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Level 1

Journal Entry to clear out old entry.

In the early years when we first started this company, we hired a CPA to do year-end taxes. Each year they did some closing entries at the end of the year and over time, these affected Accounts Receivable by over $2000. These amounts show up as 'open' in the monthly report I generate to track what we are owed, so it appears it's overstating our Accounts Receivable. These transactions are now 10+ years old. 

 

Any ideas on how to make an off setting Journal entry that would somehow clear out these numbers?

Thank you!

Solved
Best answer 04-02-2019

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Level 7

Journal Entry to clear out old entry.

This is a big problem when accountants are not familiar with the functions of QuickBooks.  In essence, what the accountant did was recognize income in a different period and/or write up customers that may have had a credit balance.  Either way income was overstated.

 

Short of filing amended tax returns, you need to correct this entry.  I assume these adjustments were recorded in your books using a generic customer.  You need to enter a credit memo in the current year then apply the credit against the journal entries through the receive payment function.

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Highlighted
Level 7

Journal Entry to clear out old entry.

This is a big problem when accountants are not familiar with the functions of QuickBooks.  In essence, what the accountant did was recognize income in a different period and/or write up customers that may have had a credit balance.  Either way income was overstated.

 

Short of filing amended tax returns, you need to correct this entry.  I assume these adjustments were recorded in your books using a generic customer.  You need to enter a credit memo in the current year then apply the credit against the journal entries through the receive payment function.

View solution in original post

Highlighted
Level 1

Journal Entry to clear out old entry.

Thank you so much! I have been looking at this for years and never took the time to ask for help. Your suggestion worked perfectly. 

 

Thanks for taking the time to answer my question.

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