How to Make a Journal Entry in QuickBooks Online (2026 Guide)

How to Make a Journal Entry in QuickBooks Online

Journal entries in QuickBooks Online are used to record financial transactions that don’t automatically flow through standard forms like invoices, bills, or expenses. While most day-to-day accounting can be handled through built-in workflows, journal entries are essential for adjustments, corrections, and period-end accounting.

This guide walks through exactly how to create, edit, and delete journal entries in QuickBooks Online, along with practical examples and common mistakes to avoid.

When to Use Journal Entries in QuickBooks

Journal entries should not be your default method for recording transactions. They are typically used in specific scenarios where standard workflows do not apply.

Adjustments

Adjustments are made at the end of an accounting period to reflect accurate financial positions.

Examples:

• Recording depreciation
• Accruing expenses
• Recognizing earned revenue

Corrections

Mistakes happen, and journal entries help fix them.

Examples:

• Wrong account used
• Incorrect transaction amount
• Duplicate entries

Accruals

Accrual accounting requires recognizing income and expenses when they are earned or incurred, not when cash moves.

Examples:

• Recording unpaid expenses
• Recognizing revenue before payment

Step-by-Step Guide

Follow these steps to create a journal entry in QuickBooks Online.

Step 1 – Go to + New

From the QuickBooks dashboard:

• Navigate to the top menu
• Click on the “+ New” button

This opens a menu with all available transaction types.

Step 2 – Select Journal Entry

Under the “Other” column:

• Click on Journal Entry

This opens the journal entry form where you can input transaction details.

Step 3 – Enter Date & Accounts

Fill in the required details:

• Journal Date – The date of the transaction
• Account – Choose the accounts affected
• Description – Optional but recommended

Make sure the correct accounts are selected based on the nature of the transaction.

Step 4 – Add Debit & Credit

Enter the amounts:

• Debit one account
• Credit another account

Ensure that:

• Total debits = Total credits
• The entry is balanced

QuickBooks will not allow saving an unbalanced entry.

Step 5 – Save

Once everything is verified:

• Click Save and Close

Your journal entry is now recorded in the system and reflected in reports.

Example Journal Entry in QuickBooks

Let’s walk through a real example.

Scenario:
A business records monthly rent of ₹10,000 paid via bank.

Entry:

Explanation:

• Rent is an expense → Debit
• Bank balance decreases → Credit

In QuickBooks:

• Select Rent Expense under debit
• Select Bank under credit

How to Edit a Journal Entry

If you need to modify an existing entry:

1. Go to Accounting > Chart of Accounts
2. Locate the relevant account
3. Click View Register
4. Find the journal entry
5. Click and open it
6. Make changes
7. Save again

Editing should be done carefully, especially for entries in closed periods.

How to Delete a Journal Entry

To delete an entry:

1. Open the journal entry
2. Click More at the bottom
3. Select Delete
4. Confirm the action

Deleting entries can impact reports, so always verify before removal.

Common Errors in QuickBooks Entries

Unbalanced Entries

QuickBooks prevents this, but errors can occur if:

• Amounts are entered incorrectly
• Lines are missing

Wrong Accounts

Selecting incorrect accounts leads to misleading reports.

Example:

• Recording expense under assets
• Using revenue account instead of liability

Missing Descriptions

Lack of narration makes it difficult to understand entries later.

Pro Tips for Faster Entry

Use Automation Tools

Manual entries take time and increase the risk of errors. Automation tools can:

• Generate journal entries automatically
• Match transactions
• Sync with accounting software

Import from Excel

Instead of entering entries manually:

• Prepare data in Excel or CSV
• Import into QuickBooks

This is especially useful for bulk entries such as payroll, expenses, or reconciliations.

FAQs

How do I create a journal entry in QuickBooks?

Go to + New → Journal Entry, enter accounts, add debit and credit amounts, and save.

Can I delete a journal entry?

Yes. Open the entry, click More, and select Delete. Ensure it is safe to remove before doing so.

Conclusion

Journal entries in QuickBooks Online are essential for handling adjustments, corrections, and accruals. While the process is straightforward, accuracy is critical.

As transaction volume increases, manual entry becomes inefficient. Using structured templates or automation tools can significantly reduce errors and save time.

What Is Double Entry Accounting?

Double entry accounting is the system that powers all journal entries. Every transaction affects at least two accounts, ensuring that financial records stay balanced.

Definition of Double Entry System

The double entry system records each transaction in two parts:

• A debit in one account
• A credit in another

This ensures that the accounting equation remains intact:

Assets = Liabilities + Equity

Why Double Entry Matters

Accuracy

Every transaction must balance, reducing errors.

Balance

It ensures that financial statements remain consistent and reliable.

Examples of Double Entry

Example 1: Cash Purchase

Example 2: Revenue Earned

What Is an Adjusting Journal Entry?

Adjusting journal entries are made at the end of an accounting period to ensure financial statements reflect the correct values.

Definition of Adjusting Entries

These entries update accounts for:

• Accrued income
• Accrued expenses
• Prepaid expenses
• Depreciation

Types of Adjusting Entries

Accruals

Recording income or expenses before cash is received or paid.

Deferrals

Delaying recognition of transactions until a future period.

Depreciation

Allocating the cost of assets over time.

Examples of Adjusting Entries

Accrued Expense

Depreciation Entry

When to Record Adjusting Entries

Adjusting entries are typically recorded:

• At the end of the accounting period
• Before preparing financial statements
• During closing processes

Common Mistakes

• Ignoring accruals
• Double-counting expenses
• Incorrect depreciation calculations

FAQs

What is double entry in simple words?

It means every transaction has two sides—one debit and one credit.

What is an adjusting journal entry?

It is an entry made at the end of a period to update account balances.

Conclusion

Understanding both journal entries in QuickBooks and the principles of double entry accounting is essential for maintaining accurate financial records.

As businesses scale, handling journal entries manually becomes increasingly complex. Structured processes, templates, and automation tools help maintain consistency while reducing errors.

Sources

1. Intuit QuickBooks Help – https://quickbooks.intuit.com
2. Investopedia – Double Entry Accounting – https://www.investopedia.com/terms/d/double-entry.asp
3. IFRS Foundation – https://www.ifrs.org
4. FASB – https://www.fasb.org