In traditional accounting, a journal entry is a transaction that has at least two parts - a debit and a credit. As a rule, the total of the Debit column is always equal to the total of the Credit column.
When you record a transaction with a Journal entry, QuickBooks Online labels the transaction as Journal in the register (or account history) and Journal Entry on reports that list transactions. Use a journal entry if:
- You need to transfer money between income and expense accounts.
- You need to transfer money from an asset, liability, or equity account to an income or expense account.
- You prefer the traditional system of accounting, that is, entering debits and credits in a general journal or ledger.
To create a journal entry:
If you are not sure which account receives the debit and the credit side of a transaction, consult your accounting professional for guidance.
- Select the Plus icon (+) at the top, then Journal Entry.
- In the Journal date field, enter the transaction date.
- (Optional) Enter a Journal no. to help you identify the transaction in the reports.
- Enter the first distribution line.
- Accounts: Any account in the Chart of Accounts.
- Journal Code (France only): Enter the journal code associated with the account. You can add a new journal code if needed. You must use the same journal code for both the debit and credit accounts associated with the transaction.
- Debits or Credits: Often the first line is Debits. After you save the transaction, find it in the Recent transactions report to see if Debit had the desired effect.
- Description (Optional): The description you enter appears on reports showing transaction details.
- Name: Choose a customer, vendor/supplier, or employee associated with the line, if any.
- Continue to enter distribution lines until the sum of the Debit column entries equals the sum of the Credit column entries.
- (Optional) Select Make recurring to set a recurring journal entry schedule.
- Save the transaction.
To learn more about entering journal entries in QuickBooks Online, watch this tutorial video:
A few things to remember: