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Status Answered
Created by AgExpert Support
Created on Mar 1, 2014

Disqus Agexpert Accounting Questions Archive

transaction paying with a credit card? Can you do a bank reconciliation? I have always set up my credit card as a bank account.

  • ADMIN RESPONSE
    Feb 10, 2025

    You can reconcile a credit card that is set up as a bank account and you can reconcile a credit card that is set up as a credit card.

    If you still have your credit cards set up as Bank Accounts (which is how they had to be set up pre-2009), then I suggest de-activating those accounts and setting them up as Credit Card accounts (numbering the account such that it appears in the current liability section of the balance sheet). The ideal way to do this (in my way of thinking) is to get the credit card balance on the 'Bank Account' credit card to zero by entering all of the charges from a statement plus the payment of those charges and then start recording your transactions from the next statement to the credit card account that you just set up in the current liability section. Deactivate the 'Bank Account' credit card, so that you are not tempted to revert back to the old habit. I know from experience that old habits die hard, so be kind to yourself and change that old account to 'not active'. To deactivate the account, click View Chart of Accounts on the Dashboard (or click the Blue Book icon on the toolbar or Click Setup/Chart of Accounts from the menu). On the Assets tab, select the credit card, Click Edit (top right corner) and in the bottom left corner of the Edit Account window, remove the check mark from the box beside the word Active. The account will remain in your chart of accounts, but till not appear in menus which list the accounts.

    If you have a situation where your credit card balance never gets to zero, then transfer the balance at the end of a statement period from the credit card in the current asset section to the credit card in the current liability section. You would do this with a Deposit to the old credit card of the amount that equals the balance in your credit card account (the book balance) and choose Type CA Credit Card Advance and the account will be your new credit card account (in the liability section). Complete the reconciliation of the old credit card account before deactivating it.

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