Welcome to the Fit Small Business QuickBooks Online training course! In this lesson, we’re going to cover how to record bank deposits in QuickBooks Online. To follow along with me, log into your QuickBooks Online account now, or click the link below for a free 30-day trial of QuickBooks Online.
To complete this lesson, you can either watch the video below, read through the step-by-step instructions, or do both. Let’s begin!
Before we get started with the lesson, it’s worth mentioning that there are affordable virtual bookkeepers that can set-up and manage your QuickBooks for you. They will even help you get caught up if you are behind. For example, SmartBooks offers help with cash flow management, monthly financial statements, payroll processing and more starting at $250/month. Get a free consultation to learn more.
Why Is It Important to Record Bank Deposits in QuickBooks Online?
You need to record a deposit in QuickBooks if you receive a check from someone other than a customer. As we discussed in the How to Receive (Record) Payments lesson, customer payments are not entered as deposits.
Some examples of the types of checks you might need to record as deposits are:
- A refund check from a tax authority
- A rebate check from a vendor
- Insurance claim check
Pro Tip: When depositing payments for your business, it’s imperative to use a business checking account that’s separate from your personal accounts. This will prevent you from commingling funds and potentially pierce the corporate veil. We compared a range of options for small business owners and Chase came out on top. First-time account holders are eligible for up to $200 bonus.
How Do I Record Bank Deposits?
Step 1 – Navigate to Record Bank Deposits
To begin, from the Home Page, click on the Plus sign at the top and select Bank Deposit right below the Other column on the far right.
Step 2 – Record the Bank Deposit
The record deposit window will display as indicated below. We will complete the following fields for a deposit for Paul’s Plumbing.
- Bank account – Select from the drop down the bank account that you want to deposit this check to.
- Balance – this is the current balance in the bank account you selected.
- Date – this is the date that you will make the deposit.
TIP: The date that appears here affects how this transaction shows up on your financial statements. Be sure to enter the date as close as possible to the actual deposit date.
- Received From – select from the drop down the person or business that you received the check from. If you have not set them up in QuickBooks, you can do so here by selecting Add new from the drop down menu.
- Account – select from the drop down the account that you want to track this deposit. In the setting up the chart of accounts lesson, we walk through step by step how to set up accounts.
- Description – type a description here that will help you to identify what this check was for.
- Payment method – select the payment method.
- Ref no. – if the payment method is a check, type the check number in this field. Otherwise, you can leave this field blank.
- Amount – enter the amount of the deposit.
- Cash back goes to: select the petty cash account here if you plan to get cash back.
- Cash back memo: indicate here if there is a specific purpose for the cash back
- Cash back amount: enter the amount of cashback you plan to receive from this deposit.
- This is the total amount of the deposit less the cash back amount.
Once you have completed all of the fields, Save and Close.
Review the Bank Deposit in the Check Register
Be sure to review the deposit once you have saved it to ensure all of the information is correct. Follow these steps to review the deposit:
Step 1 – Navigate Back to the Home Screen
From the home page, select Transactions and then Banking from the left menu bar as indicated below.
Step 2 – Click on the Go to Register Button
The most recent transactions will appear at the very top as indicated below. Review the information to make sure it is correct. If you need to edit any information, follow the steps below.
How Do I Modify (edit) a Bank Deposit in QuickBooks Online?
Step 1 – From the check register, click on the deposit that you want to edit as indicated below.
Step 2 – Make the necessary changes and then click the Save button as indicated below.
What Impact Does Recording Bank Deposits have on the Financial Statements?
When a deposit is recorded in QuickBooks, your accounts and financial statements are affected as follows:
|Account Affected||Impact on Account||Financial Statement|
|Checking Account||Increase||Balance Sheet|
|Other Income Account||Increase||Profit & Loss Statement|
That wraps up the section on how to record deposits in QuickBooks Online. The next lesson in our QuickBooks Online Training Course will be how to transfer money between accounts. In this lesson, we will walk you through how to transfer money between bank accounts.
To access this lesson or any of the others in the series, click here. Or, click here for a free 30-day trial of QuickBooks Online.
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