Credit card payments
Payments by credit card
can usually be entered as deposits into the bank account, if this represents the actual transaction. XE "Credit card payments" XE "payments:credit card" These accounts generally deduct a service charge each month, based on the volume of business. The service charge is best handled as an ATM purchase, that is, as a check with no check number (and not to be printed.)
If the credit card company
requires direct transmittal of credit
purchase documents, a separate bank account
is needed. (It may not seem like a bank
account, but other account types lead to
complications.) These cards usually
require a deposit recorded as net of the
service charge. The service charge
would be shown as a negative amount on the
deposit record, going to an expense
account.
Each month, the credit
card company returns a check, which will be
deposited in your bank account. Within
QuickBooks, a deposit is not the optimum
record. The money is already recorded
as in your possession. The effective way
to handle the transaction is by writing a
check in the credit card account. The
opposing account is your real bank account,
which will receive the money as a
transfer. Because of reasons internal
to QuickBooks, the credit card account should
be reconciled.
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