QuickBooks: Enter Credit Card Charges vs. Enter Bills

On the QuickBooks Home Page you have probably noticed there is an “Enter bills” icon on the Home page as well as an “Enter credit card charges” icon.  You may wonder which to choose and when.

 

A purchase made with a credit card should be posted to “Enter credit card charges” rather than through “Enter bills”, because purchases made with a credit card are posted immediately by the credit card company & there is no bill to be paid.  Always use this method when you are entering credit card transactions directly from the credit card statement.

When an expense is posted through Enter credit card charges, only one entry needs to be made and the following occurs in QuickBooks.

DR            CR

Expense acct        $999

Credit card                              $999

Alternatively, when you receive a bill from a vendor which you plan to pay at a later date with the credit card, then that expense should still be entered now to be recognized in the proper period.  This is when it is appropriate to post the bill through Enter Bills.  Then when the time comes to pay the bill with the credit card you will record that step through the PayBills screen (see our archived Solution “Paying Bills With a Credit Card” from Dec. 23, 2012, http://svaccounting.com/solution-archive/, for more details on recording the bill payment paid with a credit card.)

Looking For More?

Comments

Silicon Valley Accounting Solutions produces the Solution of the Week in order to share tips and shortcuts that promote process efficiency and highlight software features that may not be in your current toolbox. Please let us know if you have questions on how to accomplish a particular task or if you simply have a comment to share.

Even if you find that you know most of what you see here, it only takes one “Aha” to make regular visits worthwhile. To avoid missing any solutions, you may subscribe and have a new one delivered to your inbox each week.

Contact Us

We want to help you grow
your business, call us
at: (408) 844-4216 or
find out more here.

Controllership

When you need:
  • Clear processes for cash controls
  • Analysis of results
  • Customized reporting

Accounting

When you need:
  • Timely and accurate bookkeeping
  • Reconciliations and monthly closes
  • Familiarity with popular accounting software
Web Analytics