Debits and Credits for Landlords in QuickBooks

When you’re a busy landlord using QuickBooks, you may just want to use QuickBooks and not have to think about journal entries, debits, or credits. And, generally the way we teach things, you can do that. However, sometimes it is very useful to think about transactions as Debits and Credits.

“Accounts” are just a collection of transactions that sum up to give a current balance. There are always two kinds of transactions that come into play: a debit or a credit. In the image above, you can see the shorthand notation used, a “T-account.” where debits are on the left and credits on the right.

It depends on the account type if a debit increases or decreases the balance

This is just the way accounting works. A cash account is an assets, and they increase with a debit; but liability accounts increase with a credit.

cash and liability T-Account quickbooks

The example transaction below shows the two accounts involved in creating a loan. It increases your cash, and increases your liabilities.

cash and liability T-Account example deposit a loan

In any given transaction the sum of all debits must equal the sum of all credits. Here 500 equals 500, perfect.

In QuickBooks for Mac, the Journal Entry would look like this:
mac journal entry

Or for Windows, it would look like this:general journal short term loan windows

The equivalent could also be a deposit like this. It is not a Journal Entry directly, but it creates one behind the scenes.
quickbooks make deposit mac

You can verify the deposit creates the equivalent Journal Entry by opening up the Petty Cash register and highlighting the transaction. Then click Reports > Transaction Journal. In the mac version the following opens up. It’s equivalent for windows or online.
transaction journal

Use this chart to help you remember if a Debit or Credit increases each account type’s balance.

Extracted from page 23 of our training guide, the below graphic is a quick reference when you need to make a Journal Entry. Consult it to review which account increases by a credit and which by a debit.

debits and credits T-Accounts quick reference

Read more about this is our free debits and credits excerpt from the eBook.

Leave a comment with more details of what you want to learn about, or order our full training today.

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2 thoughts on “Debits and Credits for Landlords in QuickBooks

  1. Pingback: What is an Account? (eBook excerpt chapter 2.03) | Property Management in QuickBooks

  2. Pingback: Q&A: Why are debit cards called debit cards? | Property Management in QuickBooks

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