 QuickBooks Online 2023. Bank feeds for credit cards set up process. Get ready to start moving on up with QuickBooks Online 2023. Here we are in our bank feeds practice file. We started up in a prior presentation using the 30-day free trial. We also have open the free QuickBooks Online sample company support accounting instruction by clicking the link below giving you a free month membership to all of the content on our website broken out by category further broken out by course. Each course then organized in a logical reasonable fashion making it much more easy to find what you need than can be done on a YouTube page. We also include added resources such as Excel practice problems PDF files and more like QuickBooks backup files when applicable so once again click the link below for a free month membership to our website and all the content on it. If you want the to open at the same time we suggest using incognito to open the sample company or another browser you can open incognito if using google chrome by selecting the three dots in the browser incognito window typing into the search engine QuickBooks Online test drive we're using the sample company to compare the accounting view the one the bank feeds practice file is in and the business view the one the sample company is in to toggle between the two you can go to the cog drop down and switch the view on down below we're going to open some tabs to put reports in like we do every time right click on the tab up top to do so duplicating it and then we're going to duplicate the duplication process with a right click and duplicate again back to the tab to the middle reports on the left opening up the balance sheet report which is in the favorites and should be in your favorites as well if you're in the sample company by the way the reports they're located in the business overview on the left hand side and then the reports just so you know just so you know where they're at on that view back to the tab on the right this time reports on the left hand side let's open up the profit and loss otherwise known as the income statement the other favorite report change the range i'm going from 010122 tab 123122 tab run it to refresh it tabbing to the middle closing the hamburger going up to the top change in the range 010122 tab 123122 tab run it to refresh it you did that way too fast well that's because that's because we do it every time okay you should you should have seen like a hundred of these by now if you're not there's it you should go back to the prior ones so you could see all of them so let's go to the first tab now and open the bank feeds because that's where we've been focused on first tab we're going to go to the bankings on the left hand side bank feeds and then if you're in the business view by the way they're in the bookkeeping as we all know at this point in time transactions up top and then the bank transactions that's where they're located in the business view now in a prior presentation we set up the bank feeds for the checking account which is typically the first thing we think about with bank feeds but it's not the only thing we should think about because we also have the credit card bank feeds that we could set up as well they function in much the same way the credit cards being facilitated from a financial institution and so they have similar workings to them so just a quick recap on how that might work and then we'll kind of link up our credit card just to give us a look at it so most of the stuff we learned with the checking account will be much the same with the credit card account in that we're going to connect we have to have a general ledger account that will set up we have to then connect the bank feeds to that general ledger account and then the bank feeds will come into what I would call bank feed limbo just like what we saw before so we'll have to add that final information to pull them in from bank feed limbo into the promised land you can call it credit card limbo if you want but it's kind of like the same limbo area really we're all it's all the same kind of limbo stuff and we got to give it the added information such as account that it needs to be assigned to customers or most likely vendors with the side of the credit cards so it can be pulled in to the financial statement creation the only difference being of course that will have a liability down here for the credit cards the credit cards are going to be a liability so every time we pay for something with a credit card you can imagine a situation where instead of paying stuff with electronic transfers out of the checking accounts we pay for things with the credit card we've got our credit card tied out to everything that we're paying for electronically and then of course hopefully we pay off the entire credit card balance at the end of each month so that we don't hit the financing charges and that can actually be you know a good kind of system to do that and that means that whenever we make a purchase there's going to be an increase to the liability as opposed to a decrease to the cash account so we'll just increase the liability the other side will go to like expenses like the utility bill the phone bill and so on with every purchase in the same manner as we saw with the checking account and then periodically hopefully monthly we're going to have an interbank fee transfer decreasing the checking account right because we're going to pay off the credit card and then paying down the credit card account so the credit card account is actually a little bit easier in some ways than the checking account because with the checking account we usually have to deal with both the decreases and the increases so a significant part of the checking account that can add to complications is the revenue side of things whereas with the credit card it's only used to pay things off and then and then the other side the other direction of the transaction is to pay off the credit card so you don't have that kind of deposit situation which can be complicated depending on the type of your end industry you're in as you do with the normal checking account because you're dealing with just electronic transfers for a credit card as well most of the time you can do i'm going back to the flow chart like we saw with like the vendor side of things on the checking account you could just pay for things electronically and therefore depend on the bank in order to record the transaction so you're actually constructing you know your credit card information pretty much totally from the bank oftentimes instead of doing the full service kind of accounting system where you're going to first enter the charge in on our end that would be like when we pay the utility bill we we enter the transaction on our end and then verify it to the credit card because it's such a short timeframe between when the transaction happens and when it clears the credit card the financial institution we're often able to just basically depend on building our financial statements from the credit cards and that makes the reconciliation process very easy because we constructed the whole thing basically directly from the financial institution instead of using it kind of as a verification type of thing similar process we saw with the bank feeds but with we saw in the bank feeds on the checking account side we saw sometimes where we have to deviate from a system where we just create our books from what's coming through on the bank with the credit cards we'll usually just construct our books from what's coming through on the bank and that usually works quite well all right so let's go ahead and and see the adding of the credit card so if i go to the general ledger on the left hand side we're going to go to the accounting and then not the general ledger the chart of accounts the chart of accounts if you're in the business view by the way the chart of accounts are in the bookkeeping and then the chart of accounts now within the chart of accounts we're going to need a liability type of account but it needs to be a specific liability so i'm ordered by type here so we don't have any credit card account accounts in here as of yet if you only have one credit card you might just make one credit card account if you have multiple credit cards then maybe you make a parent account called credit card and then have the subsidiary accounts possibly naming the actual credit card financial institution possibly adding the last four digits of the number to verify and distinguish multiple credit cards you might be using in the business let's do that i'm going to add a new account up top and it's not a liability account it's a kind of liability but it has to be a specific credit card of account because that's the account that has the capacity to connect to the bank feeds we're going to say it's going to be a credit card and the tax section i'll say credit card i'm just going to give this one the generic name of credit card as the parent account credit card parent account so there it is i'm going to save it and then i'm going to make another account which is going to be a subsidiary account to that credit card so i'm going to say let's make another one and i'm going to say this is going to be also a credit card account and i'm going to hit the drop down and say it's going to be a subsidiary actually of the credit cards of the credit cards actually maybe i don't need to do that because that would be redundant because it's going to still be able to be collapsed under the credit card account so let's just go into this credit card account and i'm going to edit it i'm going to edit it and say it was credit card for let's say visa and then you might put like the last four digits of the number the point is that you don't really want the last four digits of the number to be for external reporting you want those last four digits possibly to help you to distinguish for internal reporting and if you're able to like collapse and expand the account categorization then that makes it easier to distinguish between the two to run a report for external reporting while still having the number for internal reporting so if i don't have a sub account then it's a little bit harder to collapse it in some ways but it'll still be able to collapse by by section because quickbooks will create another section called credit card so hopefully it will take a look at that if i remember after we add some of the data so now that the account is set up i'm going to go back up into the banking area which is where our bank feeds are at now note that if your bank feeds weren't set up already then you can set up a new account and the bank fees the screen would look different but most people probably if they're setting up their credit card had already set up their checking account and are now adding another item being the credit card also note that when you're adding an account for a link to the bank feeds you can add the general ledger account typically as you go so we added the general ledger account basically first so then we can go to link account so i'm going to go to the link account up top and so this would be the same kind of process we would generally have for the bank accounts if you were linking directly to the bank you can search for you know visa or whatever that you're linking to and it's usually a pretty clean process but remember you have the same caveats for the credit card as you do with the banks making sure that you're pulling in the proper time frame so that you're not duplicating the information uh in your system so you're going far enough back that you're pulling up the information that you want you're not duplicating the information and you're not missing uh any information sometimes some financial institutions have some limits to how far back you can go with a direct bank feed so in that case you might want to in some cases if you want to go back like a year or multiple years and reconstruct your books or something like that then uh you might want to first download the information from the financial institution which sometimes allows you to go a little bit further back or if you're using a practice problem you might feel more comfortable downloading the information from the financial institution to practice with either way you will end up in the same situation which will basically be that you'll be in bank feed limbo with another card up top and your data on down below so we're going to do that the second option here we've downloaded the information from the financial institution so if you go to your financial institution you go to your credit card uh place there's usually some area where you can download the transactions and the formats of downloading the transactions are often quick in quickbooks or a comma-sliced uh item so the ideal one would be to use quickbooks but if they don't have a quickbooks item then you might be able to use the one that's a comma delineated which means deliminated deliminated it's a comma-sliced one but usually you can open it in excel so the comma-sliced one will look something like this and uh you can use that one but if they have one that looks like this which is a quickbooks one it kind of looks like the desktop software icon but it's actually not this is actually the bank feed data if i right click on it and look at the properties you can see it's a quickbooks o f x data it's a dot q b o file that's the one we're going to use also just note that if you wanted to practice with data that wasn't from a financial institution you can just create the information in say excel so if i was to open up excel and i wanted to just upload some information to practice with the bank feeds to get a feel for it i would just need a bank a date field i would need an amount field and then i would need a description a memo field and then when you save the excel file you go to file save as and you want to make sure that you change it from excel to some kind of csv comma deliminated file which is acceptable and then you can practice with whatever data that you want to upload uh there but you lose some of the authenticity of the bank feed memo stuff that looks all funny uh with the bank feeds it's a lot more difficult to like create or edit a and actually uh quickbooks kind of data file that you download all right so let's go back in and upload that so so i'm going to go to the drop down and upload from a file and so i'm going to use this option dragging it from a file notice you've got all the options csv dot q f x and here's the q b o that's the main one that should be as clean as possible to upload quickbooks should not have a problem you would think with that one the most it should be the easiest for quickbooks is what i'm trying to say why don't you say it right then i don't know i can't talk so we're going to go to the credit card and then continue so now we're going to put this into uh it gives you the account information on the left we're going to put it into that credit card now if i didn't add a credit card account i could add it basically as we go here but i added one so here's my credit card one right there that's the one right yeah that's it so let's add that and continue and so import completed accept your transactions done and boom now we've got two tabs up top the second one is uh the credit card information so i'm going to close this out and just try to look at my credit card information what is it doing funny stuff credit card information close this out okay there we have it so now we've got our credit our credit card stuff down below once again it's in bank feed limbo so generally that shouldn't have recorded a transaction on the financial so if i go to the balance sheet and i run it it generally shouldn't record a transaction here although sometimes you have that beginning balance problem you see it put it put a balance in here because it's trying to record that beginning balance so that the cutoff date is always kind of an issue where you always want to think did you get enough information uh into the system is it going far enough back that you needed to go back and then what's do you have to enter the beginning balances if this is the first time you connected the credit cards or are you just now turning on the bank feeds but you all when you were already tracking the credit card information in the past if it's the first time setting up the credit cards you're probably going to have that beginning balance issue from before you turned on the credit cards right and so we're gonna have to deal with that they made a transaction here to kind of pick that up from the banking information if i think that's appropriate then i can keep that here if i don't like it i can go into this transaction and put the other side to opening balance equity and just delete this and then i can figure it out when i do the bank uh reconciliation so i'll do the bank reconciliation is just like i did do with the it's the same problem as with the checking account you'll have that same issue that we talked about so then so then we'll have to deal with that and i'll deal with it more when we get to the to like to the reconciliation process a lot of people don't reconcile the checking the the credit cards as much formally because the credit cards should basically tie out exactly to to what's on your statement because you're creating all the data directly from the credit card feed but the the reconciliation is the same thing so you might as well kind of do it just to make sure that you're not doubling up on transactions or that you missed a transaction and when you first do the credit cards when you first set them up you're gonna have that same beginning balance issue which you're gonna have to kind of reconcile before your credit card is is rolling forward once you get the balance to be correct then it should be good going forward so we'll talk more about that uh in a future presentation but we're set up uh good to go now the other side of that transaction you'll note they dumped into the opening balance equity so whenever you have something in opening balance equity that's an indication to you that quickbooks did something funny right quickbooks threw something on the other side for a beginning balance or in this case we we said the inventory had a balance in it and they put something in here so that should always be an indication that you want to kind of double check and then probably clear out what's in opening balance equity because it does not look uh professional nothing happened to the income statement so so no change on that in future presentations we'll go in here we'll take a look at the credit card we'll see that it's basically quite similar to entering transactions the general transactions once set up as with the checking account and then we'll have inter uh bank fee transactions we'll have to deal with with regards to uh paying off from the checking account the credit card balance and then and then we'll get into later possibly uh bank reconciliations and rec credit card reconciliations to deal with that beginning balance issue in both of those areas one thing i wanted to note as well before i forget is when i was trying to set up the credit card notice that over here the credit card has this drop down right because and the reason it has this drop down is because the credit card is not just an other current uh liability which it is but it's got its own special needs like the bank account does up top and therefore it has its own account class and that's why it has this drop down so if you put your credit cards all under the credit card account then you get this nice drop down so you could report it externally as just credit card liability and internally you can have multiple credit cards with that last four digits of the number and so on so that you can know which credit card you're talking about now the problem is sometimes is that this this one collapses easily this way but if you were to record like if it was a sub account then you can collapse you could you can collapse the the lines and the sub accounts collapse so that one doesn't collapse even though uh you have a collapsed statement only the sub accounts would collapse that way so that's why if you made another like credit card a parent account and then the sub accounts and you wanted to record a normal income statement there's also you can also record or create a summary balance sheet which will collapse all of the categories like uh current current assets and so on but if you just wanted to collapse like the sub accounts that you made then for external reporting you won't be able to collapse that item that's what I was kind of talking about when we set up the credit cards so it might not be a problem it's just internal reporting versus external reporting stuff so that's that