transaction except bill payments and time activities. Below, we’ll show you how to set up and make the most of recurring templates.

  1. Navigate to Settings.
  2. Now, choose Recurring Transactions under the Lists column.
  3. Click New. 
  4. Select the type of transaction to create, and hit the OK tab. 
  5. Enter a Template Name. 
  6. Choose a Type – Scheduled, Unscheduled, or Reminder. 
  7. Fill out the necessary details and complete the fields. 
  8. Press Save Template. 

How to view past Journal Entries in QuickBooks?

To view your old entries in QuickBooks, follow these steps:

  1. Head to the Reports menu and then locate Journal.
  2. Press the Customize button on the Report window to filter specific Journal Entries.
  3. After this, choose the Date under the Report period.
  4. Tickmark the Transaction Type from the Filter dropdown and then select Journal Entry from the option.
  5. Then, click on Run Report.

You can also view Journal entries by doing the following:

  1. Hit the Create icon (+) at the top right corner.
  2. Select Journal Entry.
  3. Click on the icon with a counterclockwise arrow in the top left corner.
  4. Once done, choose to View More.
  5. Now, you can view all the past Journal entries. 

An example of a Journal Entry

How to Record a Journal Entry in QuickBooks?

This journal entry shows that there was $500 worth of employee wages. From that, $500 and $100 were set aside for taxes in the Payroll Liabilities account. The remaining amount comes out of the checking account and goes to the employee for direct deposit. At the bottom of the journal entry, you can see both the debits and credits equal 500.00.

Bottom Line!

Journal is the primary book of accounts as it helps to maintain accurate financial records in QuickBooks. The purpose of a journal entry is to physically or digitally record every business transaction properly and accurately. It not only reduces the chances of excluding a transaction but also makes it easier to correct data if mistakes are made. 

Since all journal entries are written with explanations, it becomes easier to understand financial activities later. With journal entries, you can set up your opening balance for the chart of accounts and have the flexibility to move values in your books manually. Also, business owners can ensure accurate financial reporting and make necessary adjustments to their accounts according to their business standards by creating journal entries in QuickBooks.

By : July 8, 2024
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