 QuickBooks Online 2022, reversing entry, loan payable, short-term and long-term portions. Get ready because it's go time with QuickBooks Online 2022. Here we are in our Get Great Guitars practice file we set up in the 30-day free trial. Hold it down control, scroll it up a bit to get to the 1-2-5% currently in the home page, otherwise known as the Get Things Done page in the business view as compared to the accounting view. If you want to change to the accounting view it's something you can do by going to the cog up top, switch to the accounting view down below we will be toggling back and forth between the two views either here or by jumping on over to the sample company currently in the accounting view. Back to the Get Great Guitars we're going to open some tabs to put reports in by right clicking the tab up top and duplicating it back to the tab up top right clicking again and duplicating again back to the tab up top right clicking again and duplicating another time. As that is thinking let's see where the reports are located in the accounting view which is right on the left hand side here under the reports. When in the business view however the reports are going to be located we're in the second tab by the way in the business overview here and then we're going to go into the reports there close up the hamburger we're going to open some of the common reports up started with the balance sheet report hold on though it's thinking there it is balance sheet report and then we'll do the range change up top ranges they are changing 0101222 that one actually stayed the same but the endpoint 022822 that one changed 228 being the cutoff date we're going to hit the drop down here and make this in terms of months to see the side by side the Jan the Feb going to the tab to the right then going back into the business overview on the left hand side then the reports this time the profit and loss the P and L the income statement closing up the hamburger range change up top from 010122022 and then we'll change this to months again and run that one Jan Feb tote and then tab to the right we want to go down to the business overview again reports and this time I'm going to close the hamburger we're going to type in up top trial balance trial balance because that's what we're looking up the TB trial balance and then we'll go up top and do the range change from 010122 to 022822 and run it there we have it let's go back to the first tab or second tab to the balance sheet report that is scrolling down to the liability section in the prior presentation we broke out the short term and long term portion of the loans just a quick recap on the loans remember that you can set them up multiple different ways I would recommend or how I typically set them up especially if you're going to have multiple loans which is quite common then possibly having a parent account which will be the loan payable and then simply listing your loan accounts each individual loan separately possibly indicating it by institution but that may not be enough possibly also adding say the last four digits of the loan number so that you can take and tie and the transactions to the amortization tables like this one as you make each of the payments that's something that I think would make it easiest for the internal usage there are other ways you could think about it as well you could for example combine all your loans into one account and so you don't have as many accounts and then try to say that I'm going to take and tie or adjust all my amortization schedules as a type of subledger that would then tie into that to that amount there but I think that's a little bit more work to manage internally personally that I have seen so I like to break out each loans for the internal use you also might say that I'm not going to as the bookkeeper and this could work quite well I'm not going to do anything except basically the cash basis method of it and I'm not going to be breaking out say the interest on it at all so I'm not going to tie into the amortization table I'm just going to record the payments as a decrease to cash decrease to the loan account and then ask my accountant at the end of the period to do an adjusting entry breaking out the interest breaking out the short-term and long-term portion and so on at that point in time that method works okay as well too and that can make it a little bit easier to record the transactions as they come up given the transactions are not standardized because there's three accounts that are affected and you have a difference between the interest and the principal which makes it something that's a little bit more difficult or you can't really memorize the transaction or just pull it in from the bank feed as easily so it'd be nice if you could have a cash basis system when you're doing the data input and then do an adjusting entry possibly at the end of the period end of month or year that is okay so we we're here though we are imagining that we're entering the transactions each each transaction on the bookkeeping side tying out to the amortization table but then at the end of the period I need to break out the short-term and long-term portion which we did with the amortization table we basically just said here's where we're at at this point in time if I look at then the loan principal only not the interest included that would mean that we have 1310854 that is due not including the interest and so the long-term portion is this amount so we then broke that out on our our financial statements with an adjusting entry so now we're at the short-term 1310854 the 5000 is all short term so we left it alone a long-term portion 56769 59 on the long-term portion so now however we don't want to leave it that way from the adjusting department side of things and again this is another area where when you're doing the adjustments you're trying to make the financial statements correct often being done by someone outside of the bookkeeping process and if you just leave it that way then you can upset the bookkeeper because the bookkeeper or the accountant the accounting department it's going to say hey you know I can't easily reconcile between the two what am I supposed to do break out the short-term and long-term portion you know every time I make a payment that makes it a lot more complex you know that doesn't make sense to me so I'd like to do a reversing entry because on the accounting side the system that they're that they're using of course is a good system and then we just need to break it out every once in a while at the end of the period so that's what we're going to do every once in a while systematically at the end of the month or year so we're just going to reverse the entry that was put into place and we can see that in the register so let's go back to the first tab now and let's do this with the register so in other words we could do the reversing entry by hitting the drop down up top and then doing a journal entry but there are only two accounts affected so it might be easier then to go into the register which we can find in the bookkeeping section down below chart of accounts if you were in the accounting view that would be under the accounting down below and then the chart of accounts accounting chart of accounts and so then we're going to close up the hamburger and I'm going to go down I can use either of the accounts because they're both balance sheet accounts so I could use the short term or long term and go into the register I'm going to go to the short term and we're going to be right here and I'm going to go into that register and we'll do the reversing entry just simply reversing the last transaction we made the adjusting entry transaction which is right here so here's the adjusting entry transaction we're just going to do the opposite so this one is now at the balance of the 13108 54 for and we need to make this get to there so we're gonna have to we're gonna have to increase it then wait that's not quite right we need to get this up to here so therefore we're gonna have to we're gonna have to do the adjusting entry or reversing entry by the 56 969 59 which is in essence just reversing this transaction here so we had a decrease before it's going to be an increase this time so we're going to hit the drop down and we're going to do this with a journal entry because we want all of our adjusting entries as journal entries 02 28 uh not 02 this is 03 01 2 2 all of the reversing entries will be as of the first day after the cutoff that being 3 1 in our case memo I'm going to at least put reversing entry possibly more but I'll at least do that which is what I'll do here we're going to have an increase doing the opposite of what we did on the bottom here 56 769.59 then I'm going to see if I can find the account in the in the business view which is somewhat of a challenge sometimes it's going to be loan loan payable loan payable now is this the the short term this is the current there we want we want the long term right there that's the other side not a problem so that looks good so let's go ahead and save it and close it and see if it does do what we want it to so let's go close that out we're going to go to the tab to the right tab to the right let's go up top and refresh it running it again just double check in that we didn't do anything as of the cutoff date 02 28 because we want to keep that where it is of course so I'm going to scroll down and say that is still broken out between the short and the long term let's go back up and change the date then one more period up let's actually make this as of the end of 03 31 22 and run it so we can see the side by side for Jan Feb and March and so we can see the difference the interplay between the two the comparison the side by side as they say so we're going to say down here where am I going I don't just just find the numbers would you here they are here's the numbers so here's where we are we're at the end of February and then we increased it back up to that 69 8 7 8 13 which should tie out to the total on the amortization table meaning it's the short term and long term 69 8 7 8 13 combined together so that when we make the next payment we can record it there according to payment number three and then we can continue to tie out to the amortization schedule without having the short term and long term portion messing us up messing up the whole process if I go down into the long term if we broke it out and then we then we took it back out of the long term so that we only do that periodically and then bring it back into one account so that we don't mess up the accounting department when they're doing what they're doing and they don't want to break out the short term and long term portion with each uh with each transaction because that would be silly because it's more work than it's necessary so we'll do that periodically into the month and or into the year all right so let's go to the let's go to the trial balance and check out the trusty tb see where it's standing at this point if your numbers tie out to these numbers that's great if not try changing the date range let's wait a second we got to bring this up to the end of march let's make it to the end of march 03 31 22 so i'm going to do it as of 03 31 22 just so it includes the reversing entries so this is what we have now this time these are the real numbers as of March 31 we're looking at if your numbers tie out great if not then try to change the range like i did and then sometimes that fixes it and then we'll do a journal report at the end so we can diagnose any differences at that time