Employees regularly use personal credit cards for major and minor purchases and while reimbursing them using QuickBooks is a handy way to record them. They must know how to track reimbursed expenses in Quickbooks to make sure that they track all minor and major expenses. Thus, there are two options of reimbursing the employees. When you wish to pay on the transaction day, you can also create an expense transaction and select the liability account. Among all the expenses luckily a few are reimbursable and it incurs in course of running the business like subsistence or travel expenses.
Some people can pay such expenses out of their pockets and also reclaim the same from the firm on a weekly and monthly basis. For keeping your accounts in order, you need to track and record all the reimbursed expenses. The QuickBooks business accounting software can also include a tracking tool like a part of the Expenses and Time features you use for keeping tabs on such expenses and also assign the same for the expense accounts of the company.
Steps For Tracking Reimbursed Expenses
For such a case you would have to launch QuickBooks software. Now sign in after inputting the username and the password of the administrator.
- On the main menu bar click on the tab edit and choose the option “Preferences” from the drop-down menu.
- Click on the option “Time and Expenses” in the list of options you see in the window Preferences.
- Click on the tab “Company Preferences”
- Now click to choose the “Track reimbursed expenses like income” check box and choose the button “OK”. Now that you enable reimbursable costs tracking the preferences, you can choose the option for all expense accounts.
- Click on the tab “Lists” from the main menu and choose the “Chart of Accounts” option.
- Now select an account for which you would want expense tracking.
- Click on the “Account” button at the list bottom, and choose the option “Edit” from the menu drop-down
- Choose on selecting the box “Tracking reimbursed costs”
- Type the account name you want to use for tracking the income you generate from reimbursable costs.
Tips: After following these steps QuickBooks allows tracking reimbursement expenses for users.
Procedure For Recording Reimbursement in QuickBooks Software
Let’s discuss some steps for understanding how to track reimbursed expenses in Quickbooks.
- As a first step, you have to scroll to the QuickBooks dashboard.
- After completing this, Hit on the +button which is known as “New” on the upper right-hand toolbar while going to the dropdown menu.
- As a third step, you would have to choose the Journal Entry. Now, a Spreadsheet would be visible that you have to fill with Various Line Items to Ensure for filling one Row Per Transaction.
- After that, you must Hit on the Account Column for opening a Dropdown Menu of Accounts connected to QuickBooks and which you conduct the majority of business through. Choose the Bank Account you use for making Payments to Employees for the costs.
- Now, you can Enter the Reimbursement Amount under the Column Credit with Brief, but you must clear the Expense Description in the Column Description. Though it would not be mandatory for filling descriptions, it is also helpful for being organized.
- Post that, from the drop-down menu Select Employee in Name Column. The menu must include Employees with regular Reimbursement.
- Now click on the option Save in the lower right-hand lower Corner. Turn off Journal.
Another Way of Recording Reimbursement in QuickBooks Accounting Software
There is another way of recording reimbursement of QuickBooks coming out of the right bank account:
- For the first step, you must visit Dashboard and click on the Add (+) Sign.
- After that, Hit on the Dropdown menu expenses.
- Now Choose the Bank Account in which you Fund the Reimbursement in the Account Column.
- After it is done, you need to Fill the Description column with the same information that you mentioned in your Journal Entry.
- Also, input the Reimbursement Amount in the Column Amount.
- It is also possible to include other needed information like dates, employee names, etc.
- Save the Expense Transaction to finish the transaction.
Process For Creating Invoice Of The Reimbursement
As the reimbursement amount is entered now you might think of invoicing the same also to your customers. Like in the previous step you already check the option of mailing the invoice to your client.
Now it is vital to learn to activate and use the same. Here are some steps provided which are helpful for understanding the process:
For the first step, you’ll need to Hit on the Invoice Tab in the QuickBooks Accounts Software.
- You get the tab in the option for the customer on the Navigation Bar at the top.
- After that, from the Visible Window, you can also Hit on the Drop Down Button New Customer and Locate the Tab Jobs.
- After that, Click on the option add cost.
- Once it has been done now you need to choose the amount as a reimbursable expense.
- After this, if you don’t have to charge the customer you would have to hit on the option hide.
- After that, you can choose the markup from the tab expenses and also mention the needed information after clicking on the option ok.
- Whatever information you fill you’ll see the same on the invoice.
- Now, you need to Hit on the option Mail the Invoice and you’ll also get the information.
Tips: After that, you would have to mention all the needed information and should confirm and click on the option send and the client will receive the invoice details.
Recording Paid Business Expense With Personal Funds
Although it isn’t suggested to mix personal and business funds, it can sometimes occur. After reimbursing a personal expense, it is possible to record it as an expense or a check. Here is the step-by-step process for how to track reimbursable expenses in quickbooks online:
Step 1: Recording Paid Business Expenses With Personal Funds
While reimbursing personal expenses, it is possible to record the same as an expense or a check. With the following method, you can record reimbursed personal expenses.
- Choose +New.
- Choose the option Journal Entry.
- On the first line, choose an expense account for purchasing.
- Enter the purchase amount in the Debits column.
- On the second line, choose the equity of the Partner or owner’s equity.
- Enter the same purchase amount in the column credits.
- Choose the option save and close.
Step 2: Deciding on how to reimburse the money
- You’ve got two options for reimbursement.
Option 1: Record Reimbursement as a check
- Choose +New.
- Select the option Check.
- Choose a bank account for reimbursing personal funds.
- Now in the column Category, choose the Owner’s equity or the Partner’s equity.
- Enter the reimbursement amount.
- Choose the option Save and new and Save and close.
Option 2: Recording reimbursement as an expense
- Choose +New
- Choose the Expense
- Choose a bank account for using reimbursing personal funds.
- In the column Category, choose the Owner’s equity or Partner’s equity.
- Enter the amount of reimbursement.
- Choose the option Save and close.
Thus after tracking your reimbursed expenses in the right way users can also correct any errors in QuickBooks balance sheet and ensure the right annual balances.
What is the process for recording reimbursement in the check form?
Here are some steps mentioned below that you would have to follow for recording reimbursement as a check:
- For the first step, you would have to scroll to the Button Plus and click on the option check.
- Later, you must select the Bank Account that you used for Reimbursing Personal Funds.
- Now, you would need to choose the owner’s equity or partner’s equity in the column category.
- Further, in the final step, you must enter the amount and select the option save and close.
What is the Process to record the reimbursement like an Expense?
Here are all the steps listed in brief for recording the reimbursement as an expense:
Firstly, scroll to Plus Button and Choose the Journal Entry.
- After this, select the Expense Account for buying on the first line.
- Now you would need to enter the buying amount in the column debits.
- In the next step, you would have to choose the owner’s or partner’s equity on the second line.
- You would have to mention the same buying amount in the credits column and choose the option save and close.
- After doing all the steps, you would need to reimburse the amount.
With the aforementioned steps, you’ll get all the needed information for understanding how to track reimbursed expenses in quickbooks. The software has a tracker tool in its Time and Expenses features usable for keeping tabs on such expenses, usable to keep tabs on the expenses, and assign to expense accounts of each company. However, whenever you still need more information, it is always best to reach out to the professionals for the same.