Accounting & Bookkeeping

Recording of credit card transactions with undeposited funds


It is always challenging to manage recording of credit card transactions with undeposited funds. However, with Meru Accounting everything seems easy. To know how to record credit card transactions, read this blog post:

  1. Undeposited Funds feature in QuickBooks
    • On receiving payment, QuickBooks gets intimated once you record each payment. Therefore, make a choice depending on how you want QuickBooks to deal with the deposit.
    • We can also use a payment item on an invoice or as an entry of a sales receipt.
    • Then, set the undeposited funds account by default to automate transfer of payments made by customers that you receive at your end. Thus, this account acts as a buffer to hold the amount until you further deposit the amount in the bank account and the QB register tallies its figure with that on the bank statement.
    • Provides option to deposit directly to your bank account with the option “Deposit to”. Instead of gathering funds and then depositing them with the Make Deposits window, it transfers the funds to the respective bank account.
  2. Ease of recording transactions using undeposited funds
    • Payments can either be ‘automatically’ or ‘manually’ deposited depending upon your option preference between “Bank Register Window” and “Group with Undeposited Funds” option.
    • Recording the transactions or payments in the Undeposited Funds account, makes the reconciliation of the bank statement with AccountEdge records easy.
    • User-friendly steps to enter funds within undeposited account:
      • Launch accounting software
      • Click on the list from the navigation menu
      • Select items tab from the drop-down menu
      • Choose the required payment type
      • Fill in necessary details and information on the funds to be added
      • Click on the Accounts option and choose the desired account for undeposited fund
      • A final click on the Ok option to create the undeposited account
  3. Working on uncleared transactions in undeposited funds
    • You need to look upon uncleared and cleared transactions in order to avoid any trouble during period closure or report filing.
    • We should take regular and frequent to keep the holding account clear and also display a zero balance on an approach of the closing of the accounting period.
    • Steps to work on uncleared transactions in your undeposited funds involve:
      • Select Banking-> Make Deposits
      • Make a list of items to you need to clear
      • Move to the next line of the deposit enter the account where the original transactions where posted
      • Note in the Memo field to show an entry for clearing an old transaction
      • In the amount column, enter a negative figure meant to offset the original
      • incorrect transaction.
  4. Journal entries for undeposited funds
    • You need to maintain records for transactions that are in your undeposited funds account. Writing the journal entry involves 5 basic steps:
      • Date of the transaction
      • The debit and credit account details, from undeposited fund account to your bank account
      • A match between the figures involved in the debit and credit
      • An explanation of why the transaction has taken place

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