Most businesses use credit cards or debit cards to purchase products or services, but that doesn’t necessarily mean cash is obsolete. Some entrepreneurs and business owners still use cash to cover their expenses. It’s accepted by all or most vendors, making it a convenient form of payment. Unlike credit cards and debit cards, however, cash purchases don’t leave a paper trail. Therefore, keeping track of them can be difficult. As a business owner, you should record cash expenses in your Quickbooks account by following the steps listed below.
To record a cash expense in Quickbooks, fire up your accounting software and click the (+) sign at the top of the page, followed by “Expense” under the “Suppliers” menu. From here, you’ll be able to choose the vendor to whom the payment was made. Simply click the drop-down menu for “Payee” and scroll through the list until you find the appropriate vendor, after which you can click it the vendor’s name. You’ll also need to choose an account for the expense, such as a cash account.
After choosing the payee and the account type, enter the date on which you made the cash payment. If you can’t remember, go back and look at your receipts. It’s important that you enter the correct date for tax purposes, as erroneous payment dates may flag an audit. And if you can’t find a receipt, consider calling or contacting the vendor to see if they have a record of the transaction. With a little investigative work, you should be able to identify the date on which you made the cash payment.
There are still a few other steps left to record a cash expense. For example, you’ll need to select “Cash” in Quickbooks as the payment method. You’ll also need to select an expense category in the Account drop-down menu. Furthermore, Quickbooks requires users to enter a description and dollar amount for the purchase. And finally, if you paid sales tax on the cash purchase, you’ll need to enter in the “Sales tax” field. Once you’ve completed these steps, you can click “Save” to complete the process.
Recording cash expenses in Quickbooks isn’t much different than recording credit card or debit card expenses. The only real difference is that you’ll need to choose “cash” as the payment method. Refer to the steps listed here if you can’t remember how to record cash expenses in Quickbooks.
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