How to eliminate bank account balance due to time difference of foreign exchange rate?

yunke8849-gmail- · ‎July 12, 2024

My book is recorded in Mexican Peso, and we have an old CNY bank account. We transferred out all money from that account. From chart of accounts, it shows a nil balance in CNY, however it is not nil on balance sheet due to foreign exchange rate. Does anyone know how to close the balance to foreign exchange gain&loss, so we can get both nil balance on chart of accounts and balance sheet?

JanbonN

I'm here to help you balance your Chart of Accounts (COA) and Balance Sheet, Yunke8849.

We'll have to create a holding account for the discrepancy caused by the fluctuating exchange rates and create a Journal entry (JE) to move the balance to the holding account.

Here's how to create a holding account:

Go to the Gear icon and select Chart of Accounts.
Click New.
Select Bank as the Account Type.
Choose a name for the account you can easily remember, and fill in the necessary information.
Click Save and Close.

As for creating a Journal entry to move the balances, I would recommend consulting with your accountant about this process for further assistance.

Additionally, you can refer to this article about personalising your reports: Customise reports in QuickBooks Online.

Let us know if you have other concerns with your COA or balance sheet. We're here to help you in any way we can.

yunke8849-gmail-

I have created a foreign exchange gain&loss account, when I move the balance to this account, it shows an nil balance on balance sheet, however, the balance in chart of accounts shows an negative amount. Would that be possible to have both nil amount on balance sheet and chart of account?

SarahannC

Thanks for responding, yunke. Yes. It is possible to have a Nil amount on both the Balance Sheet report and the Chart of Accounts. I recommend you consider consulting your accountant for proper recording using a journal entry and the appropriate account.

Additionally, you can check this article for tips about customizing reports in QBO: Get the most out of your financial reports.

You can always visit this thread if you've other concerns. I'll be around to help.

yunke8849-gmail-

My accountant has created an foreign exchange bank account and foreign exchange gain&loss account, however, even she reallocated the balance on trial balance to foreign exchange, but it made the balance in CNY negative which means we can not adjust to both nil amount. Could you advise more detail about how to adjust it?