-
Verifying the date, amount, and description is essential when reviewing a transaction. Based on previous learnings, Docyt's AI will suggest the most suitable transaction type. However, if you need to change the transaction type, click the corresponding radio button for the desired type.
In this example, since the amount has a minus sign, only transaction types related to expenses, transfers, payroll charges, revenue reversals, equity withdrawals, asset withdrawals, liability payments, and loan payments will be displayed. On the other hand, if the amount is positive, the available transaction type options will include income, transfers, vendor refunds, payroll charges, other income, loan proceeds, equity investments, and other receivables.
2. Some screenshots showcase the various options in the text box when selecting a transaction type for negative amount transactions.
Here are examples of transaction types for negative amount transactions:
- Expense: This refers to any transaction representing a cost or expenditure incurred by a business.
- Transfer: A transfer is a transaction that moves funds between the business's two banking accounts, including credit card accounts. It lets you quickly move money from one account to another within your business's financial system.
- Payroll Charges: This category includes any bank transactions related to payrolls, such as wage payments or payroll taxes, posted under 'Payroll Liability'.
- Revenue Reversal: This transaction type represents a negative dollar amount that reverses previously recorded revenue, typically in cases where a refund is issued to a customer.
- Equity Withdrawal: This transaction type is used when the owner or other individuals withdraw funds from the business's equity. It allows you to track the money taken out of the business.
- Asset Withdrawal: This transaction type is used when the business makes payments for purchasing assets, such as equipment. It can also be used to record a receivable for the business, for example, when a business partner uses a Business Credit Card for a personal expense.
- Liability Payment: This transaction type refers to any payment made to another entity to settle a business liability. It involves transferring funds that were previously received from that entity.
- Loan Payments: This transaction type includes any payment made towards a business loan. Specifying the principal and interest portions of the payment is essential.
3. Below are screenshots that showcase the various options available in the text box when selecting a transaction type for transactions with a positive amount.
Here are some examples of transaction types for positive amount transactions:
- Income (Revenue): These transactions refer to deposits of operational income only.
- Vendor Refunds: This refers to a transaction where the business receives a refund from a vendor.
- Transfer: A transfer is a transaction that moves funds between the business's two banking accounts, including credit card accounts. It lets you quickly transfer money from one account to another within your business's financial system.
- Payroll Charges: These are bank transactions related to payroll that involve making deposits.
- Other Income: This category includes any income not directly related to the business's operations, such as interest earned on money in the business checking account.
- Loan Proceeds: This category refers to funds deposited as a result of a loan received by the business.
- Equity Investment: This category records the owner's or other individuals's investments in the business. It helps track the funds contributed to the business's equity.
- Other Receivables: This category is used to clear out any accounts receivable when money is received into them. It helps keep track of the funds that are received by the business.
4. If the transaction is classified as an expense, you will be presented with a 'Vendor' and 'Category' text box. If there are vendors associated with your business, you will be able to view them. However, if you come across a new vendor, you can easily add them by following the instructions in an article titled "Vendor Maintenance - Creating, Editing, and Reviewing Vendor Profiles in Docyt".
To specify the category, click on 'Select Category', and a new dialogue box will appear at the bottom where you can enter the relevant information in the 'Department' and 'Chart of Accounts' fields. You can click here for detailed instructions and guidance to learn more about creating a split template.
5. Below the category section in the transaction data window, you will find three additional options to customize your transaction handling: 'No document needed', 'Do not learn', and 'Do not push to Ledger'.
5a. No document needed: This option allows you to indicate that no supporting documents are required for a particular transaction. It is beneficial when there is no paperwork or evidence required. For example, if your company's policy states that transactions under $20 do not require receipts, you can check the 'No document needed' box. Another scenario is when you have a recurring payment and only one document, such as a contract or invoice, was provided, like a monthly insurance payment with renewal paperwork indicating the monthly fee for the coverage year. You can mark the transaction as 'No document needed' in such cases.
5b. Do not learn: If you prefer not to let the AI know from a specific transaction's categorization for future automatic verification, you can select 'Do Not Learn'. By choosing this option, the Auto Pilot will not consider any user inputs related to this transaction when making future suggestions. As you review a transaction manually, you can enable the 'Do Not Learn' feature for that specific transaction. This means the AI will not consider any user inputs related to this transaction when making future suggestions. It gives you control over whether the AI should learn from this specific transaction's categorization.
5c. Do not push to Ledger: If you don't want the transactions to be recorded in the QuickBooks Ledger, you can check the 'Do not push to Ledger' box. This feature can be helpful if you have a specific reason for not including the transactions in the ledger. For instance, you can enable the 'Do not push to Ledger' option for payroll transactions if you already have another payroll system that automatically makes these transactions to the ledger.
6. In addition, Docyt provides users with the option to view previous transactions that are similar in type, allowing them to determine the appropriate category for their transaction quickly. Furthermore, users can seamlessly add a document by clicking on the 'Add Document' link.
7. To complete the categorization process, click the 'Categorize Transaction' blue button.
8. Utilize the 'Split Transaction' option in the 'Banking Accounts'-> 'Transactions' section, as shown in the article: "How to Split Bank/ Credit Card Transactions in Docyt to Required Transaction Types" when you need to break down a bank/ credit card transaction into multiple transactions in order to create journal entries for transaction types that affect balance sheet accounts like:
-
-
- Loan Proceeds
- Equity Investment
- Other Receivables
- Equity Withdrawal
- Asset Withdrawal
- Liability Payments
-