 QuickBooks Desktop 2023, credit card, bank feed, add data. Let's do it. Within two, it's QuickBooks Desktop 2023. Here we are in QuickBooks Desktop Bank Feed Practice File. We started up in a prior presentation, going through the setup process we do every time and the view drop down. We got the hide icon bar open windows. Support account 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. List checked off, the open windows are open. On the left, reports, drop down, company, financial, profit, laws, PL, changing the range 010123 to 123123, customize in the report so we can go to the fonts, the numbers and change them up to 14, okay? Yes, okay. Then reports, drop down, company, financial, this time, balance sheet, standard, the other fave of ours, that's our favorite from 010122 to 123122 and then the fonts, the numbers need to also change to match because they have to be matching. Yes, and okay. So then we're gonna go to the banking drop down, bank feed center, which would only have bank feed center if you set it up, which we did in the prior presentation. We've now uploaded two bank feed items, one for the checking account, one for the credit card account. We're gonna be moving on over to the credit card account, looking at the unrecognized items in them and adding the general data. So there's two main things that are gonna be a little bit different from the checking account on the credit card account that we want to think about. One, when we enter the transactions, they'll be much the same. However, instead of decreasing an asset account, the normal transactions when we buy stuff will be increasing a bad thing, a liability account. Two, we're gonna have to pay off the credit card, which usually is paid off from an item from the checking account. So then we're gonna have bank feed to bank feed transactions, we'll deal more with them in future presentations. But just a quick recap of the general rules, we pulled the stuff into what I call bank feed limbo here, which is where we would be, whether we connected directly to the bank or if we downloaded the info from the bank and then uploaded as we did this time, noting that it's not generally gonna be able to pull all the way through to the financial statements to either verify or create the financial statements. It's gonna be stuck here in what I call bank feed limbo because it doesn't have enough information such as the vendors, the customers and the accounts. We have similar information as you might have for a bank transfer in the checking account, like an electronic transfer in the credit card, that being that we're gonna have the date, which is relevant because that's gonna be close to the date the actual transaction took place given the speed of an electronic credit card transaction. We've got the information, the banking kind of information here and sometimes a memo type of information and of course the amount being an increase or a decrease. Oftentimes this detail will give us the payee that we're going to be paying, the vendor. However, QuickBooks cannot just populate automatically a vendor, so we wanna make sure that we set up the vendor so that we can track the stuff by vendor and not just by account. It gives us another added level of checking and verification detail to our financial statements. In the following month, due to us setting up rules as we enter the data, then the system will be able to see, hey look, this is the same person over here or company or whatever, so we're gonna then memorize what you did last time if we set up the rules properly and then we can automate things a lot more efficiently going forward. That's gonna be our goal, that's our objective. So if we record a transaction, it'll move over here to add it to the register. Remember that this one kind of washes out every time you upload or start again in the register. And then if it was recognized, it'll pull over here waiting for you to give the final A-OK to pull it into the system. Partially recognized would go into this category where currently all in unrecognized. I'm gonna sort by this item here and let's look at, we've got then, let's first take a look at these Costco. I think I got some Costco things down here. Let's imagine that this was for supplies. So, and let's imagine this is gonna be a business item for supplies and we'll talk a little bit also about a situation where you might use one credit card and you had some business stuff and some personal stuff on the one credit card. You would typically want to separate your credit cards using one for business, one for personal. That'll make bookkeeping easier and if you're having someone else do the bookkeeping it'll make it a lot easier. If you're doing your own bookkeeping, you might be able to distinguish what you bought for business versus personal, but if someone else is trying to do the bookkeeping or if you're doing the bookkeeping for someone else, you'd like to be able to say, hey, you gotta separate those because I can't tell if you went to Costco for personal or business, right? You gotta be able to distinguish that. So, okay, so I'm gonna say Costco. I'm gonna put that here, Costco and I'll do a quick set up. Did I spell it right? I think so, whatever. It's gonna be a vendor and then we're gonna say the account. I'm gonna put it to supplies. So I don't have supplies set up yet. If you were to have downloaded this accounts from the system, they probably would have a supplies expense account because we're making our accounts as we go. I'm just gonna add one supplies tab and I'm gonna set up the supplies account and it's gonna be an expense type of account. Now just realize there's a couple issues with Costco that are worth kind of just pointing out. We've talked about them briefly in the past. One would be that is it business or personal? We're gonna assume everything here is gonna be business. Two, if you buy something large from Costco, you might say, hey, this looks like it's gonna be a fixed asset and shouldn't be supplies and therefore you might try to set a dollar limitation in the rules to see if you buy something large from Costco to categorize it as a fixed asset as opposed to expensing it. And three, when we have supplies themselves, there's two methods we can deal with supplies. One, the easiest method, the cash-based method, we just expense it when we buy the supplies. That would be completely appropriate with like staples and stuff like that that we're gonna buy paper clips and whatnot. However, if the supplies go become significant like say you're buying medical supplies which become a quite costly endeavor, then you might have to treat the supplies kind of like inventory. They're not the same thing as inventory because inventory we typically think of as something that we purchase and then sell the inventory whereas supplies are gonna be the things that we use in the service of whatever service we're doing. So if we're a doctor and we have medicine, then the medicine isn't directly what we're selling. Oftentimes we don't think about it that way. We're selling our medical services and then the supplies are gonna be an expensive part of that service if we're using whatever cotton swabs and whatever, the alcohol that they rub on people and whatnot. That stuff can get kind of costly. So you wanna track it kind of like inventory. And in that case, you'd put it on the books as an asset like inventory supplies and then expense it as you use the supplies. But we're just gonna expense it here. Okay, let's save it. And then I'm gonna set up a rule for it. Drop down just like we did with the checking account and add a rule. And we'll say that the rule will be what's gonna be the rule. Here's the data up top. Everything looks good here. So I'm gonna say let's add a rule. I'm just gonna call it cost-co, cost-co. And I'm gonna say all or any, does it matter? However, if we set up a rule in which we're gonna say I want everything that's over a certain dollar amount like $1,000 or something to not go to supplies but possibly go to then possibly go to a fixed asset, then you might have two lines here, two conditions. And we'll talk more about that in the future. I just wanna be aware of it at this point. I'm gonna close that back out. And so everything looks good. So we'll set up the rule. Okay, rules have been made. There are rules here. This is an anarchy land. So then it pulled over the recognized items over here and to the recognized added one to the register. We got 10 left in the unrecognized. Let's go up to the balance sheet. And it's not the checking account that went down now. Now we've got a credit card account. And so if I go into the credit card account, it increased the liability. If I double click on this, it made a credit card charge. Now a credit card charge is similar to a checking, like a check type form. The check form decreases the checking account. A credit card charge increases the credit card liability account. Now note, credit cards are a little bit different than the checking, because usually we can at least possibly still remember when we wrote actual physical checks. Now most people might have electronic transfers. And in that case, we often entered the transaction in before it cleared the bank. With the credit cards, because they're electronic transfers, then we probably in a full service accounting system, we should enter the credit card transactions as we make them. But a lot of people will rely on the bank feeds, just like we talked about, if you're in like a gig work situation, where you're gonna wait till it clears the bank and then record it, because there's less of a time lag. So if you were doing a full service accounting system, again, you would want to record the credit card fees first and then wait till it clears the bank and then double check so that you're double checking that your accounting system matches what the bank is doing. Most people don't do that, at least for small businesses, oftentimes because they're all electronic transfers. So you're gonna wait till they clear the bank and then record them oftentimes, but the form will be the credit card form. All right, closing that back out, closing this back out. The other side went to the P&L, the profit and the loss. We're down here in the supplies. There it is in supplies. Now, if we were gonna put the supplies on the books as an asset, we would treat it kind of like inventory. We put it on the balance sheet as an asset up here, kind of like inventory. We'd count it using a periodic system or a perpetual system, whatever we set up. And then we would have to, you know, expense it as we consume the supplies, just to touch on that. Let's go back to the bank feeds and let's look at some other ones here. Let's say that we got some more of these. So let's say, let's pretend that this health insurance is actually, well, actually we've got, we've got, yeah, let's pretend that this health insurance is actually a personal health insurance and not a business kind of thing, but we took it out of our business credit card. So now the question is, well, what do I do about that? Same kind of thing that we saw on the checking side of thing, if you had a personal thing that you paid for out of the checking account, ideally, you'd like to use a different credit card so you don't kind of confuse yourself. But there's two ways we can deal with it. For a small business, you might say, hey, why don't I use class tracking in order to separate the two? Just to note that option, you could go to the edit preferences, you can go into the accounting company preferences and you've got class tracking right here. What that does is on the income statement, it will break out business versus personal. So you have two columns. So you can kind of have a personal income statement. It's, it only work really well. It'll work well if you have a small business that we just need a schedule C, although it does take more data input because you have to assign a class to every transaction. But that's one option you can experiment with. The other, the other idea would be that you're gonna have two accounts, right? One QuickBooks file for your personal, one for the business, possibly. And this came out of your business credit card account. So what you'd wanna do is not record it as an expense but rather record it directly into a draw. So that's what we'll do here. I'm gonna say, let's go pay ELISETS. Molina, Molina tab. I'm gonna quick add it again. Vendor and then it's gonna go to the account. I'm not gonna put it to like insurance expense because it's a personal expense and therefore I'm gonna put it into an account called an equity account, which will be draws. So ideally we would have taken the money out of the business, cash draw, cause that would be easy to see and recognize and then spend it out of our personal checking account so that we don't mess up the bookkeeping. But if we don't do that, then I'm just gonna record it directly to the draws instead of an expense. It won't hit the income statement in this way. So there it is. And we'll say, let's make a rule. Let's make a rule. There's rules around here. So we're gonna say rule time. Here we go. So this is gonna be Molina, Molina, Molina. It's a money out rule. And so there it is. It's gonna go Molina. It's gonna go to the owner draws. Looks good. Save it. Close it. Save to the reg. So there we have that. If I go to the balance sheet now, we're gonna say now we've got the accounts payable, the AP, not the accounts payable, I'm doing the credit card. There's the credit card. So now that one has been gone to draws. If I double click on it, it's a credit card purchase. Close on this back out, close on this back out. Other side did not go to the income statement, but rather went to draws a Contra equity account, equity representing what is owed to the owner, or in other words, the owner's share of assets, assets minus liabilities, what's owed to a third party is equity. And so if you take money out of equity, which we did here by paying something that's actually a personal expense, it's gonna decrease the equity. So that's what happened here. That's why it's a negative Contra equity account. All right, let's go back to then the bank feeds again and let's sort it this thusly. And we've got the board of accountancy. So that looks like a business type of thing. So I'm gonna say, let's make that a payee. We'll call it board of accountancy. And then I'm gonna say add that vendor. And that's usually something like a do's and do's and subscriptions or licensing or something like that. So oftentimes you might have that in a generic set of accounts, but we set ours up from scratch. So I'm gonna call it, I'm gonna call it do's and subscriptions because that's kind of a formal name. Did I spell that right? I don't even know. Whatever, whatever, it's practice. And then do I need to make a, I should make a rule for it. I'll make a rule, even though there's not any other ones. Don't get lazy. Here we go, make a rule. You need a rule. Rules are important. All right, board of accountancy rule, money out rule. That looks good. We'll save it and save to the register. So boom, that's gonna go back to the balance sheet, back to the balance sheet, back to the basics on the balance sheet. And so we got the credit card. So there is that one, double clicking it. There it is. And then closing, closing and the profit and loss. Now we've got the do's and the subscripts. Closing that back out. Let's go back to the bank feeds. Is there anything else that needs doing? We've got the auto pays. We'll talk about them. This one, let's imagine this was a charitable contribution, which might be a personal thing again, just to take a look at it. And so note, I'm gonna say this is to the FC premiere soccer and tab. I'm gonna set it up. Okay, but now I'm gonna put it to equity. So this is gonna be draws, draw the account. Why isn't it, why isn't it, cause they call it withdraws or something. They called it owner's draws. So notice this one looks like it could be something that could still have an impact on the taxes. If it's a charitable contributions, but it's not gonna come out of my business cause I'm imagining it's a sole proprietorship, but instead should be a personal item that I still want to track. That's why you might wanna have a separate QuickBooks account to track your personal expenses. So you can at least have the information you might need for the taxes in kind of like one place that could be helpful. And it's kind of nice to have a personal financial statements, even though you don't really need them for taxes. Or again, you could try to use the class tracking where you break out your income statement between the personal and business, but it takes a little bit more work and you gotta be careful when you do that. We have a whole course on that if you wanna look at that in more detail. So I'm gonna say tab and I'm not gonna set up a rule for that one, I'll just add. And then CVS pharmacy, let's say that's personal too. So I'm gonna say this is gonna be CVS pharmacy, tab, quick add, vendor. And I'm gonna say this is owner's draws. Why, why doesn't it give me the draws? You know what I want, QuickBooks. So we'll say add that. And then these three we'll keep for next time because these are the inter company transactions which are gonna be playing off of the checking account. So we're gonna have them in the checking account side coming out and then we're paying off the credit cards. We'll talk about that next time. If I go to the balance sheet, now the credit card is at the 816. We still have that same beginning balance problem with the credit cards that we do with the bank accounts in that we might have had an outstanding balance before we started the bank feeds. So we'll have to enter that beginning balance in place in order to get our liability correct. Once it's correct, it should be quite easy going forward given the fact that most people enter their credit cards or at least small companies enter their credit cards from they make their financial statements from the bank feeds as opposed to entering the data first and then reconciling. Therefore there's gonna be very few times where there's like a timing difference as opposed to the checking account where you could have outstanding checks and deposits. So we still have the reconciliation concept that we would like to do, but it's usually something that's quite easy given the fact that we're not really doing a full service accounting system. We're just kind of relying on the bank to enter the data. So we'll talk about that first reconciliation is gonna be a problem to get the balance correct the first time if you had a beginning balance can be a problem that can be kind of annoying just like with the checking account we'll talk about those issues a bit more in the future. All right, let's just open up the trial balance just to check it out because that's what I like to close off with here. So if I open the trustee TB from 010122 to 123122 customize it, fonts and numbers. I like to take it up a notch to 16. Okay, yes, okay, you can see that now we've got balancing on top of the income statement which are assets and then liabilities. Here's our credit card account and then the equity draws and then the income statement income and expenses including the cost of goods sold and then the other expenses and then other income and expenses down below. Quite nice, quite tidy, quite easy to go from data input directly to a trial balance without all the subtotals without having to scroll down as far without having as much stuff open in the open windows. So I recommend getting used to it and trying it out check it out.