Get started with journal entries
A journal entry records a business event directly in the general ledger by assigning balanced debit and credit amounts to accounts. QuickStart can create an individual, recurring, or reversal journal entry, and the entry’s summary shows its balance and net-income impact before submission.
Open Menu > Accounting > Journal. Use Journal entries for individual entries and Recurring journal entries for scheduled templates.
Here are some reasons you might create a journal entry:
- Specify the opening balances for your accounts.
- Transfer amounts from one account to another. For example, you may want to transfer money between asset accounts.
- Record the depreciation of assets.
- Record payroll expenses.
Remember the principles of double-entry bookkeeping when you create journal entries. Journal entries post changes to accounts using offsetting debits and credits. Each posting transaction in QuickStart posts to at least two accounts. Each journal entry includes at least one debit amount and at least one credit amount.
Journal entries consist of the following information:
- Journal entry details: Enter the purpose, transaction date, and posting period.
- Journal entry lines: Enter each line’s account, debit or credit amount, and associated information.
- Attachments: Select or drag and drop any relevant files.
When you have finished entering lines, Out of balance in the Summary box should be 0.00. If it is not 0.00, you cannot save the journal entry.
The Net income impact value in the Summary box displays the change to net income on the income statement report.
The following examples illustrate how net income impact works on journal entries:
| Journal Entry | Account | Amount (Debit) | Amount (Credit) | Net Income Impact |
|---|---|---|---|---|
| 1 | 1100 Accounts receivable (Asset) | $1000 | $1000 | |
| 4100 Service revenues (Revenue) | $1000 |
| Journal Entry | Account | Amount (Debit) | Amount (Credit) | Net Income Impact |
|---|---|---|---|---|
| 2 | 6300 Miscellaneous expense (Expense) | $500 | -$500 | |
| 2100 Accounts payable (Liability) | $500 |
The net income impact could also be $0.00. For example, suppose there is a $1,000 debit to an expense account and a $1,000 credit to an expense account. In that scenario, the net income on the income statement is unaffected.