Credit Card Best Practices

May 20, 1-2pm  |  Hermitage CD  |  🟣 Accounting
Credit Cards are just another Liability account.  Two easy ways to post the charges placed on the card and one simple way to post the payments to the credit card company.
with Celine Runyon

Media

Slide Presentation

Credit Card Best Practices Slides
File Size: 2203 kb
File Type: pdf
Download File

Outline

Just Another Liability Account
Credit Cards are just another Liability Account.  Credits increase the amount owed.  Debits decrease the amount owed.

Record the Charges
Charges placed on the Credit Card are recorded in two ways:
  • AP > Bills Due > Payment is a Credit to the CC Liability Acct.
  • Journal Entry as a Credit to the CC Liability Acct.

​Record the Payments
AP Payable to the Credit Card company is an AP Payable that Debits the CC Liability Acct. 

Perfect Balance
Goal achieved when the Liability account has a $0.00 balance.

Reconciliation
Ending Balance is a negative number.
Left side is Credits (charges).  Right side is Debits (payment to CC company).
Check the Boxes : Done!!