Mike, Thanks for the reply. Digging deeper it appears I have bigger issues as on both Company A and Company B the person coding all of these transactions is debiting interco on both sides... with that being said (as I have much more cleanup to do than I first thought) I want to make sure I am presenting my case correctly and hoping you can relate back to me (aside from the obvious gl coding error) how to correct as I did not 100% understand your answer. While I've been in accounting for several years, my QB experience was quite some time ago. Here is how it is currently being recorded (which I know is not correct): Company A, enter invoice to Company B, shows vendor balance of $1,000 due to Company B $1,000 Due to/from interco ($1,000) A/P Company B, enter "check" to Company A, shows vendor balance of $0.00 due to Company A $1,000 Due to/from interco ($1,000) Cash My thought is to do a JE to debit cash/cr interco on Company A and debit interco/credit cash on Company B and leave vendor out of it completely, as long as the interco is balanced regularly, just not sure this is proper accounting of this type of transaction? Thanks, Liz
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We currently have multiple companys, all of which are corporations. We frequently transfer funds between these companies with the intent of repaying. Currently it appears that on Company A "invoices" are being entered thus setting up AP Liability for the vendor (Company A) that received the funds and that is being coded to due/to from on the vendor account. On Company B there are "checks" written to Company A and coded to opposing due/to from account so nothing shows as due on either the vendor or customer. While I understand neither are considered vendor or customer and technically the intercompany is in balance something just does not seem correct with this treatment. All of this predates me and I just want to get the accounting corrected for the past and on a go-forward basis. Would really appreciate any input. Thanks!
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