How To Record Credit Card Sales in QuickBooks via a Third-party Credit Card Processor
This article is part of a larger series onAccounting Software.
Our guide looks at how to record credit card sales in QuickBooks Online, particularly if the payment was accepted through a credit card. Recording credit card transactions by hand can be tedious, so you might want to consider using an integrated payment processor to simplify the process.
We hope that this tutorial, along with our otherQuickBooks Online training courses, will help you learn how to perform key tasks in QuickBooks Online, ourleading small business accounting software. If you have subscribed, follow along in your own account so that you can better understand each step illustrated. Otherwise, get a 30-day free trial or 50% off for three months.
As you’ve learned in our prior tutorials, customer payments can be recorded aspayments on outstanding invoicesor assales receiptsif an invoice was never issued. Whichever sales form you use, you’ll see similar fields on the entry screen, except that you need to select Credit Card (not Cash or Check) from the Payment method drop-down menu.
To record a credit card payment on an outstanding invoice, open the Receive payment screen by clicking+ Newabove the left menu bar and then selectingReceive paymentin the first column,Customers, as shown below.
Complete the Receive Payment screen by adding the necessary information:
A. Payment date:Enter the date you charged your customer’s credit card.
B. Payment method:Choose customer’s credit card payment processor.
C. Reference number:Enter the transaction number assigned by your credit card processor so that this transaction can be traced from QuickBooks to your processing account in the future (if needed).
D. Deposit to:Ensure the credit card payment is initially deposited to your Undeposited Funds account and not directly to your bank account.
If you haven’t already issued this customer an invoice, you’ll want to create a sales receipt instead of recording a payment received. To create a sales receipt, click+ Newat the top of the left menu bar and then clickSales receiptunder theCustomerscolumn. The Sales Receipt form requires the same essential information needed to complete the Receive Payment form, with fields labeled similarly.
Click theSaveorSave and send当你进入了所有必要的正的按钮ormation.
Most credit card processors will group multiple charges into a single deposit in your checking account. After your credit card processor transfers the funds to your bank account, you need to mirror the deposit by transferring the same credit card charges from Undeposited Funds to your bank account.
Match deposits.
If you don’t mirror the credit card processor’s deposits exactly, the individual deposits in your QuickBooks account register won’t match the deposits on your bank statement, making yourbank reconciliationdifficult.
Start the transfer from Undeposited Funds by clicking on the+ Newbutton at the top of the left menu bar and then selectingBank Depositin the far-right column.
Complete the Bank Deposit form with the required information.
A. Account:Click the drop-down box and select the checking account where the credit card processor deposited your funds.
B. Date:Enter the date your credit card processor deposited the funds.
C. Payments included:Select the credit card payments your processor included in the current deposit. Not all payments charged on the same day will be deposited into your checking account on the same day.
D. Amount:Verify that the total amount of the deposit matches the deposit from your credit card processor.
Scroll toward the bottom of the Bank Deposit form to complete theAdd funds to this depositsection.
E. Received from:Select the name of your credit card processor withholding a fee. If it’s a new merchant, click on+ Add Newfrom the drop-down menu, as shown below.
F. Account:Choose an expense account, such as “Credit Card Processing Fees.” You can click Add new to set up a new expense account.
G. Payment method:Select Cash as the payment method.
H. Amount:Enter the amount of the fee as a negative number. If your credit card processor subtracts a processing fee from the deposit, record the fee using a negative amount in this section.
Click the greenSave and newbutton to record your changes.
If your credit card processor charges fees other than those subtracted directly from a deposit, record an expense by clicking on+ Newfrom the left menu bar and then selectingExpensein theVendorscolumn.
A. Payee:Select the name of your credit card processor.
B. Payment account:Choose the bank account from where the expense was withdrawn.
C. Payment date:Enter the date the expense was withdrawn.
D. Payment method:Indicate Cash as the payment method.
E. Category:Select an expense account to charge the credit card processing fees.
F. Amount:Enter the amount of the credit card processing fees.
Hit the greenSave and closebutton when you’re done completing the expense window.
Integrated vs Nonintegrated Credit Card Processors
Integrated payment processors are directly connected to your point-of-sale (POS) system. So, there’s no need to enter your customer’s credit card details manually as they’re populated automatically, saving you and your customers valuable time.
Meanwhile, nonintegrated credit card processors don’t have the terminal and POS synced, so you have to enter credit card details manually when charging your customers. The lack of connection makes the checkout process significantly longer than integrated payment solutions.
While the right processing method depends on your needs, you should consider integrated credit card processors, like QuickBooks Payments, if you want a quick and efficient checkout process. As we illustrated inhow to process credit card payments, QuickBooks Payments is already in QuickBooks Online, and you only need to activate the service. Alternatively, you can install a third-party app from another credit card processor that integrates seamlessly with QuickBooks Online.
Wrap Up
You’ve just learned how to record credit card sales inQuickBooks Online. To automate the steps we went over, we hope you consider an integrated credit card processor likeQuickBooks Payments, which lets you record the payment received on either an invoice or sales receipt and takes care of the rest. Our series of free QuickBooks courses will now focus on preparing financial reports, beginning withhow to prepare a profit and loss (P&L) statement.