QuickBooks Pro Plus desktop 2022 bank reconciliation month number one deposits Get ready because we bookkeeping pros are moving up the hilltop with QuickBooks Pro Plus desktop 2022. Here we are in our get great guitars practice file going through the setup process with a view drop down the open windows list on the left hand side company dropped down homepage in the middle maximize into the gray area reports drop down company and financial looking at the balance sheet,
00:30
we’re going to be changing the report or customizing it looking at just the first month on the range change which is going to be Oh 10122201 31 to two the first month of operations for our practice problem, fonts and numbers changing the font size bringing it on up to 14. Okay, yes, please. And okay, the focus here on the checking account, we’re going to go into the bank reconciliation, which we started last time, we just took a look at it with the overview last time banking drop down, reconcile, we are going to make an adjustment to this beginning balance here, I did make an adjustment to our practice bank statement.
01:09
So we’re imagining this being the bank statement from the bank, the bank recording our transactions. And we added a little bit these two transactions on down below from the prior presentation. So be aware of that. And if you have access to this file, you will it will be this updated file here. If not, then we’ll just follow along along with the presentations going back and forth from this mock bank statement to the data input. So we’re looking at the 61 241 85, the 61 241 85, which is now this amount 61224 1.85 there make sure that’s your ending balance six went to 4185.
01:48
If you’re following along here, we recall that the beginning balance does not tie out to what we have on the bank statement, we have 30,000 here, and we only have the 25,000. Here, that could often be the case, if you’re doing your first bank reconciliation, as we discussed a bit in the prior presentation. In our case, we had to put the 25,000 in there instead of the 30,000 because that is what was on our prior bookkeeping books. And so we had to do that in order to be in balanced to tie into our prior account balances. Why would it be different than what’s on the current bank statement, it may be different because we might have had some items in our prior year books.
02:31
As of the end, let’s go back over here of 1231 of the prior year. That was that was we recorded that had not yet cleared the bank. And therefore the bank, for example, had a higher number than we had as of the end of last period. And you can see down here, the difference is 5000. So it’s going to be this these two transactions down below, which are accounting for those two, those two items that we’re going to have to basically be accounting for. So let’s go back on over. And that’s gonna be the 65,
03:03
we’re not putting any service charges or interest earned not because we don’t have those items, but because I think it’s easier to reconcile those items when we go through the bank reconciliation process. So I’m going to go ahead and continue. So we’re going to continue on. And we went through kind of like the generalities of our reconciliation. And we have, the first thing we have here is this 25,000 as kind of a problem in terms of the beginning balance. Now there’s a couple ways we can deal with that. And we’ll go through that I’ll deal with that a little bit more in detail.
03:36
After we enter all the data, the thing that’s going to be a little bit unusual, is that if we’re if we enter all the data in, you’ll get to see, you know where this difference is going to lie. And we’ll actually be able to reconcile with it without basically checking off basically these two items and the beginning balance. In other words, if I look at that 30,000 Right there. And these two items, the 4000 and the 1000, they net out to the beginning balance we have on our books, which is the 25,000.
04:07
So if I start at 25,000, and I check off all the activity in the end the bank statement, except these two, then then I’m going to end up being able to reconcile, however, if I do that, that’ll be one way you could do it. But if you do that, then you don’t have these two that have shown as cleared in your current accounting system. So we’ll go back and kind of make the adjustment after that. So we’ll kind of see how that washes out. We’ll see how this beginning balance problem washes out in the end.
04:39
But first we’re going to enter the activity of the 65,000 to 50 to 7005 on the deposits, then we’ll enter the decreases and then we’ll see how what’s gonna play out with regards to this beginning balance problem and look at various ways that we can deal with it at that point in time. Alright, so the so the deposits are the ones we’re going to start to check off First, and we’re just going to check them off as they line up. And with the deposits, usually the date will be pretty close.
05:07
And usually you will have the the dollar amount that should tie out, if you were able to put the information into your system in a similar fashion as it had been put into the bank, into the bank account, remembering that if it’s not in the same format, going back to the homepage, you will have to be using in some way, most likely the undeposited funds in a more efficient way. That’s what the undeposited funds is for. So that you can then group your deposits in the same format as they’re going to be on the bank statement, making the reconciliation easy.
05:40
So if you have credit card statements that are depositing in a different way, as you’re putting them into the system, as they’re hitting the bank account, you got to use undeposited funds, or figure out a way to deposit those together to possibly needing to talk to your credit card company and your bank to make that happen. And then also, if you have cash transactions, multiple cash transactions, then clearly when you go to the bank, you need to deposit them in the same format in the bank, as you make the deposit using that undeposited funds, as we’ve discussed in the past, if that is the case, then the reconciliation could be quite easy.
06:15
Because you could just type out the dollar amount and the deposit, the date will be pretty close as well, because there’s not going to be too much lag with the deposit side of things. If they’re electronic transactions, they could sometimes even be easier to some degree because those should clear quite quickly. And you might have added detail, including say Who paid you in that case, include like the like, because you have an electronic memo, and so on, which will tell you who kind of paid you as well.
06:44
So it gives you another kind of line item of data that you could use to reconcile, okay, so we’re just gonna, when we reconcile the general ideas, we’re going to be going from the bank statement to our books, now you’re gonna probably go back and forth. But just remember, if you get confused, you’re trying to reconcile, reconcile from the bank statement to the books, because everything on the bank statement should be on our books. But it’s not necessarily true. The other way around, everything on the books may not be on the bank statement, because we might have outstanding items.
07:14
So let’s just go through this one by one, here’s 260 5000 on one, three, going over here. Also note that I can hide transactions after January, let’s click that off. Here’s the 65,000. Here, it’s on one one here, notice the date is before, when it cleared the books, that’s going to be the typical kind of case, it should be within one to three days, you would think on the deposit side of things. So then I go back on over, you might then highlight this, if you had a highlighter, if you had printed this out might say okay, that’s yellow now. And then 50,000 on one 550 1000 on one, five, there it is. We wrote it on one, two, it cleared on one, five.
07:53
So that looks like the same one that makes sense, the dates won’t line up exactly, but you would think they’d be pretty close to 7005 7085 on 124. So 124, it was here on 120. So that’s pretty close looks like the 7005 7085 Looks good. And then we have the 20,500 on 124. There’s the 25 20,500 on 124 checking it off. Notice that’s where the deposits end. Even though on our books, we have this 34,072 50 that still hasn’t been checked off. That was that was entered on 125.
08:31
So that amount we would expect then hopefully it’s going to clear on February in the next bank statement, it just hasn’t cleared yet. Now this one’s pretty close, it’s 125. So you would think it hasn’t cleared yet it’s been like five days, notice that we can easily check that we can go to the bank and go into our online banking, say did it clear in February. And if it did, then we’re probably gonna say, Well, that’s good, then it cleared in February, I’m not worried about that particular deposit so much because I know it cleared when I’m doing the bank reconciliation, it’s going to be some point in time after the month end.
09:06
So if this is as of January 31, we’re going to be doing it sometime in February or after. And so I’ll be able to have the capacity to go in and double check that that has cleared, giving me peace of mind that I’m not missing that huge deposit. But I can still keep it as unchecked off here. So it’s a reconciling item. So as of this point in time, the bank does not yet know about timing difference. If that is the case, which is going to be one of our reconciling items being the difference between our books, and the bank books at the end of the day.
09:40
Our books currently at the 88 810 25 bank books currently at as of the same date 61 241 85. So it’s a substantial difference, in part due to that substantial deposit there. So that’s going to be that’s going to be the deposit side of things. And then next time We’re gonna go in, and we’re going to do the same kind of thing on the checks side of things. And then we’ll look and see if we have any items on the bank statement that we haven’t recorded on our books reconcile for those.
10:12
And then we’ll get into some more detail on this beginning balance kind of issue and see how that plays out. After we’ve checked everything off, notice that you can leave the bank reconciliation it by going down here and say leave and then go back into it, it should save the data and the transactions.
10:27
Notice here that we have the 25,000 beginning balance, we got the deposits now, we’re still of course out of balance here until we check off the other side of the transactions and then we’ll have to deal with that beginning balance issue and see how best to deal with that. So we’re just gonna say leave at this point in time, and we’ll be back for the next half next time.