QuickBooks Online 2021 #4 Adjusting Entries & Reversing Entries | Robert Steele | Skillshare

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QuickBooks Online 2021 #4 Adjusting Entries & Reversing Entries

teacher avatar Robert Steele

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

21 Lessons (5h 27m)
    • 1. Introduction

      2:17
    • 2. Transfer Data From QuickBooks Desktop Backup File

      13:38
    • 3. 10.05 Adjusting Entries & Reversing Entries Introduction

      18:26
    • 4. 10.07 Adjusting Entry Worksheet Creation

      19:32
    • 5. 10.10 Adjusting Entry Accrued Interest Excel

      13:28
    • 6. 10.12 Adjusting Entry Accrued Interest QB

      10:57
    • 7. 10.13 Reversing Entry Accrued Interest Excel

      15:27
    • 8. 10.14 Reversing Entry Accrued Interest

      18:29
    • 9. 10.25 Adjusting Entry Accounts Receivable Sales Excel

      15:43
    • 10. 10.27 Adjusting Entry Accounts Receivable Sales QB

      22:48
    • 11. 10.30 Reversing Entry Accounts Receivable Sales Excel

      13:56
    • 12. 10.32 Reversing Entry Accounts Receivable Sales QB

      19:14
    • 13. 10.40 Adjusting Entry Prepaid Insurance Excel

      13:54
    • 14. 10.42 Adjusting Entry Prepaid Insurance

      9:25
    • 15. 10.45 Adjusting Entry Depreciation Excel

      26:45
    • 16. 10.47 Adjusting Entry Depreciation

      19:10
    • 17. 10.50 Adjusting Entry Unearned Revenue Customer Deposit Excel

      12:38
    • 18. 10.52 Adjusting Entry Unearned Revenue Customer Deposit

      13:58
    • 19. 10.55 Reversing Entry Unearned Revenue Customer Deposit Excel

      15:44
    • 20. 10.57 Reversing Entry Unearned Revenue Customer Deposit QB

      11:07
    • 21. 10.60 Adjusting Entry & Reversing Entry Journal Reports

      20:27
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About This Class

Project based course focused on entering period end adjusting journal entries into QuickBooks Online.

Adjusting journal entries are generally done at the end of the accounting period, the end of the month, and or, end of the year. Adjusting entries help keep the financial statements on an accrual basis. We will practice entering common adjusting entries into QuickBooks Online.

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Transcripts

1. Introduction: Quickbooks Online 2021, number four, adjusting entries and reversing entries course will be a project based course in which we will be adjusting entries and reversing entries into a practice file within QuickBooks Online the adjusting entries. An entry is typically made at the end of the period, either the end of the month and or end of the year to get our accounting records in accordance with whatever accounting method we are using typically being and the method that we will be using here and accrual method. If we scroll down, we have some resources available to you. Note that if you do not have access to QuickBooks online or if you only have access to a company file, it would like another file to practice with. The it might look into the 30 day trial version often offered by Intuit, often offered for free. There's a link to that here, or you could type into your favorite browser, browser, QuickBooks Online, 30 day free trial and see if you could basically around for that and get more information related to it. Once you have the QuickBooks set up, then you could try to get our beginning numbers into the system. It's a little bit more difficult to get the beginning numbers in there on the online version, but we can try to transfer them from the desktop version. So in other words, we have access for you here to the backup version for the desktop that can be uploaded to the desktop version and in essence converted, which will be the first video of our course here if you would like to go through that process. So in order to do that, you can get access. Typically if you do not have access to the desktop version, you can get asc axis, the free 30 day trial of the desktop version. You can enter the data into the desktop version with the backup file and then convert it to the online version, which will give you good practice in terms of how to do that. And it will give you those beginning numbers if you want to be working along directly with the practice problem, otherwise, you can just practice entering the journal interests without the starting data, without the starting numbers in the system. After we're done with the whole project, we will be generating our reports, the financial statements including balance sheet and the income statement or profit and loss, that will be then your final project. 2. Transfer Data From QuickBooks Desktop Backup File: Quickbooks Online 2021 transfer data from QuickBooks Desktop backup file, so that we have starting numbers in a QuickBooks Online account. Let's get into it within two. It's QuickBooks Online 2020, one, here we are on our desktop. Our objective is to set up a new QuickBooks Online a file, and then take the QuickBooks Desktop backup file that we see here and take the data from it as our beginning numbers in our new QuickBooks Online file. And we would like to do this for free. Our assumption is going to be that you don't have access to the desktop version or the online version. Therefore, we're going to utilize in this process the free 30 day trial for both the desktop version and the online version. So a couple of caveats here. If you do have the latest version of the desktop program, you can kinda skip forward to that point when we go from the desktop version to the online version. However, if you have an older version of the desktop version, you might be thinking that you could skip forward, but you may not want to. You may still want to do the same process to get the free 30 day trial of the latest version of the desktop program and then take your backup file here or create a backup file that you're using this with your own data from your prior version software, restore it to the latest version, QuickBooks, so that you have the latest version which is most likely to convert over as easily as possible when we convert the data to the QuickBooks Online process. So that's going to be the general process. We will then download the 30 day trial of the latest version of QuickBooks Desktop will restore our backup file to that latest version of a desktop version. Then we'll use the kind of process within the desktop version to link to the online version. In our case, setting up hopefully a free 30 day trial for the online version. However, you could just set up a new company file and pay for the online version at that point as well. Also note that we are doing this basically as starting points for practice problems where we would like to have the beginning balance in place. Therefore, if you're doing this for a course, just note that the file name might not be the same, but the process will. So let's go on over to QuickBooks online just so we can see it. This is the Intuit website. Our goal is to set up free 30-day trials, will have to do it for both online and desktop to make this process work. So just to see with a 30 day trial is in the in the Intuit Online at this point in time. It's at I NTU IIT.com, into.com. That's the owner of QuickBooks. I'm going to go into the QuickBooks item or icon. And then we're gonna go all the way down to the bottom where our products are. And then I'm going to go into the QuickBooks Online. So we'll go into then the QuickBooks Online. And you can see down below, they typically have this free 30 day trial. So that's we're still going to try to get access to that free 30 day trial in our practice problem here. But we have to do it as we set up the information from the desktop version and convert it over. So therefore, our first step is not to open the free 30 day trial here, but rather to then open up the desktop free 30 day trial and then, and then take our company file. So we're going to then type into your favorite QuickBooks Desktop free trial. I find that it's easier to actually look in your favorite browser like a Google or something like that then actually on the Intuit website, I'm not sure why that is the case. It typically is that we will be going to an intuit or QuickBooks owned site for the free trial. So we're then gonna say, okay, then typically will have something that download a free trial of QuickBooks Desktop. So remember we're looking for the desktop version here, even though we will then be going into the online version later, because we want to convert the data files. I'm going to go into this item. I'm going to download the latest version of the Desktop pro. So I'm going to go down. It says QuickBooks Pro 2021. That's what I want. It has the license number down here, which you may need to activate the software. So then we're going to click on that item. And then the QuickBooks Pro starting machine runs down here. This is the actual program. I'm in Google Chrome. That's why it's going to pop up down here. If you're in like Firefox, that download item might be up top and so on. Then you're gonna run that. Now I'm not going to go through the running process. It can't take some time. It's a fairly large program, QuickBooks. So just be patient with it. But I won't go through the whole process of running it at that point. At this point, that'll take awhile. Instead, we're going to say at the end of the time period when you run it, you will then have an icon that's going to be QuickBooks Pro. It may not be ProPlus just pro would be fine. 2021. So once again, we want the latest version because that'll make the transfer from the desktop to the online as easy as possible. And if you don't have the latest version and you're doing this for some other purpose than you might want to take your data file, make a backup of it from your data file, then do the process we're doing here with the latest version so that you can have the best chance of your data converting over as good as possible. Then we're gonna open up this file. We're gonna open this up so that we can backup or restore this backup file. And we're going to restore it to this folder. Gets a little bit confusing. We got a couple of things going on here. We've got this is going to be our QuickBooks file. This is our backup file with the data in it kinda like a Word document as compared to Microsoft Word. Once we restore the backup, though, because this is condensed, we will unpack it and create another file, which is going to be the actual writing file, that QB o file, which I'm just going to put in this folder. So let's go ahead and do that. I'm going to go into QuickBooks. Typically, if you have a company file open, you can close the company file by going into the file drop-down and then go and down to close the company file. So I'm gonna go ahead and close our company file. And then you'll typically if this is the first time you've ever opened QuickBooks, you'll be in this intro screen. And this will be the typical kind of intro screen. From here, we can create, we can open or restore a company file down here. I like to do it from the file drop-down, up top. So I go to the file drop-down, open or restore a company file. We're going to restore a company files. So we've gotta go to the second option that I'm going to say Next. And it's going to be a local item. That means it's on our desktop. So I'm going to say next, then I'm going to find it on the desktop. So I'm going to say desktop and there it is, the starting point of the adjusting entries. That's the one we want. So I'm going to say, Okay, and then next, now I got to see where I want to put it. So once I uncompressed this, this is where it's gonna go. You could keep it on the desktop, but I recommend creating a folder because it creates not only one file, but some other kind of files that go with it for some reason or another. So it's nice to have it in a folder so you don't have these other weird things floating around on your desktop. So I'm going to put it in here. You can rename it if you want to name it something different, it down here, of course. And then I'm going to save it. So we're going to save that item. If you're working along with the course and you're using any file that's a great, great guitars file. The password is G, G, G capital G, G, G 1234, capital G, G, G, 1234, capital G, G, G, as in good grade guitar's 1234. Okay. Now the restoration process can take some time, so give it a little bit of time here. Once it's restored, if I go back to the desktop just to see what happened, There's my backup file, nothing happened to it. There's my program, that's good. Now I've got the folder which has stuff in it. Now this is where we put the actual data file. If I go into that data file, then you can see I'm going to make the icons larger. There was nothing in this folder before. This is the actual like q o file, the actual file that we're using. But you can see it made all this other kind of stuff that I'm not sure how necessary it is if you deleted it all, I think the files still works, but that stuff just kinda hangs around if you put it on your desktop. So it's nice to have its own folder so that, that stuff doesn't just kinda literary your desktop. Alright, closing this back out, Let's go back onto QuickBooks. Now, even though we now have the 2021 version, they do update even the latest version from time to time. So even if you just downloaded it, you probably want to make sure that you've got the latest version. So I'm going to go and also note that if this is the first time that you set up QuickBooks itself, you might have to use the registration number and whatnot that was given on the QuickBooks tab over here in order to register the license number and product numbers. So just remember that I'm going to close this back out. Then we'll go to the dropdown and we want to update desktop. So I want to update QuickBooks Desktop. So I make sure I have the latest version in place because again, I want to make it as likely as possible that this will go smoothly as possible. We will update it now and then I'm going to get the updates. If you have substantial updates, then this may result in you needing to restart the program itself or possibly the entire computer. If you don't have substantial updates, then we can just close this out and continue on. Next we go to the company dropped down and then we're gonna go to export your company file to the QuickBooks Online. So company dot drop-down, export your company file to QuickBooks Online. So then we have the option to move to an existing QuickBooks file or to setup a page file. But we want to try 30 day free trial for our practice problems. So I don't want that 30 day free trial. I want to check this one off. It's not quite as boldened over here. One of the problems with the conversion oftentimes will be the inventory, because inventory for the desktop is in weighted average method versus first-in-first-out for the version online. So I'm gonna go ahead and say yes here and then pick up the starting date. Would want to convert it. I'll just pick up today as the starting date when the change will take place. And then I'm going to say save it and continue, Save and Continue. That's one of the areas will, will basically be checking or you want to be careful of if there's some kind of difference with the inventory. And then we could say, Do you have a QuickBooks Online account? If you do, then you say yes, you still may be able to sign in with a 30-day trials considering this as a new company file where at different company file. And if no, then you're going to select know over here it creates a company file. I'm going to go ahead and fit. Fit, yes. Sign me in. We then have the email and password and then I'm going to have the company name for my company name as the get great guitars transfer from desktop company file. And then we're gonna go down here and upload. Depending on the size of your file, upload process can't take some time, so give it a little bit of time. Just note also that this software for QuickBooks to do this upload has been interfering a little bit with my recording software. So if the audio is not quite as good as it has been, then that's kind of one of the issues. But in any case, here we go, we're gonna say good it got it. So got it. After a little bit of time. And again, that does take a little bit of time. They're going to email USA. We've emailed us, we've got an e-mail here saying, congratulations, your data is now available on QuickBooks Online, we think, and go ahead and complete your setup. So I'm going to click on the complete set up, which should be a link. Once that loves you into your account, you may have to finalize a couple more questions here, including, what's your role at your business? We're going to select owner for our rule for our practice purposes here, do you have an account or bookkeeper right now? I'm going to say no, we do it ourselves at this point. And then we're going to say, great, We'll be with you every step of the way. So I'm gonna say, Great, All set. And there's our data set up here. Then you're typically going to want to double-check your data that's going to be on the online to what you have on the desktop version because there could be some issues with the conversion, especially with things like the inventory item that we talked about. So welcome to QuickBooks Online. So I'm going to say, Okay, and you could take that. Let's go tour. I'm just going to close out of it myself. And then once again, you have this on the online version and you wanna kinda check it to what you have in the desktop version. You can then run reports on the left-hand side, the main two reports, those being the balance sheet and the income statement, which are typically going to be up top in the favorite reports. So we're going to say favorite reports. I'll open up the balance sheet type of reports. And then let's run that from here will run from 101 to one to 1231 to one, and say run it. So that's what we have in our data. Thus far, we can go to the income statement. I'm going to duplicate the tab. Right-click. Duplicate the tab up top. We'll talk more about right-clicking and duplicating tabs as we go, but that's a nice feature to have. And then we go down to the reports on the left-hand side and then open up the income statement. The other way you can kinda check that this is with simply running a trial balance type of report in both softwares and checking it. They're running this from 0, 1, 0, 1, 2, one to 1231 to one and run that report. I'm going to close up the hamburger hold down Control. Scroll up just a bit and then it once again, you can run through these numbers, double-check them to what is on the desktop version. And if there's any differences in them, then you can kind of drill down and see what those differences are. Working in the practice problem here, we should be able to mainly push forward with it. Note that again, one of the problem areas that are going to be in the transfer could be with something like the inventory items, those being a separate method from the desktop to the online version. Desktop being weighted average, online version being the first-in, first-out method. But in any case, that's going to be the process. 9. 10.25 Adjusting Entry Accounts Receivable Sales Excel: Quickbooks Online 2021, adjusting entry related to accounts receivable or sales with the help and use of Excel, Let's get into it within two. It's QuickBooks Online 2021. Here we are in our get great guitars practice file. We're going to be opening up a few of our reports balance sheet, income statement, trial balance by going up top right-click on that tab up top, duplicating it a couple more times, doing the same, right-click on the tab up top, duplicate one more time, right-click on the tab and duplicated who we are in the reports on the left-hand side, we're going to open up the trial balance, searching for the good old TB trial balance. My fingers are on the wrong keys. Now they have located the proper ones and we're gonna go to the trial balance. Then range change that up top Indian Point at 02, 28, 21 and run that report. Close up the hamburger up top hold down Control scroll up just a bit. Then we're gonna go to the next tab to the left, down to the reports at the bottom. This is going to be our P&L profit and loss. The income statement opening up the P and L report range change ending at 02 28 to one, running that report, closing up the hamburger. Next report to the left of that going down other reports down below tab. And we're then going to be opening up the favorite balance sheet report that good old balance sheet. It good old balance sheet, ending point 02 28 to one, running that one. And then we're going to close up the hamburger once again with the accounts receivable, we have something that you might think of as like a cutoff type of tests. So the thing about that, let's consider the flow of the accounts receivable in the revenue cycle by first jumping over to the flowchart on the desktop version, you don't need the desktop version to follow along with just looking at the flowchart. Remember that the form that creates the accounts receivable in QuickBooks going to be the invoice. So the invoice over here is in a process typically when we do the work before we receive the payment. So that means that it's going to be increasing the accounts receivable and the other side is going to be recording inventory when we create this form, this is the form that's closest to the point in time that the work was done usually. And therefore, the form that QuickBooks uses to record income on an accrual basis. However, we can think about situations where we might enter this form after we did the work and possibly after the cutoff period. In other words, we can think of situations where I did the work say in the month that we're covering, that being February. And we didn't actually enter the invoice until after that time period. Now that can most easily be thought of if you're thinking like if a job cause type of system, especially for service type companies. So for example, accountants, bookkeepers, CPA firms, law firms, and whatnot. Where you're picking up a job. If you pick up the job and say, Hey, I'm gonna do this, I'm gonna do the tax is I'll do the bookkeeping or whatnot. I'll track how much time it took me to do so. And then we'll bill you based on the work that we did on an hourly rate or something like that. In order to do that, then of course, we're going to have to track our time and then track the time of our employees bill based on the rates that we have applied to them and then create an invoice for it. And that means that we're only going to do that maybe once a week, once every two weeks, once a month. And so that means that when we enter the data, we may have intranet like two weeks after the work was done. So even though the invoices the closest document that we enter into the system that is on an that is closest to when we do the work. It's still may not be when we did the work. And therefore to be on a proper accrual system, we should pull that revenue back into the month in which it was done, rather than taking the inventory that the invoice date. So that's the concept that we're doing now, you can think of a similar thing that would happen in inventory if you had sold inventory, but it's kinda less common that you would have that situation because the inventory, if you sell inventory, then of course, you should be recording the revenue when you give the inventory to the customer. And it's it's theirs, right? And you could have an issue if it's FOB shipping point or destination and whatnot. But the concept is when you did the work, that's when the revenue should be recorded. Not necessarily when this form is created. And so that's kind of what we're looking for in terms of our cut-off date. So if you do audits or something like that, then this cutoff testing is going to be a typical kind of cutoff testing that you will do. And if they have inventory, you'll typically look at the information for the month after and see when the information was shipped out, when they actually shipped it, and then check and see what because that's when the revenue should have been earned and then see when they recorded the revenue. Did they record it prior to the cut-off date or after the cutoff date. If we're thinking about service type of company, like a bookkeeper or law firm or something like that. We would look at invoices possibly that went out after the cutoff in our case March, for which the work might have been done before the cutoff and see whether or not we should be recording the revenue before the cut off, even though the invoice was after it. So to do that, let's go back and just imagine the situation will actually create an invoice in imagine that we're entering the invoice in March for something that happened in February. We're gonna do this with inventory because that's a more complex transaction, although it's a little less common than it would happen with inventory than like a service item. So I'm gonna go back to the first tab. Hold down Control. Scroll down just a little bit. I'm going to open up a new invoice here. And we'll make a new invoice and we're going to make it in March. So we're not going to mess up our current data. We're going to put it in the month after and pretend this happened after our cutoff date. This is going to Anderson. Anderson guitars. Mr. Anderson. And we're going to say this went out on 03, 05 to 1, not 0, 6, 0, 3 to 5, 2 on my keyboard substitutes not used to it. My other keyboard was so much better but it broke. And then this is going to be a GI SUA. Let's see if we have any of those in stock. Still. We do. Okay, so we're going to sell one of those items and we should have the sales tax should be applying out there. So sales tax should be applicable. And there we have it. So that looks good. And when we record this, it's going to, and let's adjust the sales tax with our standard 5% rate. So I'm going to go to the c math down here. And let's do our generic sales tax override. We just want the flat five, flat 5%. And they say, Why? Because other, and then close it and save it. Okay, so there we have it. It's still didn't save it though. Literature out again. It didn't like the way I said. For the reason apparently I'm adding 5 percent. Why? Because other pleased poor for VOR confirm. And there we have 19 percent. That's what we want. Okay. So what's this going to do when we record it? It's an invoice, it's going to be increased in the accounts receivable. The other side's going to be going to the sales accounts receivable going up by the full amount sales going up by the 380, the difference is gonna go to the sales tax of 19%. Then we're also going to have the inventory which is going to go down, which is the added complexity when we deal with inventory as well as the sales tax and the cost of goods sold for the perpetual inventory system. But this will happen in March after the cutoff date, before I want to change the date up top, the invoice date should be 35, not 25, so 35, 21. So it's just in, after the cutoff day, five days after the cutoff. So let's save it and close it. I'm going to save it and close it here. Let's see what happens with it now. So I'm gonna go then to the balance sheet up top. Let's go to the balance sheet. And I'm going to increase the report to the fifth. So that includes the day that we covered. Run the report, hold down Control scroll up just a bit. Accounts receivable will go up. So we're gonna go into the accounts receivable. It's going to go up by the full amount. If we scroll down, we see it going up by the 399, going back up top and back to our report, the other side then go into the profit and loss next report over running that report, once again, as of 35, I'm going to change the dates here from 31, 21 to 35, 21. So I'm just looking at the month of March and the activity in March so I can see this kind of in isolation. So if I go down there, there's the 380, that's the income side that we have not including the sales tax, the difference between those two items then back on the balance sheet is going to be going into a liability account, so it would be included here. And the sales tax liability account. We also know that inventory is going to be decreasing. This inventory accounts going down the other side of it. Then going over here to the cost of goods sold in once again in March. Now what happened is this actually was in March, but we we gave the inventory in February and then record the invoice in March somehow, right. So we need to pull it back into March now, you might say, well, I don't want to just go in there and changed the date of the invoice. You could do that. But again, the invoice might be a link to something else or something and I might mess up the terms and whatnot. So usually you don't want to do that. If you can avoid it, right? And you want to be able to fix it in some other way so you can see the audit trail that is happening, especially if the the form like an invoice is linked up to other things such as the billing and the receivable cycle and whatnot. So what we're gonna do is fix this with a journal entry. Let's do it in Excel first. So if we jump back over to our Excel worksheet, let's just think about the transaction that's going to be affected here. I'm going to scroll up, I'm going to remove or hide columns J, K, and L because I only want to look at the adjusting entries and I don't want these to mess my eyes up in and hide. I'm going to just label the accounts that will be affected. We're going to have accounts receivable. This is the accounts effected for the invoice. All we have to do is just record the transaction related to the invoice. We'll do it in a journal entry type fashion. So just like we labeled off there, we set, we've got the accounts receivable, the inventory are affected, we know the sales tax is affected. I'm going to create another account here though, because I know that when we put this into QuickBooks, it will let me put it into their sales tax thing if we're using the widget kind of process so that I don't want to mess up, once again, the bookkeeper to just do the tracking of the sales tax the way they were doing it. So I'm going to make another accounts so that we can record our adjusting entry related to sales tax right next to it. Then I'm going to go down and say that then we have the invasion, the revenue income, and we also have the cost of goods sold. So those are going to be the accounts that are affected. Now all we have to do is record the normal journal entry. It's just the same journal entry. We're just going to record it before the cutoff now. So this is just the journal entry related to an invoice. And I'm going to make this as we're going to call us and a JE adjusting journal entry 3. And what happens? I'm going to break this out into two journal entries, which is a common practice to be able to see it more clearly, accounts receivable goes up. Then we know that the sales is the other side of the revenue side of the journal entry. And the accounts receivable goes up by the full amount of the invoice. So if I go back on over and we open up the invoice, Let's open up the invoice here again, just going to drill down on it, opened the invoice. And so there we have it. So the full amount was the 399. So we'll say fluorine 99. And then we charged only the three, the 3080. So we charged 380, which is the credit 380, the difference, the negative sum is going to be the sales tax, which is that 19. So there's the 19th difference. So I'm going to pick that up and I'm going to put it into this other account for the sales tax so that when we record it into QuickBooks, I don't get messed up because QuickBooks will probably give me some kind of problem. If I recorded into the sales tax that they are using to automatically generate the sales tax when they record the invoice. This is the sales half and typically people make another journal entry. I won't call it another number here because it's really part of the same transaction. But I'll have it a separate journal entry just so that we can see the basically the expense in inventory side of the transaction. So we typically have cost of goods sold then and then inventory. So this is the bottom half of the transaction. And this side of the transaction is not on the invoice, but the invoices. What drives it once again, of course, by the item. So I can close this out and I can see it. If I scroll back up top and look at my trial balance, it's that 300 four right there. There's the 304. I'm going to record the 3 0 4 and the 3 0, 4 negative. So there we have, there's our two journal entries that just record the same thing. We're just pulling it back in before the cutoff. Now I'm going to record these one at a time. Sometimes I'll, I'll highlight and color the one I'm working on. So I my I will draw to that as I record them. So I'm looking for accounts receivable. So I'm gonna go accounts receivable in the blue column is right there. That equals the 399, some increase in the accounts receivable that I'm looking for, the income account. It's going to be down here. So income is going to be equal to, we're going to be picking up the 3080. So there's the 3080, non-linear. And for the sales tax payable, which is right here, That's going to be equal to the 19. That should put us back in balance. So I've got my green zeros down below, we're back in balance. And then I'm going to record the second half. So what I'll typically do is make this back to blue. So I'll make this our blue. And then we can green a five, this one if we so choose just to draw our eye to it, cost of goods sold is going to be down here in the blue. Cost of goods sold will be equal to that. So there's our change there, and then we have our inventory. And that's going to be going down right there, inventory, decrease in inventory. So, so there we have it now we've recorded the same kind of journal entry, but once again, we pulled it into the current month, right? We've pulled it into the current month before the cutoff. So now we have now we have that information there, There's the impact, here's the impact that we have so far with our two transactions on the income statement down below. So this was our income before we did anything. Here's our adjustments, Here's our income after that point in time. And then we're back to zeros here. Now note, of course, that this will completely throw off the bookkeeper. We're correct now, we're correct here. As of as of our point in time to make the financial statements on basically an accrual basis. But if we don't reverse this one, if we don't tell the bookkeeper better do something about it, then it will be doubled up as of March 5th because we already entered the invoice the month after, so we just pulled it in with a journal entry so we have to reverse it or else we'll have basically, you know, it in there two times. So next time we'll talk more about the reversing entry that we will do as of the day after the cutoff, which will be 31.