 QuickBooks Online 2023. Credit card reconciliation month number two. Get ready to start moving on up with QuickBooks Online 2023. 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. 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. If you want the two open at the same time, we suggest using the incognito window or another browser to open the sample company. 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. You could toggle between the two views by going to the cog up top and switching that view on down below duplicating some tabs like we do every time to put our financial statement reports in, right clicking on the tab up top to duplicate it. And then we're going to right click on the tab up top to duplicate it back to the middle tab. We're going to the reports on the left, opening up one of the financial statement reports the balance sheet and note that if you're in the business view by the way, the reports are in the business overview reports on the left hand side back on over. We're going to say tab into the right reports on the left this time opening the profit and loss, the P and the L closing the hand boogie and changing the range in 010122 tab, 123122 tab running to refreshing tabbing to the middle in closing the hand boogering and then changing the ranging again in 010122 tab, 123122 tab and running it running. All right, let's go to the tab to the left now and open up the bank feeds because that's what we're working on all the time. That's in the banking tab on the left hand side. If you're in the business view by the way, the bank feeds are located in the bookkeeping and then in the transactions and then in the transaction bank transactions. That's where there are there a little bit more buried down a little bit deeper down, but that's where you find them. All right, last time we did the first bank reconciliation for the credit cards, which is similar to bank reconciliation. You might be familiar with with the checking accounts, the credit cards being a similar kind of scenario because we're entering the transactions from the bank feeds oftentimes with the credit cards and we can still verify if there's any kind of differences or timing differences between the transactions. There usually are no timing differences between the transactions because most people record their credit cards on the business side from the credit card statement using the bank feeds and therefore we're not going to have any timing differences. So why do the credit card statement in any case? Why do it? It's a double check to make sure that you haven't double entered anything or that you haven't not entered anything like the bank feeds got messed up and something didn't get pulled in properly. So that's one reason you can kind of double check that by looking at the balance at any given time, which should in essence match the balance on the credit card, online credit card statement as you're as you're looking on it. But if there is a difference with it, if it becomes out of whack somehow, how do you fix that? You reconcile, you reconcile. So it's just a good practice to be doing. It's really easy to do now that we did the first reconciliation where we had that beginning balance issue to tie out that beginning balance. The all the reconciliations going forward should just be a matter of let's just verify the balance looks good. Let's go into the reconciliation and just check everything off just and that should be it. So let's see how easy that will be. So the first bank reconciliation for the credit card reconciliation was on 831. And now of course we fixed that beginning balance issue. And now this is our ending balance as of 831. And then the current balance we're going to look at starts with that beginning balance, which should be correct now because we fixed it. And then here's our charges and our payments. And then here's our balance at the end of September. So let's go over here and let's run our balance sheet on a month by month basis. And let's actually change the range from let's go from 08, 0122 to 1131 22. And then 1130 22. There's only 30 days. I knew that my birthdays in that month. I know all about November. Any case, let's go to the month by month breakout. And then if I scroll down to the credit cards and look at what's on our side of things, this 522 71 now ties out to the Indian balance for the end of August because we fixed it. And then in September, 717 22, 717 22 also ties out because the beginning balance is now right. And we entered all of our information from the bank or credit card financial institution. Therefore, this one should tie out perfectly as well. So why even go through the bank reconciliation? Because again, we kind of want to double check that everything is tying out properly, not just the ending balance, but all the detail. And so that if there is a problem, if things do get out of whack, we know how to fix it. So we're going to go to the tab to the left and the reconciliation will be very easy now. Moe's fossil, Moe fossil Trent thing to do. So let's go. Let's what he just stick to you can speak English for crying. Okay, let's go to the accounting down below. No need to disparage my Spanish skills reconciliation on the right hand side. And then we're going to go to reconcile. I'm going to close up the handbook. You notice that if you're in the sample company, that's located the reconciliation that is in the bookkeeping and then experts and reconcile. Okay, so then we're doing the credit card. So we're usually people think of the bank accounts up top, but you can also reconcile and should be reconciling. Although it's typically quite easy to do the credit cards. And now the beginning balance ties out to what's on our statement. So that's good. That looks good. The ending balance, we're just going to put in place according to the statement 71722 717.22 ending balance as of September of 2022 is boom. And there we go. So we can just start the reconcile. And then once again, the statement balance, that's what we basically just typed in there. There's the cleared balance, which is calculated as the beginning balance in our system, which rolled over from the prior bank reconciliation, plus the charges, which are all checked off down below minus the payments, which are all checked off down below. The difference is zero. Notice we didn't have to do anything to get that difference to zero because everything is just checked off already. If I uncheck this all down below, then I would only have the beginning balance and I would have to tick and tie everything off. So remember in a full service system, if you were doing like a like the checking account and you actually wrote checks, then you'd have to verify the beginning balance and say, well, that checks off. And then I'd have to go through all the customer payments and say, okay, the customer payments over here, if I look at the payment side is the is the 275 or whatever. And that checks off boom, boom. And then I'd have to check all these off. And I would always go from the statement over to the, the, our books going to the charges and check them off, you know, one by one, bam, bam, bam difference going down to zero. If the difference is anything other than zero, even if it was like a dollar off, then I want to find where the problem is because a dollar difference might be not just one transaction, but multiple transactions that net out to that dollar difference. So this difference really has to be zero. And it should be pretty easy to do, because you should be able to tie exactly what's on the statement to what is on the books. If it's on the statement and it's not on our books, then we're gonna have to fix our books unless the statement is wrong, right? We'll have to fix whatever, fix whatever transaction is incorrectly input or put a transaction in place that was not input. And if it's on our books, but not on the bank statement, then in a full service accounting system, then you would think that that might be an outstanding item. If it was a checking account, like an outstanding check, like one we wrote that didn't clear the bank, for example. So nobody's wrong here. It's just that we had the information before the bank, therefore timing difference, that would be the reconciling item. But here we don't have any timing differences because we didn't do a full service accounting system. We made our books based on the bank's information. So it should be really easy. See, that's why it's really easy. I should be able to just go in here and just check the whole thing off. I don't even have to check the whole thing off, because it's already checked off. And then the thing should be zero and you're done. So then I'm going to finish it. Just make sure that that's zero. If it's not zero, you've got work to do. Things need to be done. Stuff has to happen. So don't forget that. But it should be zero most of the time. And then you can just finish it up. Say, boom, it's going to say, do you want to pay the outstanding balance? I don't like paying through the system this way. I just pay the credit card when I feel like paying the credit card. So I don't usually use this option, but you could pay this way. But I'm going to say done and boom. And then I can see my reports by going to the history. And now I've got our two reports. This was for the last month and then the current month in September. If I go into it, it's a really boring report. This basically just recaps the bank statement. So the 522.71, the 469.98 and the 275. That's what we clicked off that clears. So it should be the same numbers here. And then we have what's on our books, the 717.22. And so that's what's on our books over here. That's the book balance. What's the reconciliation between the book balance and the cleared statement balance? Nothing. Why? Because we built our books from the bank. So there is no difference. There's no timing difference, right? Where there would be if, for example, we built our books and then double checked it to the bank, because then even though the credit cards clear quite quickly, it's possible that we entered something on our side when the transaction happened and it had not yet processed through the bank. The most common example in a checking account would be a check, a physical check, takes a long time to clear. So you're going to have timing differences. But we're dependent on the bank oftentimes with the credit card because we're becoming more and more comfortable that the credit cards will clear, that the bank system is working and the timing transactions are short. So the reconciliation should be easy. So that's going to be that reconciliation. So I also just wanted to note that those reports are a little bit different than other reports. So you can find them by going to the accounting tab like we are in reconcile and then go to account history. I think you can also get to the same area in the reports if you wanted to go to like the reports, because you might think, well, a bank statement is a report. And then I'll just type in here, reconciliation, reconciliation, and there's your reconciliation reports. If I go into that, it takes me out of the reports area and back into where I was. And there's our reconciliation reports that we can find the reason that these are different than all of the other reports is because all of the other reports are being constructed as we enter the data input. So all the other reports basically as we do these transactions, they're making financial transactions that have at least two accounts affected according to the double entry accounting system, creating the balance sheet income statement, the major financial statement reports and all the other subsidiary reports are generally being constructed at the same time, providing more information about one or multiple line items on the balance sheet or income statement as we construct them with these transactions. Whereas the bank reconciliation report is us verifying our books to an outside source that's also doing basically our books, right, in terms of just the credit card or the checking account. So it's a verification, an internal control type of report instead of a report that we're constructing as we do the data input. It's kind of like checking our numbers as opposed to entering the data. It's kind of like instead of doing the math equation, you're verifying the thing, right, with this report. So it's a little bit different in that way. But that is that. And then we'll move back on in future presentations to the banking for the credit, for the checking account and we'll do a similar kind of process, finishing this up and then looking at our bank reconciliation is dealing with that beginning balance issue with regards to the checking account.