Creating Journal Entries

There are times when general journal entries may need to be made. A journal entry window is available in most modules. For example, if you wish to enter a sales journal use the Journal Entry window with in the Sales menu. Some possible reasons for creating a journal are listed below.

An expense or income transaction may have been posted to the wrong account and rather than going back and changing the invoice it is easier to make a general journal entry.
To enter any Ending Adjustment "Month 13" transactions.
When adjustments are necessary to make loan balances equal the correct ending balance.
To adjust any payroll tax amounts or employee balances.
When inventory history totals do not match the detailed inventory amounts.
To adjust accounts receivable or accounts payable balances including adjustments to the customer or vendor’s history totals.
To enter beginning balances when starting to use the system.
To distribute Retained Earnings totals to different equity accounts.
To enter year-end adjustments needed to correct any balance sheet account.

This list is not complete since the journal can be used to create any transaction. Each module contains it’s own journal window which will post to different transaction files.

The General Ledger Journal’s transactions are posted directly into general ledger and history files. No additional posting step is needed.
The Expenses, Sales, Inventory, and Payroll (as well as any other module) journals will be posted into the corresponding module’s unposted transaction file. For example, the Expense Journal will be posted in the Expense Unposted Transaction file.

Creating a General Journal Entry

To make a general journal entry, take the following steps:

Go to General Ledger > Journal Entry and the following window will appear:

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Enter a Journal ID. A Journal ID can be a date, word, initials, or anything that helps identify the journal. A recommended journal id format is to use YYYYMMDD (using the journal date). The date journal id can be suffixed or prefixed with a sort code such as YE for Year End, ADJ for an adjustment journal, or BB for a Beginning Balance journal. For example, a month end adjustment for the month of October could be coded as 19981031ADJ.
Enter the transaction Date, which will determine the month and year in which the transaction will be posted. To post Ending Adjustment "Month 13" transactions select Ending Adjustment Year and set the appropriate year.
Enter the G/L account to be debited. Use the drill down button to view all accounts if unsure of the account number. A journal line may contain only a Credit Account with the Debit Account blank or vise versa. A Debit G/L account must be entered if the Credit amount contains a value.
Enter the Debit Amount.
Enter the GL account to be credited. Use the drill down button to view all accounts if unsure of the account number. A Credit G/L account must be entered if the Debit amount contains a value.
Enter the Credit amount.
Enter a Description of the journal entry. Note that this description will be the primary explanation of this transaction to an accountant or auditor at a later date.
The ID, Reference 2, Track 1, and Track 2 are advanced fields that affect a variety of historical data within the system and should be used with caution.

Listed below are some of the more common uses for these fields. The G/L Class column is to identify the class of general ledger account required for this adjustment. It is very important that the general ledger account is set with the proper classification. Go to General Ledger > Chart of Accounts – Advanced tab to view a general ledger account’s classification. The account must also be listed in the proper debit or credit column as described in the Debit/Credit column. Negative credits or debits must be used at times to decrease history. Multiple adjustments within the same date period may be listed on the same journal. N/A indicates that the column is not applicable and can be left blank.

Debit/Credit

GL Classification

Reference2

Track1

Track2

Adjusting Vendor Invoice History
Credit	Accounts Payable	Vendor ID	N/A	N/A	N/A
Adjusting Vendor’s Down Payment History
Debit	Prepaid Expense	Vendor ID	Check No.	N/A	Bank G/L Account
Adjusting Vendor Payment History
Debit	Accounts Payable	Vendor ID	N/A	N/A	N/A
Sales Tax Adjustments
Credit	Sales Tax	Customer ID*	Sales Tax ID	Taxable Gross	Total Gross
	* The ID entry is optional since the customer history contains no sales tax history. List the customer if the adjustment is a result of an invoice involving a specific customer; otherwise ignore the ID column.
Adjusting Customer Invoice History
Debit	Accounts Receivable	Customer ID	N/A	N/A	N/A
Adjusting Customer Down Payment History
Credit	Deferred Income	Customer ID	Check No.	N/A	Cash G/L Account
Adjusting Customer Payment History
Credit	Accounts Receivable	Customer ID	N/A	N/A	N/A
Adjusting Inventory Purchase Totals (Increase)
Debit	Inventory	Vendor ID*	Inventory ID	Count	N/A Adjustment
	* Optional: List the vendor’s ID if the adjustment is a result of an invoice involving a specific vendor; otherwise ignore the ID column.