Is there a preferred procedure for entering credit card balances under ‘Accounts?’
I would like to know specifically how to set the account type (if this is necessary)?
Should I be entering the starting balance as a negative number?
I would treat credit card as a bank account, therefore I would create credit card under “Bank Accounts” tab and set opening balance as negative and then manage this account as if it’s just another bank account.
I tried using my credit card account as a bank account like you said but my export from my bank in .qbo format seems to have the transactions in inverted balances - charges made using the card appear as negative numbers and as Payments and payments to the card balance appear as positive and as Receipts. I understand the idea of them being positive and negative but showing as Payments and Receipts in a fashion that’s the opposite of what I’d expect is surprising. I’m assuming this is an accounting convention that I’m unaware of but if not, might we need a special type of bank account to accomodate credit cards?
I’ll probably change the terminology. It appears “Payments” / “Receipts” terminology is confusing.
Charges made using the card = Money Out = Payments
Payments to the card balance = Money In = Receipts
So perhaps I shouldn’t be calling these transactions receipts/payments but simply money in/money out. Would that make it more clear?
Yes Lubos, I would like to see simple terminology (Money in/Money out). Accounting for small businesses should be simple just like Apple…a simple computer revolution.