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.
  1. Select the Plus icon (+) at the top, then Journal Entry.
  2. In the Journal date field, enter the transaction date.
  3. (Optional) Enter a Journal no. to help you identify the transaction in the reports.
  4. 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.
  5. Continue to enter distribution lines until the sum of the Debit column entries equals the sum of the Credit column entries.
  6. (Optional) Select Make recurring to set a recurring journal entry schedule.
  7. Save the transaction.

To learn more about entering journal entries in QuickBooks Online, watch this tutorial video:

 

A few things to remember:

  • QuickBooks Online does not support multi-currency in a single journal entry. This means each currency must have its own journal entry because multiple currencies sometimes do not convert to the correct rates.
  • For the journal entry to show on either the Sales or Expense tab, the entry must have a line for either Accounts Receivable or Accounts Payable and the name of the customer or vendor (supplier).
  • If you are using QuickBooks Online Plus and the Classes and Locations feature is turned on, you will see additional columns for Location and Class.
  • You can delete or reverse a journal entry if you need to correct the transaction or if the entry was created by mistake.
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