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Adding and finding journal entries

At the end of the financial year, your accountant might want you to record journal entries for things such as depreciation of your computer or company car. As these are likely to be just “book adjustments” (there’s no cash or other party involved), you would record them as general journal entries.

Need to change, delete or reverse a journal entry? See Changing or deleting a transaction.

General journal entries are different to other transactions in AccountRight. In the Record Journal Entry window (Accounts command centre > Record Journal Entry) you need to:

  • specify at least two accounts that require adjusting (this is called the "double entry" system of accounting)

  • enter at least one of the amounts as a “debit” and another as a “credit”

  • ensure that the total debit and credit amounts in the entry are equal.

Your accountant can help you work all this out, but if you need a quick refresher, here’s a guide to choosing whether an amount is entered as a debit or credit in the Record Journal Entry window:

For accounts of this type...

Record an increase as a...

Record a decrease as a...

1-xxxx Asset

Debit

Credit

2-xxxx Liability

Credit

Debit

3-xxxx Equity

Credit

Debit

4-xxxx Income

Credit

Debit

5-xxxx Cost of Sales

Debit

Credit

6-xxxx Expense

Debit

Credit

For example, say you want to record depreciation expenses for your company car. The two accounts that are affected are:

Account

Account type

Increase or decrease?

Debit or credit?

6-1140 Depreciation

Expense

Increase

Debit

1-2320 MV - Accum Dep’n

Asset (but it has a negative balance)

Decrease (because it has a negative balance)

Credit

Other ways to record adjustments

If you need to adjust the balance of banking accounts, inventory items, customers or suppliers, there’s a better way to record the adjustments. Here are some common adjustments you might need to make and suggestions for how to record them in AccountRight:

Bad debts

Record an adjustment for each customer using the Sales window (Sales command centre > Enter Sales). Enter negative dollar values in the sales to create credit notes that can be used to close the sales you won’t be receiving payment for. Tell me more

Stock adjustments

If you’re tracking item quantities and values in AccountRight, go to the Inventory command centre > Inventory Adjustment to make any adjustments. Tell me more. If you’re not tracking inventory, you can record a general journal entry.

Opening balances

Go to the Setup menu > Opening Balances to enter amounts for accounts and items you had on hand when first starting to use AccountRight. Tell me more

Bank transfers

To record transfers between banking accounts or to petty cash, go to the Banking command centre > Transfer MoneyTell me more

Owner drawings

To record withdrawals, or personal expenses, go to the Banking command centre > Spend MoneyTell me more

Capital contributions

For cash contributions made by the owners of the business, go to the Banking command centre > Receive MoneyTell me more. For other types of assets, such as a car or furniture, record a general journal entry.

To record a general journal entry

  1. Open the Record Journal Entry window (Accounts command centre > Record Journal Entry).

  2. Enter the date of the entry. Most end-of-financial-year adjustments are recorded as at 30 June for Australia, or 31 March for New Zealand.

    Journals for last financial year

    If you've closed your financial year but need to record a journal entry for that year, you can roll back the financial year to record that transaction. Once you've recorded the transaction, make sure you close the financial year again.

  3. Enter a Memo describing the journal entry, for example “Depreciation for the 201x financial year".

  4. Select if the entry is Tax Inclusive.

  5. The General Journal No. field shows the next available number for your journal entries. If you click this field, Auto # appears to confirm that the number has been automatically selected for you. You can type a different number into the field if you want, but this will not change the numbering for subsequent general journals.

  6. Select if the entry is a Year-End Adjustment. Learn more about entering end-of-year adjustments.

    Selecting this option means you’ll be able to filter it out of reports such as your Profit & Loss Statement when you display the report (to do this, select Exclude Year-End Adjustments from the Display Transactions filter when viewing the report). 

  7. In the Acct No. field, select one of the accounts you want to adjust.

  8. Enter the amount you want to adjust in the appropriate column— Debit or Credit (see the table above as a reference).

  9. If the entry relates to a job, enter the job number.

  10. If you want to record a comment about the account you’ve selected, enter it in the Memo column.

  11. If the entry affects your BAS (GST) return, select the appropriate tax GST code. Otherwise, leave the Tax (GST) column blank, or select the N-T Not Reportable code.

  12. On the next row, select another account that you want to adjust and then complete the relevant details for each column.
    If the entry involves more than two accounts, continue to add rows for each account. Press the TAB key on your keyboard to move to a new row.

  13. If you selected codes in the Tax (GST) column other than N-T, select whether the adjustment relates to sales or purchases:

    display in reports AU

  14. Click Record.

Here's an example journal entry:

Need to change, delete or reverse a journal entry? See Changing or deleting a transaction.

FAQs

Can I record a journal entry to fix a transaction recorded using the wrong account or tax/GST code?
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The easiest way to fix the transaction is to reverse or delete it, then record it again using the correct details.

Alternatively, you can record a journal entry to fix it. Because each transaction is different, exact steps are hard to provide. You might need the help of an accounting advisor to help work out the particulars of your journal entry.

Here's a typical example for correcting a transaction posted to the wrong account:

  1. On the first line of the journal entry, debit the account used in the original transaction and apply the original tax/GST code.

  2. On the second line, credit the correct account and apply the original tax/GST code.

  3. Ensure the amounts on each line are the same so the transaction balances.

Here's a typical example for correcting a transaction posted with the wrong tax/GST code:

  1. On the first line of the journal entry, debit the account used in the original transaction and apply the original tax/GST code.

  2. On the second line, credit the original account and apply the correct tax/GST code.

  3. Ensure the amounts on each line are the same so the transaction balances.

Can I set up a recurring general journal template?
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Yes! This means you won't need to create a general journal entry from scratch each time you need to record it. When you set up a recurring transaction, the transaction information is saved in a separate "holding area" where you can retrieve the transaction as many times as you want. You can change the information on a recurring template as needed. Until you record them, recurring general journal templates have no effect on your financial records.

You can remove a recurring template whether your transactions are changeable or unchangeable. The transaction is removed from your list of recurring templates only. Any transactions you've already recorded using a recurring template won't be affected if you choose to remove that recurring template.

Tell me more.



How can I print my journal entries?
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While you can't print individual journal entries, you can run the General Journal report for a given date range, then print the report. The General Journal report is found under Reports menu > Index to Reports > Accounts tab > Transaction Journals sub-heading.

Note that this report will always sort journals by date (oldest journals first), regardless of any other Sort criteria you apply.

What does Auto # mean in the General Journal No. field?
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The default number shown in the General Journal No. field is the next available number. When you click in the General Journal No. field, Auto # appears to confirm that the number has been automatically selected for you. You can type a different number into the field if you want, but this will not change the numbering for subsequent general journals.