Skip to main content
P
PreciousMM
October 12, 2024
Question

Reconciling Paypal

  • October 12, 2024
  • 1 reply
  • 0 views

To use paypal and connect it in your QB i know that you must make a deposit into it then you transfer to other accounts or pay people , make your transactions etc, however I have a scenario where a client of mine just made purchases or transfered using a card but using the paypal mode. If i try to categorize these in any way- it creates double entries. (Money was not deposited into paypal first by the way so paypal just shows the transfers and purchases done but it shows a negative balance on the balance sheet) My question now is how can i fix this.

1 reply

F
FateCandylaneT
October 12, 2024

Managing negative balances in your account is crucial to ensure discrepancies in your transactions are resolved, PreciousMM. Let me help you fix this.

 

If payments made with a credit card is linked to PayPal, this may not always be deposited directly into PayPal, which can lead to a negative balance if not recorded correctly.

 

To resolve a negative PayPal balance caused by payments made directly from a card, it's important to examine your financial records to ensure these transactions are accurately represented. You may consider following these inputs:

 

  • Check Transactions: Review all transaction records in QuickBooks Online for payments processed via PayPal intended for credit card accounts. Confirm that these payments aren't mistakenly listed as PayPal withdrawals.
  •  Adjust the Accounting Records: Identify any transactions logged as PayPal payments and modify them to reflect the credit card payment. 

 

You can also create a journal entry to credit the affected accounts, helping to keep your books accurate and balanced.

 

Before proceeding, I recommend consulting with your accounting expert. They can review your records and advise you on the best way to record the transfer based on your business needs. If you don't have an accountant, you can locate one in our Resource Center. Here's how to create a journal entry:

 

  1. Click on the + New icon.
  2. Choose Journal entry.
  3. Fill in the required fields to create your journal entry.
  4. Click on either Save and new or Save and close.

 

In addition to that, if the bank reconciliation reflects a negative value that aligns with the negative balance for PayPal on the balance sheet, it’s important to review the opening balance before entering any transactions in QuickBooks Online. 

 

For a step-by-step guide on this process, consult this helpful resource: Fix issues the first time you reconcile an account in QuickBooks Online.

 

Moreover, I've included these references in case you need them in managing your entries:

 

 

I'll keep an eye on this thread for any additional queries when managing discrepancies in your transactions. Just let me know in the comments below. Have a good one!

Terms & ConditionsAccessibility statement