Quickbooks Online journal entry tutorial is about how to make journal entries in Quickbooks Online. There are times you need to make a journal entry to adjust certain accounts in your books.
If you are not familiar with making journal entries in Quickbooks Online then I recommend you don't make them. Debits and credits can get very confusing. However, if you are familiar, then this Quickbooks Online journal entry tutorial will walk you through how to do it correctly. Just remember that the total of your debits must always equal the total of your credits!Quickbooks Online Journal Entry Tutorial
So here we are on the QuickBooks
Online this is a sample company file
which you can get to through the gear icon when you are logged into your
company file if you have of a if you have a subscription you can go to the
sample company file to try things out so it's a great way to just go in and
play around and it's not going to mess up your company file all right so what
you're going to do you're going to go up to the new button you're going to see
other you're going to see journal entry and we're going to click that journal
entry brings up this field here and you'll see just plain old lines Journal
number date Etc it's very straightforward now what a journal entry does is it
adjusts accounts in your chart of accounts okay so debits and credits either
increase or decrease different accounts and what I mean by an account is
checking account savings account accounts receivable
prepaid expenses fixed assets
accounts payable bills loans those are all your accounts so in your chart of
accounts you've got all these accounts these journal entries will directly
increase or decrease depending if it's a debit or a credit uh those accounts
and so if you need to make an adjustment it could be depreciation that you need
to enter it
could be a prepaid expense that you're amortising over 12 months you are going to do a journal entry now I have some other videos on prepaid expenses and depreciation so please check those out okay so the first thing you're going to do you're going to make the journal date all right so uh usually in general this is going to be the end of the month you know so if you're making a journal entry generally it's going to be the end of the month it doesn't always have to be but we're going to say that this was as of August 31st 2022 journal entry number all right if you have a certain numbering system.
for example you know if we work in a client's file we will put you know the CPA firm name and I will put a dash and put my initials there that way the client knows that this was done by us and I did it and so everyone in our firm will put their initials so we know who made these journal entries so if you have a certain numbering system you can put that in here and you can also go up to this gear icon and you've got some options here that warn if a duplicate journal entry journal number is used you don't need to check that see it's it's basically unchecked right now we're going to cancel that we're not going to turn it on and the reason I recommend you don't turn it on is because you may use this like the multiple times and that's okay you can have the same Journal number all right so we're going to leave that as is so the first thing is you know in accounting any transaction you make affects two different accounts every single time it can't affect just one account.
for example if you spend money it's going to on an expense let's say office supplies it's going to reduce your checking account balance and it's going to increase your office supplies expense all right so every single journal entry has to have at least two lines because you have to have a debit and a credit and the total of all your debits and credits has to equal all right so let's say we did we went and we bought some office supplies and we used our debit card and for some reason instead of just going in here and entering expense we're doing a journal
entry we're going to say checking account and that gets reduced so a reduction to an asset is a credit so let's say we spent 125 dollars let's say 125 I'm going to tab over and you can put in your description and you can even assign it to a you know a customer or a vendor down here but you don't need to so this one we're not going to all right and then the next line so it's got to have an offsetting debit is this is going to be office supplies office expenses we'll put it as office expenses in this file and you'll see the debit will automatically populate okay so uh that way it balances you've got 125 you got 125 debits and credits equal this is a good journal entry and if this was all you were doing then you can say save a new or save and close and go on to the next one.
now let's say that we spent 125 dollars but we have to split it between two different accounts we're going to say that we only spent 75 on office expenses but in the same trip we also paid for equipment rental okay so let's say we went to the office supply store and we rented some equipment for 50 bucks so you can now split it between the two but you see now both of those add up to the 125 because the debits have to equal the credits so again you have to have at least two lines two entries one has to be a debit one has to be a credit you can have multiple lines and these things can get very long if you're adjusting certain accounts so now what we do if we hit save and close it's now going to record those expenses okay so if I go over here and I go to reports and let's pull up a profit and loss and we will make sure this is set for so it's uh we'll do it for last month all right so let me go down here last month run report if I go down to office expense where are we at right here 9308 and I pull that up you're going to see my 75 dollars is now showing as an expense and the other equipment rental 50 expense will also be in the profit and loss and in the checking account you're going to see a reduction of 125 all right so that's the basics of QuickBooks Online journal entries I hope you enjoyed this tutorial.
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