Our accounting is based on accrual, so expenses are deducted from our gross income when we enter bills, not when we pay them.
I entered a large bill in a previous year for an event that was supposed to be held this year, so that reduced our net income last year.
We ended up cancelling the event due to covid.
So here is my question: How do I zero out that bill so
o. The invoice to no long appears as a bill in Accounts Payable
o. The amount of the invoice to appear as income on this year's P&L
o. For the amount to not to show up as money deposited
I tried creating an new income account called Cancelled Bills, then doing a General Journal entry from Accounts Payable | Name of Vendor to Cancelled Bills. That worked to a degree: The amount now correctly shows up as income in the P&L
On the other hand, the amount also shows up as a negative entry in the A/P Aging report, and the original bill still appears in the Pay Bills window.
What should I do so the invoice no long appears as a bill in Accounts Payable, but still shows up as income on this year's P&L?
Thanks in advance,
Jack
