 QuickBooks Online 2024 credit card bank feeds adding data. Get ready and some coffee because QuickBooks Online is even quicker to the trigger than QuickDraw McGraw. First a word from our sponsor. Yeah, actually we're sponsoring ourselves on this one because apparently the merchandisers they don't want to be seen with us but but that's okay whatever because our merchandise is is better than their stupid stuff anyways. Like our crunching numbers is my cardio product line. Now I'm not saying that subscribing to this channel crunching numbers with us will make you thin fit and healthy or anything. However it does seem like it worked for her just saying so yeah subscribe hit the bell thing and buy some merchandise so you can make the world a better place by sharing your accounting instruction exercise routine. If you would like a commercial free experience consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. Here we are in our QuickBooks Online bank feed practice file we set up in a prior presentation opening the major financial statement reports like we do every time the reports on the left hand side within the favorites we're going to be right clicking on that balance sheet to open a link in a new tab right click the profit and loss otherwise no one has the income statement to open a link in a new tab doing the same for the trustee tb if you don't have that trial balance in the favorites you could search for it let's tab to the right close up the hamburger and change the range we're going from 010124 tab 033124 tab drop down we want to see it month by month and run it and then we'll tab to the right close the hamburger and change the range again 010124 tab 033124 tab drop down for the months run it ultra base another time tap into the right close in the hamburger again one more time 010124 tab 033124 tab months and run let's go back to the balance sheet we've been setting up and thinking about bank feeds first looking at the credit card or the checking account which is the first thing that usually comes to mind with bank feeds but we now have set up the bank feeds for the credit card which actually is usually an easier thing to do which would be down here in the liability section so let's go to the first tab and go to the transactions and if we look at the bank transactions closing the hamburger we now have the two cards up top because we have two different financial items or accounts connected to the bank feed so we've got the credit card and the checking account we want to make sure that we're on the credit card tab and when we scroll down note that with the credit card most of the transactions are going to be similar to with a checking account kind of transaction where you're paying for like expenses with an electronic transfer as we saw with an example of a telephone expense and the utilities expenses with the credit card they're all going to be like that in that they're typically going to be the easier types of transactions where we can wait till they clear the bank and record them to an account as they clear the bank because we'll have that added detail of the checking account detail and because the date will be relevant given the fact that they are electronic transfers now selecting the drop-down we saw this on the bank feed side of things I like to be able to make sure I can see the bank detail so that if so that if there was information in the detail I could use to create our rules then I could use those items all right so let's just add a few of these I'm just going to add them in and create rules as we do it just like we would do with the bank feed so let's imagine the staples here are going to be items that we used for supplies now staples happens to be an office supply store so you might end up in a situation where for example if you have small purchases you might be purchasing those for supplies if you have large purchases you might have purchased property and equipment so you have to be careful of that possibly putting a rule in place that if it goes over a certain dollar amount we then treat it differently we'll talk more about that later but for our purposes we're just going to say that these are all going to supplies purchases so I'm going to copy this I'm going to put that in the vendor remembering that the minimum that we need as with the checking account to pull things in from bank feed limbo to the promised land of the creation of the financial statements is a category otherwise known as an account however you typically want to be putting in a vendor as well because that gives you another place that you can sort by just like with the bank feeds and that usually will be something that can be found in the memo although the memo which is comes from the bank transaction detail although the memo might have a bunch of added jargon in there so you want to make sure that you go into the memo and you pull that information in and add the vendor because that'll give you some more detail okay so once we have the vendor that's the thing that will usually identify to us what the account it should be going to remembering that we don't set up expense accounts by vendor typically I'm not going to create a staples expense account I'm going to say what did I buy at staples I bought supplies and then I'm going to make the expense account based on what was purchased so in this case supplies so I'll say do I have a supplies one I don't think so so let's add a supplies expense so I'm just going to add them as we go this is going to be an expense type of thing which is typical of the credit card category and let's say that this is going to be supplies supplies and materials and so that's good I'll keep it at supplies and materials and let's add it so then we could add a class if we needed to if you have class tracking on we have the tags we won't get into the tags now you can add an attachment just like with the normal bank feeds and we can create a rule let's create the rule so we can create the rule often with the name that we added as the vendor that we picked up from the memo typically it's a money out rule I'm selecting that it's only going to be applicable to the credit card I could select all of them making it applicable also to the checking account whichever one we want we all choose that one and then we're going to say it's going to be all rules that are going to apply noting that because staples is a purchase of supplies you might add another rule down here and say I want to say that the amount should be less than so less than let's say a thousand dollars you might make a rule such as that and call this supplies less than one thousand as the rule because that means that if it's over a thousand quickbooks will not apply the rule and then and then you can see if you should be putting it on the books as an asset we'll talk more about those more complex rules later though I'm pulling it from I like to take it from the bank text which contains staples I don't need any jargon after that I could test the rule and four of them are applicable that looks good the thing that it's going to do is have an expense type transaction that's the form typically used when we decrease the checking account like a check form but instead of it being applied to the checking account decreasing an asset it will be applied to the credit card account increasing a liability so it's going to be supplies and materials uh who paid I'm just going to leave that who you paid I'll leave that as is or I could put staples let's put staples there no tags no class and I'm not going to have it added automatically but rather I'm going to check them and then add them and then possibly after I've checked them I will turn this confirmation on in the rule settings let's save it and so so then we might check one of them all of these have a rule now applied to them if I select the drop down I could say that I want to see the ones that have a rule applied and then I could select if I feel good about them which I well let's do one first let's open one up and then confirm it so confirm and then it moves it from here to the categorized field so now it has been categorized and notice over here you could undo it from the categorized field or make adjustments to it within here if you if you need to after it's been uploaded but I'm going to go back to the review go back to the balance sheet run it and then within the credit card here's the credit card we did that I think that was it was that a January one I can't yeah so there it is and notice it's an expense form the same form that usually decreases the checking account it's $37 if I go into it it opens the expense form but instead of going to the checking account it's now going to the credit card account so similar transaction the other side's being going to an expense account because we assigned it there and instead of decreasing the bank account on assets it's increasing the credit card account a liability all right the other side's going to the p&l the profit and loss the income statement and so we put it into supplies so there it is the 37 and if we go into that we see the other side of the transaction so let's go back and then we can go back to our transactions over here and now I'm going to sort am I on the credit card yeah I'm going to sort by recognized so I'm going to say we better or rule applied and then select all of them and say all of these are good to go so I can confirm edit or exclude them I'm going to go ahead and confirm all of them pulling them in so now if I go to the balance sheet and I was to run it all of those transactions should now be in the credit card boom so if I go into the last one here and then I change the date to January 1st I will see the detail so there they they have been included that looks good let's go back exit profit and loss run and we could see in the supplies down here we see the information pulling into the supplies account so that looks good let's go back to the to the bank feeds and then I'm going to remove the rule and then down here we have these two for the outback steakhouse now I just want to point out that if you're a bookkeeper the question will be what is that a business expense or not because it looks like a restaurant might be personal so that's going to be confusing for a bookkeeper because they're not going to know if you took clients to outback or not or whatever right so so if it's so the question here is going to be like we saw with the with the checking account if you have personal transactions that you paid for what you typically want to do is pay yourself from and and call it a draw and then use that money to pay for personal expenses if you're paying cash if it's a credit card what you would like to have are different credit cards a business credit card and a personal credit card however many people aren't that good at differentiating the credit cards between business and personal and then you could try to sort out your business and personal transactions as they're paid through the credit card which is difficult for a bookkeeper to do it's more manageable if you do it yourself right and then there's two methods that you can basically use that we talked about in a similar fashion on the checking account one if I recognize that this was a personal expense I can record it directly to a draw as though basically we paid ourselves in other in other words right we took the money out from the business or we took a liability on the business for the credit card and then we bought personal stuff for it or we could try to run a profit and loss by class turning on class tracking and then and then see if we can break out columns between business and professional so that we can get an income statement necessary for small businesses for their tax preparation in the united states on a schedule seat let's take a look at both of those methods first I'm going to say this is personal let's say it was uh I'll record it as a draw so I'm going to say it was paid to outback steakhouse and boom I'll add them not sure if I spelled that right but that's and then here's the draw so it's going to an equity account for draws that's correct so I'm going to say okay and then I could create a rule for that if I think that every time I go to outback it's going to be going to draws but I won't do that now so we can see the two methods in a second so let's go ahead and confirm that one so if I go to the balance sheet so if I paid for something out of the business credit card that was personal then I'll still see it it's not the end of the world I'll still see it on the credit card side so I'm going to make this go to January and then there's outback it was with an expense form draws is the other side let's go back exit and then the other side is going into draws so if I go into draws and I change the date range to dude so there's outback steakhouse increasing here notice what it did not do it didn't go to the income statement if we did put it to the income statement it would have been an expense of some kind possibly like meals or in entertainment or something like that which is one remember that taxes for the for the for the united states are reversed in tax preparation expenses are good because they're deductions we want the net income to be as low as possible for taxes because we have an income tax the higher the net income the more income tax you're going to pay so if the IRS sees a big dollar amount to something like restaurant expense or meals in entertainment then that might draw flags to it right because then they're going to say that you might be expensing things that are personal or something like that so again you want to be mindful of those kind of things uh so that you so that you're properly allocating between between you know business and personal now the other way you could do that is you could say i'm going to use class tracking so class tracking you can turn on by going to the cog up top account and settings we turned it on already it's in the advanced tabs and then in here categories you've got class tracking and uh wait that's not it where did it go no wait that is it what am i talking about so we got class tracking and location tracking they're similar tags are also similar class tracking is generally the most versatile one that you can use uh and so so that's the one we'll just take a look at an example of so i'm gonna go ahead and say all right save that class tracking is on so if i go into this one let's imagine this is personal again but i would like to see the detail above both personal and business expenses on the income statement broken out by class so we can say okay i'm going to put this into a category of and i'll call it drop down expense account it's going to be an expense account and it's going to be like meals meals let's just say our entertainment entertainment meals let's say let's call it that but it's going to be personal let's put a p after it for personal and then i'll say uh save so there's the category and then i'm going to assign it to a class which i assigned p for personal and if you were to do this you probably want to assign every transaction to a class business and personal i'll show you why in a second we're not going to make a rule but if if this is the format that you were doing you could make a rule and assign the classes out let's confirm it then on the balance sheet note that class tracking is not normally something that you break out on the balance sheet which is why it's not you know ideal for a situation uh where you where you have a more complex reporting needs such as external reporting to a bank for example or for a more complex tax return where you have to report the balance sheet but it's going to have an impact on the credit card the other side on the profit and loss which is the form typically used for income taxes you can break out by column so instead of breaking out by column here on the months i'm going to break out by column classes so now if it were the end of the year i can break all of my categories into personal and not personal which would be business in this case but ideally if you turn the class tracking on what you would want to do is assign every transaction to personal or business and then anything that has not yet been assigned a class will go into not specified and you can drill down on everything that is not specified and assign it to a class which would either be personal or business right and that way you can kind of double check to make sure that you have properly assigned out every transaction because if you didn't it would be dumped into that not classified transaction that way you get an income statement for both personal and business with one quick books file if you can get the class tracking on it which which might be you have to depends on what tier of of quick books that you have as to whether you're going to have access to the class tracking right but you'd be great if you could do both on one company which again if you're a small business you might be able to get away with that if you have a bookkeeper they're not going to like that as much because again it's going to be difficult for them to see the vendors and assign them out they can do it but they'll have to communicate with you a lot at the beginning so that you can properly assign out what's business and what's personal and so on so that's the other method so then if I go back on over so we have those assigned out if I hit the hamburger and we go into the expenses tab we could see that that those items are can be tracked in here we've added the vendors so if I scroll down and take a look at the vendors we can go into staples and we see our transactions for our expenses in here and note that there's no accounts payable usually that you're dealing with with the credit card unless you're you know you're paying off your bills that came from the credit card I mean it came through accounts payable with a credit card which you could do but usually you're paying the credit card you know as they come do and not tracking the accounts payable with it so it's fairly straightforward that way let's open it back up go back to the transactions all we're left with at this time is the $100 here which is the payment deep where we're paying off the the liability we'll talk more about that next time and look at some different examples of how you can approach this notice it's pairing it out automatically but I just want to wrap our minds around what it you know what it means to have these two things connected because you could see it on both sides here right it's paired on the checking account and the credit card and then there's a question of what kind of form should I use notice it's using the record it's credit card payment what does that mean exactly what does it mean to be recorded as a transfer versus a category transaction so uh so it's a good opportunity for us to look at those and we'll we'll consider those inter-bank fee transactions in a future presentation but for now let's see where we're at for if we go to the balance sheet this is what we've constructed thus far do do do do so you can see it being built as we go from the ground up from the ground up we're going to the to the profit and loss and it's not going to fall over easy either because we put up good foundation in place we built it structurally sound using QuickBooks double entry accounting format and template so then we have the trial balance which I think is the best form to take a look at if you're following along it's the balance sheet on top of the income statement if your number is tied out to these numbers great if not try changing the date range it's often the date issue and then you can drill down to the source documents and actually change the date if you need to which is a great thing to be able to do in a practice problem but something you want to be careful of doing in practice