Tracking Credit Card Purchases with Quickbooks

As I mentioned in my last post, I pay for a lot of business expenses with a credit card and track it all in Quickbooks (QB). I use the online version of QB ($40 a month). Here's how it works:
In QB you need to create an account for the credit card. It lets you choose a type of account...make sure you select Credit Card.

In order to have the card activity loaded into QB automatically you first need to register your card for online access with your cardholder. My cards are American Express so I registered them at www.americanexpress.com. You need to have your card information and your login information to get things set up in QB. Basically you are allowing QB to log into your credit card account using your credentials and extract the info.

Once the account is set up and your credit card is set up online, go to BANKING / DOWNLOADED TRANSACTIONS.
On the left side of the screen you should see an ADD+ button.
When you click ADD it will ask you for your financial institution.
Type in the name of your card issuer or choose from the list.
QB will ask for your username and password for the credit card account
Follow the prompts

I download my transactions periodically (maybe once a week) by selecting BANKING / DOWNLOADED TRANSACTIONS then clicking UPDATE over on the left. QB logs in and imports the transactions. They will appear on the right on the Unaccepted Transactions tab.
Before you accept each transaction you want to give it a category - tell QB what it is for. Use the drop down menu to select the appropriate category. For instance, if the charge is for AT&T, you would use the category Telephone (or utilities...whatever you are set up for). If the charge is for inventory that you are going to resell you would give it the category of inventory. After you categorize it, click ACCEPT and the transaction is recorded and it moves to the accepted transactions tab.

What I like about his method is that I don't have to enter every purchase individually. Most of the info downloads (vendor, date, amount) and I just need to categorize it. I also like that I am writing one check to the credit card company instead of multiple checks to multiple vendors.

And I just must reiterate - use credit cards responsibly! Don't charge it if you don't have the cash for it. Credit is a very slippery slope and you can literally destroy your business if you are not careful. By the way, I haven't tried it, but I bet this system would work with a debit card as well.