Huge Savings
Get our price list!
Buy with Confidence
from a Premier Intuit Reseller
Free Shipping
Direct from Intuit
No Sales Tax
(in some states)
Try it free for 30 days

How to Reconcile Cash Transactions in QuickBooks

Ruth, what would you do? I have a S-Corp that did his books mainly by journal entries. Most entries (95%) were debt employee benefits – meal and credit cash. Meaning that 95% of expenses were classified incorrectly. Bank Rec was also never done. would you start from scratch with the bank statements using the register – or would you reclass each journal entry?.
Yes, you absolutely need to enter and reconcile the bank statements. But since they credited cash, I’ve got a sinking feeling these didn’t run through the checking account.

If, as I suspect, there’s a large negative balance in the cash account, you’ll need to determine where the cash came from and check with their tax professional about how to book it. It’ll most likely be an equity and current liability account, depending on whether the funds are going to be paid back to the contributor.

If there’s a positive balance in the cash account, then everything’s probably okay. It means they’ve been transferring cash out of the checking account for these transactions, which is perfectly okay. But you should reconcile the remaining balance in the cash account to the actual cash on hand.

In either case, I recommend writing checks for cash payments. You get much better info, such as where the meal was purchased. Just don’t enter a check #.


Get free QuickBooks support and training!
LinkedIn   Google+   FaceBook

This article is provided for informational purposes and is not intended to be construed as legal, accounting, or other professional advice. For further information, please consult appropriate professional advice from your attorney and certified public accountant.

Ruth Perryman - QuickBooks Specialist Written by +Ruth Perryman

Ruth is the an Intuit Premier Reseller that offers great deals on QuickBooks POS and QuickBooks Enterprise. She has provided expert QuickBooks help to thousands of businesses all over the world since 1996.

Visit our webstore for great deals on QuickBooks and QuickBooks POS!

Comments are closed, but check out our LinkedIn groups: QuickBooks Tips & Tricks and QuickBooks Point of Sale Tips & Tricks