User Support Forum

Good morning!

We have been using credit cards for a couple of years now but I would like a better way of accounting for purchases on them. We have version 11.1 of PC+.

Right now, I collect all the receipts and enter everything into an invoice when the bill comes and then cut the check. That works ok, but I would like to start accounting for everything as the receipts come in, in the proper month the expense is made, and then cut the check using a liability account. I found this info by doing a search in this folder and this is how I plan to set it up:

The correct way to do the accounting for credit card charges is as follows:
1). Purchase made: Debit an expense account and credit a liability account.
2). Paying the statement balance: Debit the liability account and credit the checking account.

My question is, is this all I have to do? Or, do I need to reconcile this when the credit card statement comes in? Is there a way to do that in version 11.1?

I appreciate this forum, I can find answers to most of my questions by searching, but I just couldn't find anything about specific to my version.

Thanks so much!
Denise

That sounds like all you will need.

As far as reconciling the credit card liability, the Reconcile Bank Accounts tool has been redesigned in Version 11.55 to work for both bank accounts and credit accounts. That update was not made in Version 11.1.

If I remember correctly, you can still pick a liability account on the Reconcile Bank Accounts screen in Version 11.1, but all the calculations will be backward and the deposit/withdrawal lists will be backward.

Zorak wrote:That sounds like all you will need.

As far as reconciling the credit card liability, the Reconcile Bank Accounts tool has been redesigned in Version 11.55 to work for both bank accounts and credit accounts. That update was not made in Version 11.1.

If I remember correctly, you can still pick a liability account on the Reconcile Bank Accounts screen in Version 11.1, but all the calculations will be backward and the deposit/withdrawal lists will be backward.

FWIW ... I use this method in v11.55, and I create the transactions in Accounts Payable using Manual Checks, and a check number of OFC-CC. In this way you have an audit trail of the vendors you purchase from using the Credit Card, plus it eliminates having to track down receipts and figuring out which ministry should be expenses. Doing this as the receipts come in makes it so much easier.

I reconcile the Credit Card each month when I receive notice of the bill being available for download. I print a copy of the credit card bill, and staple the reconciliation report and receipts to it for file. I then create the invoice for the credit card company

FWIW .. this, and a few feature additions make it worthwhile to update to 11.55.

Great, thanks for the replies!

I'll give it a go and see if this method works better for tracking expenses as they come in.

Thanks!
Denise