One of the benefits of QuickBooks Online (QBO) is the ability to connect bank accounts to your QBO account. First, click on Accounting in the Sidebar and create an asset account for the bank account to be connected. Then, click on the Banking button in the Sidebar. Next, either click on the bank’s logo or search for the name in the search bar. Then, enter your bank log-in information. QBO has a default to download the last 90 days of transactions. If you need to change the number of days, do so from the next screen when you select the account type. Finally, select the desired bank account from the chart of accounts and click on the green button.
Now after clicking on the Banking button in the Sidebar, you should see transactions in the Review tab. These are the transactions that QBO downloaded, but doesn’t know what expense accounts to put them into. You can create Bank Rules if every transaction containing certain words goes to the same expense account every time. For example, if every transaction containing the word “shell” in the bank text was to go to the Fuel account, you could create that rule and set QBO to automatically add those transactions for you. If some of the transactions containing the word “shell” are going to the Fuel expense account and others are going to the Travel expense account, this rule may not save you time. Instead, you would need to manually add each transaction.
Click on a transaction to set it to either add, match, or transfer. To add, simply choose the payee and expense/cost of goods account that the transaction belongs to. You can click on the Split button to divide the total expense between multiple accounts. When you are done assigning the transaction, click on the green Add button. You will see that the transaction moved from For Review to In QuickBooks.
If you enter and pay your bills or invoice your customers and receive payments within QBO, you will want to match the bank feeds to your transactions. This will prevent the expenses and income from being duplicated in your books. Deposits can easily be matched to multiple payments received in QBO by clicking on the Split button and entering the Payee and income accounts before adding the transaction.
When a bank feed transaction is a transfer between asset, liability, or equity accounts, you may choose to transfer the transaction instead of add. This works well for credit card or loan payments. Click on transfer and select the liability account to apply the payment towards.
For more information or help, contact the QuickBooks ProAdvisors at Ketel Thorstenson at 605-348-5630.