 QuickBooks Online 2024 Bank Reconciliation Month Number 2 Deposits. Get ready and some coffee because the accounting team is on board with QuickBooks Online 2024. Here we are in our Get Great Guitars 2024 QuickBooks Online Sample Company file. We set up in a prior presentation opening the major financial statement reports like we do every time located in the reports on the left in the favorites. Right click in the balance sheet to open link in a new tab. Right click in the profit and loss open link in a new tab. Same for the trustee TB tabbing to the right hamburger close it range change it 010124 tab 022924. We're going to see it on a month by month side by side running to refreshing tabbing to the right closing the hamburger changing the ranging 010124 tab 022924 tab month by month breakout once again. 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. 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If you would like a commercial free experience consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. Running to refresh and one more time tapping to the right closing the hamburger changing the range 010124 Tab 022924 Tab. And then we will select the months and run it again. Let's go back to the balance sheet. This time we're looking at the bank reconciliation again but for the second month of operations. So in the prior section we looked at the bank reconciliation for that first month where we saw it can be a little bit more difficult because we might have that beginning balance issue. On the second month of the bank reconciliation this will be similar to the reconciliation process that we will typically see going forward from that point in time. So let's go back on over to this first tab. Let's go down to the transactions going to close up the hamburger. And in the reconcile tab you will recall that we can look at the prior reconciliations by opening say the history over here. We have the actual report and we can open up the attachment. So let's go ahead and open up the attachment for the prior time frame which I saved in here for the bank reconciliation for January. So this is the bank rec. Let's open that up. And this is what we had last time. So I'm going to close this out. And so that's where we left off from the prior period. Now we have a whole another month of data input. These transactions were those that were not cleared last time which we expect to clear this time. So in other words if I look at my bank statements this was my bank statement last time where I have the beginning balances the increases the decreases getting to that ending balance in January. We had this beginning balance issue for the first month but now that cleared balance to 61 to 41 85 will pull over and be the beginning balance in the bank statement in the second month. So I shouldn't have that issue anymore once we get online with our bank reconciliation. So we can see that here where we can see when we have the reconciliation we have our our statement balance being our cleared balance. At the 61 to 41 85. If I minimize this close this back out note that that amount of course is not what is on the the bank or our books our books are showing as of the end of February 95779.05. So there's still a difference that difference of course is going to be the outstanding checks and deposits. So we're going to do a similar type of process for the second month we'll be able to see some of those outstanding items for the prior period clearing in the current period. And then you would expect some items in the current period that we know about have not yet been known by the bank and those will be the outstanding or reconciling items for the second month. So we'll do this a little bit faster now because we've seen it before let's go to the first tab and we're going to go back into this reconciliation. We're into the checking account once again the beginning balance notice it's hard coded now because because it's pulling in from the prior period. Now if you if you needed to adjust the prior period if this number was wrong and you did a bank reconciliation before then you might actually have to go to the prior reconciliation. And undo it right redo the prior bank reconciliation so that you get your beginning balance to tie out once it's tied out everything should move forward smoothly. Next we're going to plug in our ending balance we just manually do that from our bank statements so that's going to be the 101 590 05. So I'm going to say this is 101 590 05 let's make sure I got that right 101 590 05 101 590 05 this is going to be as of the end of February. So I'm going to say February 29 noting that you don't want to do a bank reconciliation generally from just your online banking list of transactions. You want to have the actual bank statement because that gives you a defined cutoff date which is going to be important for the reconciliation. I'm not going to be using these items down below I still think that these are kind of legacy type of items most people don't use these days because they probably have the bank feeds on. Therefore any service charges or interest earned would be put in place when you have the bank feeds. I also always kind of like to do it myself because I think these transactions can be confusing to people because it actually creates a transaction that might be in a different format than you're used to. So I'm going to go ahead and say all right let's start the reconciliation. So we have the similar process up top this is the statement ending balance. This is just the amount that we plugged in manually. This is the cleared balance. What does the cleared balance consist of? It consists of the beginning balance. So if I compare that to my statement here the beginning balance is now correct. Notice I can check that off as we go. This is the summary up top 61 to 41 85. So 61 to 41 85 and then we're going to have our payments or decreases and deposits. These will of course be populated as we start checking things off down below. Once we find everything that's on the bank statement in our system the cleared balance should be marked off and we should have a green checkbox ready to go down here. And we could still have some unclear items down below which we could which will be the reconciling items. Also just remember that if I go into this edit tab that's where the information is up top that we put in when we first started the bank reconciliation including the ending balance. Let's close this out. I'm going to minimize this. I'm going to start with the deposits as we did before. So we'll go into the deposits and just see those and let's go back and forth. I'm remembering that we typically want to go from the bank statement on back to because everything on the bank statement should be on our books. Everything on our books possibly will not be in the bank statement. So I'm looking first for this 3472 50 also recall that the deposits should be easy for us to reconcile as long as we have a good accounting system. So that we're not trying to tie things together meaning marking off multiple things on our books in order to match a singular deposit which can happen. If you have like credit card charges or cash that you're depositing into the bank as a lump sum which consists of actually multiple transactions. So you need to use the clearing account if that is the case. If you're finding the deposits to be difficult you're probably not properly using the clearing account so that your accounting system will result in a deposit into our books bank account in the same format that actually will hit the actual bank account. Okay so we have the date and we have the amount in our system from the bank and that should be enough to tie out especially if these are electronic transfers because the date will be very close. So 3472 50 let's look at that. We're going to go back on over here and say okay let's do it this way to do 3274 50 now this one you can see this was actually deposited in January. This was an outstanding item in January. It's clearing in February. There's the timing difference that we would expect to be seeing. So that looks good that's what we would expect to happen. Let's make this one green. We'll make it green and then we're looking for the 12,250 12,250 boom on 32 in our books. It's on 25 here so our books will always be earlier than the bank books or the same date possibly the 4508 70. So there's the 4508 70 and then let's mark that off and then we have the 750 the 750 is here. And then finally we have the 400 the 400 is here. Okay so everything is marked off that looks good. If I go back on over we'll say this one has been marked off we have found everything. So note that we found everything on the bank statement in our books that makes sense. We still have some things in our books that are not on the bank statement. That too could make sense as long as these are outstanding items that we expect to clear possibly in the following period due to the fact that we entered them in our system. But the bank doesn't know about them yet they haven't yet cleared the bank. So what would we want to do then we would want to look in our checking account as of the current day note that when we do the bank reconciliation we don't actually do it on like February 29. It's going to be sometime after February 29 in practice because we would have had to get the bank statement in order to start the process. And that would take like so it's probably going to be at least 15 days you would think or something after it might be sooner than that but it's going to be after that time frame. So we can look at our actual transactions to see if these did clear in the following month in March. If they did then it doesn't mean that they're wrong here it's not like we're going to change the date. It just means that it means that they're good they're legitimate there's just a timing difference so these will be the differences between our book balance and the bank balance. Also just realize that if you built your books from the bank feeds meaning you have gig work or you got paid by YouTube then you're not going to have these timing differences. Why because you're you're not really doing a full service accounting system you're just building your books from the bank feeds instead of double checking to the bank feeds which is a good way to do it in certain cases. But it's not like the full service accounting system. So you'd still want to reconcile in that case but in that case you would just check them all off they should all be good unless there's something funny going on. It should be a really easy process to reconcile if you're building your books directly from the bank feeds but you can't always do that as we've discussed and we'll talk more about the bank feeds in a future course or section as well. So that's going to be the general idea and so that looks good. So we haven't entered anything new if we get our total we're at the fifty one nine eighty one and that's going to be here the fifty one nine eighty one check that one is done. And so next time we'll continue with the decreases and wrap it up from there. Nothing new so we don't really need to look at the trial balance we haven't entered anything new let's just save it for later grab some coffee and then get back to finish it and finish it up after lunch or whatever.