Quicken & Other Budget/Accounting Software/Clearing A/C
I wanted to create a clearing account, in which module should i create it? i.e expenses/liability/asset etc...
Usually I set up clearing accounts as an asset account.
If I need that account to act as a bank acount, I will set it up as
a bank account.
Here are 2 examples where a bank clearing account is helpful in QuickBooks,
I may want to do cleanup work in the sales tax liability window.
So I will create a bank account called Sales tax Clearing.
I may need a clearing account for Barter transactions where I use a
vendor liability and offset against a customer receivable. Again
a bank account is helpful as I can write a fake check or creat a
fake deposit for the offset amount, eliminating the need for journal entries.
If I dont need a Bank account I will create an Other current
asset account for clearing.
An example would be a payroll clearing account.
And sometimes you need just need a clearing account for miscellaneous
issues. So for that an other current asset is used.
The bottom line is that the clearing account should ALWAYS be zero. So it
really does not matter.
Linda Saltz, CPA
Advanced Certified QuickBooks Advisor
We sell and support QuickBooks Enterprise