How to handle an automatically charged and recurring monthly payment for a service

US QuickBooks Pro for Windows : 2009

I have an online service which I use as an end-user support tool. This service is billed to a company DEBIT card on a monthly recurring basis. I get an e-mail the day it bills as a receipt for the charge. The charge is a fixed amount and it occurs on the same day of the month. This is a general cost of doing business charge, which is not associated with any specific customer, as it gets used to support all customers. I am not interested in trying to allocate portions of this cost against any customers.

What is an appropriate method to handle this charge? Up until now, every use of the company debit card has been for point-of-sale type transactions (food, online equipment purchases, etc). I enter these items using the "write checks" feature. Should I handle this recurring online service charge the same way, or does this put me at some kind of disadvantage in terms of tracking/report/other?

Dear HD Clown:

You can handle in a couple of ways:

1) enter it as you would any other check, as it is basically a withdrawal from your checking account. You can enter it when you get the email receipt. You can also enter it on the 1st of the month, since you know it will be coming thru, then it is already deducted from your check register, before the transaction hits your bank, which helps keep your QB check register balance accurate. Then when you do your bank reconciliation, it is already entered.

2) enter it once as a check, then memorize it, and have the memorization feature enter it automatically at the same time each month. You can have it "ask you" before entering it or just have it "automatically" entered it for you, then you can later check it for accuracy.

3) or a combination of the two methods I described above.

I teach my clients to enter all of their regular/standard monthly charges some time in the 1st week of the new month, that way they are always entered and won't get "lost. "

This way you always know what the "real" QB check register balance is.

Also, if these are entered early in the month, they will show up on your P&L, if you print one during the month, as a tracking tool, assuming you use the accrual method.

If using the cash method, enter them as they are billed.

Sincerely, Leslie Anne Smith, Smith Business Services

Leslie Anne Smith,
Smith Business Services