QuickBooks · Jul 6th 2026 · 7 Min readHow to Make a Journal Entry in QuickBooks Online: A Step-by-Step Guide for Professionals
Your client’s CPA sends over year-end adjusting entries. Or you need to record monthly depreciation on a vehicle that QBO has no bill or invoice for. Or payroll ran through a third-party processor and the bank feed pulled in one lump sum you now need to split across wages, payroll taxes, and employer contributions. In all three cases, a manual journal entry is the right tool—and knowing exactly how to execute one in QuickBooks Online keeps your General Ledger clean instead of knotted.
What a Journal Entry Actually Does
QBO hides double-entry bookkeeping behind friendly forms. When you create an invoice, the software silently debits Accounts Receivable and credits Revenue. You never see it. A journal entry bypasses that abstraction and posts directly to the General Ledger. That makes it powerful and risky in equal measure.
Two rules govern every journal entry, no exceptions:
- Total debits must equal total credits. QBO will not let you save an unbalanced entry.
- Account selection must be deliberate. A single wrong account corrupts your Balance Sheet or Profit & Loss, sometimes in ways that are hard to trace months later.
When to Use a Journal Entry—and When to Step Back
The most common mistake practitioners make is reaching for a journal entry when a native QBO transaction would do the job better.
Skip the journal entry for these:
- Customer invoices or payments — posting a JE to Accounts Receivable breaks aging reports and open-invoice tracking
- Vendor bills or checks — same problem on the AP side
- Inventory quantity adjustments — use QBO’s built-in inventory adjustment tool so cost layers stay intact
Use a journal entry for these:
- Monthly depreciation — debit Depreciation Expense, credit Accumulated Depreciation
- Year-end CPA adjustments — tax preparers routinely send a trial balance adjustment list; JEs are the right vehicle
- Payroll summary entries — when a third-party processor like Gusto or ADP doesn’t sync automatically, a JE records gross wages, employer taxes, and net pay from the processor’s payroll register
- Loan principal/interest splits — if the bank feed posts a single loan payment, a JE reallocates the amounts correctly between the liability and interest expense accounts
- Accruals and deferrals — recording revenue earned but not yet billed, or prepaid expenses to be amortized
For a 10-person CPA firm, nearly every JE posted by staff should be reviewed by a senior. The entry itself takes two minutes; cleaning up a misclassified entry caught at year-end can take two hours.
Step-by-Step: Creating a Journal Entry in QuickBooks Online
Step 1: Open the Journal Entry Form
Log in to QBO. Click the + New button in the top-left sidebar. Under the Other column on the far right, select Journal Entry. The form opens with today’s date pre-filled and a sequential journal number assigned automatically.
Step 2: Set the Date and Journal Number
Change the date to the period the entry belongs to—not necessarily today. If you’re recording December depreciation in January, back-date to December 31. QBO will warn you if the period is closed under a closing date password; you’ll need the password to proceed. The journal number auto-increments, but you can override it to match a source document reference if your firm prefers numbered workpapers.
Step 3: Enter the First Line (Debit)
In the Account column, start typing the account name or number. QBO will suggest matches from your Chart of Accounts. Select the correct account. Enter the dollar amount in the Debits column. Leave Credits blank on this line.
The Description field matters more than most people treat it. Write something a reviewer can understand six months from now: “Dec 2024 straight-line depreciation – 2022 F-150” is useful. “adj” is not.
The Name column (customer, vendor, or employee) is optional but worth populating when the entry relates to a specific entity—it keeps the sub-ledger detail intact.
Step 4: Enter the Offsetting Line (Credit)
On the next line, select the credit account. Enter the same dollar amount in the Credits column. QBO will show a running tally at the bottom: if Debits and Credits match, the difference reads $0.00. That’s what you want before saving.
For entries with more than two lines—say, a payroll summary splitting gross wages across three departments plus employer FICA—keep adding lines until the entry balances. The same zero-difference rule applies.
Step 5: Attach Supporting Documentation
Use the Attachments paperclip at the bottom of the form to upload the source document: the depreciation schedule, the payroll register export, the CPA’s trial balance. Auditors and future-you will both appreciate it. QBO stores the attachment with the transaction permanently.
Step 6: Save the Entry
Click Save and close if you’re done, or Save and new to immediately start another entry. QBO timestamps the save and records which user posted it—useful for firms with multiple staff in the file.
Step 7: Verify in the General Ledger
Go to Reports → Account List, then run a Transaction Detail by Account report filtered to the accounts you just touched. Confirm the amounts and dates posted correctly. For year-end adjusting entries, compare the adjusted trial balance in QBO against the CPA’s schedule line by line before the books are closed.
Reversing Journal Entries: The Feature Most Practitioners Underuse
If you post an accrual—say, accrued wages for the last week of December that won’t be paid until January—QBO lets you create a reversing entry automatically. Before saving, toggle Reverse Journal at the top of the form. QBO will create an equal and opposite entry dated the first day of the next period. That way, when the actual payroll posts in January, it doesn’t double-count the expense. For firms that close monthly, reversing entries are a legitimate time-saver and reduce cleanup work during the next close.
How Sagenext Helps
For CPA firms managing QBO files alongside QuickBooks Desktop, Lacerte, or other desktop tax software, keeping everything on separate local machines creates access and version-control headaches. Sagenext hosts QuickBooks and your other tax and accounting applications on a managed cloud platform, so every staff member reaches the same live file from any device without VPN gymnastics or local install conflicts.
The hosting is fully managed—backups, updates, and security run in the background. You open a remote desktop session and work exactly as you would at the office. For firms where a senior CPA reviews journal entries before posting, multi-user access with individual logins means the review trail is intact without emailing QBO backup files back and forth. Free trial available, no credit card required.
Frequently Asked Questions
Can I edit a journal entry after saving it in QuickBooks Online?
Yes. Find the entry through Accounting → Chart of Accounts, drill into the relevant account register, and click the entry. Edit the amounts, accounts, or description and save again. If your books are closed with a closing date password, you’ll need that password to modify entries in a locked period. Always document why you changed a posted entry—auditors and your own future self will ask.
What happens if my journal entry is out of balance?
QBO will not save it. The Save button stays inactive, and the form displays the difference between total debits and total credits at the bottom. You must resolve the discrepancy before the entry posts. Check for typos, missing lines, or a line entered in the wrong column (debit vs. credit).
Should business owners post their own journal entries, or leave it to the accountant?
For standard, recurring entries like monthly depreciation from a fixed schedule, a trained bookkeeper can handle it. For anything that touches retained earnings, tax-related reclassifications, or prior-period corrections, have a CPA review or post the entry. The downside risk of a misclassified JE that flows into a tax return is significantly higher than the cost of 15 minutes of professional time.
How do I find all journal entries posted in QuickBooks Online?
Run Reports → Journal and filter by transaction type: Journal Entry. You can also go to Accounting → Chart of Accounts, open any account register, and filter by Journal Entry transaction type. For a complete list sorted by date or amount, the Journal report is the faster path.
Does QuickBooks Online support recurring journal entries?
Yes. After entering all lines, click Make recurring at the bottom of the form before saving. Set the template name, recurrence type (scheduled, reminder, or unscheduled), and the interval. QBO will auto-post or prompt you on the schedule you choose. This is particularly useful for monthly depreciation or fixed-fee management-fee allocations that don’t change month to month. QuickBooks Hosting For Smbs
Key Takeaways
- Use journal entries for depreciation, payroll summaries, accruals, and CPA-provided year-end adjustments—not for invoices, bills, or inventory changes that have dedicated QBO workflows.
- Every journal entry must balance: total debits equal total credits, or QBO won’t save it.
- Always populate the Description field with enough detail that someone else can understand the entry without asking you.
- Attach the source document—depreciation schedule, payroll register, CPA workpaper—directly to the entry inside QBO.
- Use reversing entries for accruals to avoid double-counting expense in the following period.
- For multi-staff firms, individual user logins in a hosted environment preserve a clean review trail without passing backup files around. Intuit
