Depending on your credit card processing company and on the types of credit
cards you accept, you may want to use different methods to track your credit
card transactions. Below are some options you can choose.
Use Undeposited Funds
Use a Holding account
When to use
If you know the payment and fee processing schedule used by your merchant
If you do not know the payment and fee processing schedule, or do not wish
to manage your credit card sales to this level of detail.
Grouping payments according to how your bank deposits batches.
Activity in your bank account closely matches the actual transactions,
making reconciliation easier.
You can tell at a glance how much money you're receiving from merchant
account transactions on a regular basis.
Allows you to keep merchant account deposits separate from your bank account
until you are ready to deposit them, making reconciliation easier.
You can still reconcile your merchant account activity, even if you do not
know or cannot easily predict your payment and fee processing schedule.
Allows you to manage your merchant account when you receive your statements
instead of on a scheduled basis.
Set the "Use Undeposited Funds as a default deposit to
Open the sales and customers preferences.
In the Receive Payments section, check the "Use Undeposited Funds as a
default deposit to account" preference.
Create payment items to
represent the different payment methods for your sales.
For example, "Amex", "Discover", and
"VISA/Mastercard". Use undeposited funds as the deposit to
Enter daily sales summaries.
Record a separate "Make Deposit" for each payment method.
In the Payments to Deposit screen, select all the payments that are batched
together by your merchant account provider for the day.
If you know your merchant discount fees and the fees are subtracted from the
amount that your merchant service deposits to your bank account, you can deduct
those fees here by adding a line to your deposit in the Make
Select the Received From column, just below the last payment.
Enter the charge card company (such as the QuickBooks Merchant Account
Service), which has been set up as an Other Name.
Click the Account drop-down list and choose your merchant account fees
Enter the fee amount as a negative number.
This will decrease your deposit to reflect the net deposit amount.
Save the deposit.
Create an account of
type "Other Current Asset" for holding credit card transactions until
you are ready to transfer the funds into your bank account.
If you receive merchant account deposits from several different vendors you
may wish to create one account for each.
For example, "AMEX", "Discover", and
"VISA/Mastercard". Use the appropriate holding account for the
deposit to account.
Enter daily sales summaries
Transfer the amount of each deposit from your holding
account into your bank account.
When you are ready to deposit the funds into your bank account, select Make
Deposits from the Banking menu.
If the Payments to Deposit screen appears, click Cancel.
In the Make Deposits screen, enter your bank account in the Deposit
Enter the date of the deposit in the Date field.
Enter a descriptive memo in the memo field (for example, "AMEX
On the first line of the deposit, enter your holding account in the
"From Account" column and enter the amount you wish to transfer
from the holding account into your bank account.
Enter the charge card company (such as the QuickBooks Merchant Service),
which has been set up as an Other Name.
Continue entering all your deposits in the same way until all deposits in
your bank account match with your bank statement.
Note: You can also manually enter your merchant discount fees as a
payment (check) from the holding account and transfer only the net (payments
less discount fees) into your bank account.