Banking and Reconciliation

Preview · ~54 min read · from QuickBooks® Online Step-by-Step

In this chapter we will look at the relationship between QuickBooks® Online and your banks. One of QBO’s hallmarks is its deep integration with online banking, allowing you to match and confirm transactions for accuracy, and automate routine data entry.

In this chapter

• The Bank Transactions Feed
• Opening the Sample File
• Connecting Your Bank and Credit Cards
• The Bank Transactions Interface
• Using the Bank Transactions feed for Data Entry
• Suggestions
• Uncategorized Transactions
• Splitting a Transaction
• The Posted Tab
• Purchasing Products
• Entering Transfers
• Using Find Other Matches
• Batch Actions
• Excluding Transactions
• Matching Credit Card Payments
• Customizing the Bank Transactions Feed
• Creating Rules
• How NOT to use the Bank Transactions feed
• Viewing the Bank Register
• Importing Transactions Downloaded from Your Bank
• Part 1: Setting Up the Statement
• Reconciling Bank Accounts
• Part 2: Getting the Difference to $0.00
• Part 3: If the Difference Still Is Not Zero
• Part 4: Analyzing the Remaining Transactions
• Finding Errors During Bank Reconciliation
• Bank Reconciliation Reports
• Reconciling Credit Cards
• Do It Yourself

Chapter review: Bank Transactions feed & reconciliation

12 practice questions. The answers are in the book.

1. When the Beginning Balance field in the Reconcile window doesn't match the beginning balance on the bank statement, you should:

   • Call the bank.
   • Repeat the most recent reconciliation to see if the missing transactions are waiting to be re-reconciled to $0.
   • Click the We Can Help You Fix It link.
   • Both b and c.

2. Which statement is false?

   • You can enter bank service charges using Enter Statement Charges.
   • You can sometimes enter bank service charges on the Reconcile window.
   • Bank service charges may come in through the Bank Transactions feed.
   • You can enter bank service charges using an Expense before you start your reconciliation.

3. To properly void an uncashed lost check from a closed accounting period:

   • Void the check in the register.
   • Delete the check.
   • Make a deposit in the current period for the same amount, and code it to the same account as the original check you want to void. Then mark both transactions as cleared in the Reconcile window.
   • Leave it in the register to remind you it was never cashed.

4. Which of the following columns cannot be displayed in the Reconcile window?

   • Ref No..
   • Class.
   • Date.
   • Payee.

5. You know you have reconciled your bank account correctly when:

   • You make a Reconciliation Discrepancy entry.
   • The Difference field shows 0.00 and there are no unexplained entries left on the list.
   • You have marked off all the transactions on the bank statement, even if there duplicates remaining.
   • All of the above.

6. The Reconciliation Report shows:

   • The Beginning Balance shown on the Bank Statement.
   • All the transactions on the statement for the month.
   • The actual Register Balance as of the reconciliation date.
   • All of the above.

7. What accounts should be reconciled?

   • Most Balance Sheet accounts.
   • Only accounts that receive regular statements.
   • Any bank, income or expense account.
   • Only bank accounts can be reconciled.

8. You should connect which accounts to the Bank Transactions feed?

   • Business checking and savings accounts.
   • Business credit cards.
   • Personal accounts if the owner commingles funds.
   • Both a and b.

9. All sales income in the Bank Transactions feed should:

   • Be entered by hand.
   • Be Excluded, since the sales receipts and invoice payments are already in the system.
   • Be ignored.
   • Match with Bank Deposits.

10. In what account is a transaction created if you complete a reconciliation and your difference is not 0.00?

    • Opening Balance Equity.
    • Uncategorized Income.
    • Reconciliation Discrepancies.
    • Other Expense.

11. Your Net Income is vastly overstated. What could be causing the problem?

    • Deposits were added through the Bank Transactions feed instead of matched to existing sales transactions.
    • Incorrect transactions in the checking register that were left unreconciled.
    • Vendor checks still haven't been cashed.
    • Both a and b.

12. If the Bank Transactions feed shows an incorrect Payee or Category, you should:

    • Click on the transaction and enter the correct information.
    • Stop using it because something's wrong.
    • Add it as is - QuickBooks® Online must know what it's doing.
    • Use Find Other Matches to update the information.