Currency Gains And Losses in QuickBooks Online

Hi! Kerry here from MyQuickBookKeeping.

Today, I’m going to show you how you canassign a different currency to your suppliers or vendors, and then, to a credit card.

Thenyou can pay those suppliers using that credit card.

Be sure to watch right to the end, becausethen we’ll run the profit and loss or income statement.

We’ll see how those transactionsappear and how currency fluctuations are reflected in your results.

In a previous video, I’ve walked throughthe steps to turn on multicurrency.

If you’ve not yet turned it on you can access that videoand come back when you’re ready.

A really common concern users of QuickBooks have aboutmulticurrency is how to set up the accounts receivable and accounts payable in differentcurrencies.

QuickBooks actually does this for you like magic.

I’ll walk through anexample so you can see the result.

Go to the Expenses tab and select Suppliers.

In the right hand corner, you can set up a new supplier.

So let’s name our companyUSD Supplier.

It’s important now that you select the currency for this supplier.

Afteryou’ve saved it, it will be too late.

So we go here now and choose USD.

Save.

Now, we’re going to purchase something fromour new supplier.

Let’s go here and enter a bill.

We’ll choose our USD supplier righthere.

And the exchange rate to Canadian dollars is displayed.

All of the fields below arenow in US dollars.

Note that the exchange rate is displayed automatically.

We’re goingto put the date for our bill as November 30th.

And when we change the rate, the exchangerate is updated also.

We’re going to purchase some supplies.

Let’sset supplies for $10,000.

We will ignore sales tax for the purpose of this example.

And thisshould enable us to track the exchange rate variants.

The cost down here is displayedin both US and Canadian dollars and that’s calculated using this rate up here.

Save this.

Now, I like to have a credit card or bankaccount in any currency I use often.

So let’s use a US dollar credit card, and if nothingelse, it will come in handy for our cross-border shopping.

Choose Accounting on the left handmargin and then we select New on the top right corner.

The Category Type and Detail Typewill both be credit card.

Let’s name it US dollar credit card.

Now, be sure to selectthe currency before you save.

Okay? Now we have a new account set up.

Now, let’s go up and pay our bill usingthat credit card.

Under paid bills, I don’t save it.

So let’s change the currency toUS dollars.

There we go, our bill appears.

I’m going to pay it with the US dollar creditcard today.

Here it is.

The exchange rate is displayed and the amount of the paymentis shown in both Canadian.

Oh I haven’t selected the bill.

Now the amount of the paymentis displayed in both US and Canadian.

You can make a payment from a Canadian accountif your bank allows it.

Once we’ve done this, we save.

Now I’d like to show you the income statementso you can see the impact that currency movement has had on our transactions.

Have a look downhere.

We have an amount in supplies in Canadian dollars.

Now this is using the rate in effectwhen we purchased the goods on November 30th.

And further down here, we have an exchangedifference.

It’s being calculated as the difference between the rate on the date wepurchased the goods and the date we paid for them.

So if we click through to this account,we can see that it was credited 346.

25 when we paid our US supplier.

Everything is beingcalculated for you.

You don’t need to do anything other than enter the transactionsas they occur.

Let me know if you have any questions.

Ifthis video was helpful, click like below.

Subscribe to my channel.

I’ve created asmall business month-end checklist.

You can download a free copy below and it will helpyou to get your results in order every month and you can properly monitor how your businessis going.

If there’s another topic that you’d like help with, make a comment below,and my next video could be for you.

Cheers!.

Source: Youtube

Currency Gains And Losses in QuickBooks Online

In this video I purchase supplies from a foreign currency vendor, and then pay them from my home currency and watch how the exchange difference results from the shifting currency rates.

Be sure to watch to the end and you will see how this is reflected in our income statement or profit and loss.

Here is the link to my small business month end checklist: http://eepurl.com/cYPbjb

If you have questions or comments, please use the comments box below. I would love to hear from you 🙂

https://myquickbookkeeping.com/


https://youtu.be/wHseY_KHIV8