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Accounting & Bookkeeping & Small Business Forum
Accounting, Bookkeeping, Marketing, and Small Business Resource
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EvieS
Joined: 20 Jun 2006
Posts: 1
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| Posted: Fri Jun 30, 2006 8:31 am Post subject: Reversing Cleared Checks |
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By error, current checks were cleared along with older outstanding checks. A journal entry was used to complete this transaction. My question is "How can I reverse ( or unclear) these checks properly without effecting any accounts, since these checks will, for sure, be showing up on the next bank statement"?
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Debbie Cardoza
Joined: 17 Jan 2006
Posts: 18
Location: Foxboro, MA
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| Posted: Tue Jul 18, 2006 12:02 pm Post subject: Reverse cleared checks |
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| Set up a dummy account to wash the checks through. DR the expense and Cr the dummy account. Then clear checks through the dummy account. |
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Monica
Joined: 17 Aug 2005
Posts: 188
Location: Texas
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| Posted: Tue Jul 18, 2006 11:23 pm Post subject: Reversing cleared checks |
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Hello Evie,
If you void the previous payments (journal entries), assuming you are working in QB, and apply the correct check numbers to the older accounts for which you have just now received payment, that should solve your problem. That would leave you with a trail, but it could be a pain down the road if you didn't make good notes.
I need some more information...but on the tax return you should show the payments on the older accounts as income. If your client made a profit the year before, or if he paid in some money--and these payments were included in his gross profits, then an amended return would be in order.
As far as dummy accounts???....don't do that.
Monica |
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