How to Record Journal Entries in QuickBooks
Accounting transactions could possibly get entered incorrectly into an accounting system, or simply a transaction need to have been split up into two different general ledger accounts, for example.
Either way, when this happens you must make modifications to your original transaction after it has been recorded, and you may do this easily in QuickBooks accounting software by simply making a journal entry.
You may make journal entries in QuickBooks to modify or correct transactions and post entries that can't be performed in other ways, such as for example adjustments to profit or loss.
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The journal entry process is rather straightforward, you could only make a journal entry for one customer or vendor at any given time. Should you want to correct multiple customer or vendor balances this way, you'll have to post separate entries.
What exactly is a Journal Entry?
A general journal entry is an accounting transaction this is certainly entered, or posted, straight to the overall ledger. A business's general ledger will act as its main band of accounts used to record balance sheet and income statement transactions.
For instance, you may possibly have entered the monthly $100 utility bill into the company's insurance expense account by accident. You can easily post an adjusting journal entry to reduce, or credit the insurance coverage expense account by $100 and increase, or debit the utility expense account by $100 to fix your mistake. All your valuable accounts would then be in proper order, and you also would not need certainly to replace the balance due by the vendor because that part of the transaction was recorded properly.
Journal Entries for Year-End Activities
Your certified public accountant or bookkeeper might want to make journal entries to perform year-end activities, such as for instance posting tax adjustments to your books, recording depreciation expense or reclassifying revenues and expenses. Your accounting professional can offer you with specific information if you wish to post the journal entries yourself at year's end, along side explanations for why the entries were essential for your particular situation.
How to Make General Journal Entries in QuickBooks
You can make general journal entries in QuickBooks by using these step-by-step instructions:
Go to Company > Make General Journal Entries from the menu towards the top of the screen.
Change the Date field, if necessary, when you look at the Make General Journal Entries window. QuickBooks will default into the current date so if you like to post an entry for a previous month or year, make sure to change it out so your entry gets recorded in the proper financial time frame.
Enter a number for the journal entry in the Entry No. field. QuickBooks will automatically number subsequent journal entries sequentially.
Enter the general ledger account number within the Account column. You can choose the first account from a drop-down menu in the Account column.
Enter the debit or credit amount for the account you have selected into the Debit or Credit columns. The debits and credits must be equal to make the entry balanced and permit QuickBooks to post the entry.
Enter a descriptive memo in the Memo Column. It's going to be displayed on reports such as this journal entry. This task is optional, nonetheless it's recommended so that you'll remember later why the entry was made.
Repeat Steps 4 through 6 through to the entries completely offset each other while the transaction reaches a zero balance. Your total into the Debit column should equal the total into the Credit column, therefore the journal entry will then be properly balanced.
Click Save & near to save the journal entry and close the window, or click Save & New to save the journal entry and open a new window.
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You can make most general journal entries in QuickBooks making use of these steps, however, if you intend to make journal entries that affect a certain customer’s account receivable or a vendor’s accounts payable, you need to place the customer or vendor in the first line of the entry.