Credit Card Awards in the form of Cash

[Denise]

We do our billing a little differently in that we do not have our credit cards listed as liabilities.

We just pay the credit card bills as they are due each month and credit the departments the individual purchases were for and debit the expenses or line items.

This helps us keep track on our I & E statements as to where the charges on our credit cards are going.

We have used our Visa card for about 3 years or more now, not knowing they had a reward system. When we found out, they told us we had a cash reward of approx. $1,500 that would be applied to our card - bringing our balance due down that amount.

My question is since they are applying the $1,500 directly back on our card, thereby reducing the amount we owe on the purchases we have made on the card, how do we go about showing what purchases were made since the bill for purchases is now $1,500 less than what it was?

Thank you for any help you can give me.

[JohnDMeyers]

Technically, your expenses were not reduced. Each vendor got the precise amount you owed them.

You received 1% "interest" income. I would treat it like that.

[Matt]

You'll need to set up an income account called "Rebate Income" or something similar. Then, let's say the total purchases for the month were $2,000, the rebate was $1,500, and so the actual check you need to cut to pay the credit card bill is $500. The entry to post this would look as follows:

Debit Expense $2,000
Credit Rebate Income $1,500
Credit Checking Acct $500

[Denise]

Thank you so much for your help.

[GFCOfficePC]

I have the same issue with Discover Card. We us the Liability Module also!
What you have mentioned will surely help in the Reconciliation!

However... I wish PowerChurch would consider a Credit Care Area as QuickBooks have. This what just reconcile as you would a Bank Statement!
Thanks