 So our cutoff date is 228, and then we're gonna reverse it as of March. Let's see that on the income statement too. Let's put this out to 03, 31, 2, 3, run it. So this is most easily seen here on the income statement. The actual invoice was entered in March, but the work was actually done in February. Therefore, we did an adjusting entry to record this 500 and 400 included in the line item in February. So that makes the financial statements correct in February, but now if I don't do anything to fix it, I'll have entered it twice in by the time March is in place and it's March 5th is when the transaction took place. So now I have to do a reversing entry. Now remember, you might say, well, why don't I just, why don't I just go into the invoice that was entered in the wrong date, we're saying, and change the date? And the problem is that it's not exactly wrong possibly with regards to the system that the accounting system is using, maybe they do their invoicing every two weeks for the work that was done in the prior period or something like that. Their system is right for their accounting system. It's just not exactly right on an accrual basis, which is what is requiring the adjusting entry. I don't wanna mess up their system. I just wanna make it correct as of the cutoff date, so I can make the financial statement reports correct and then do the reversing entry so they can do whatever they need to do. So last time we did this adjusting entry, so if I can see it, if I drill down in here and I look at this journal entry, this is the adjusting entry we did. It's quite complex of an adjusting entry because invoices with inventory and sales tax can be quite complex. What I need to do now is reverse it so that it's not entered twice and the reversing entries happened the first day of the following period. In our case, cutoff 228, the first day and the next period, March 1st. Now to do the reversing, the easiest thing to do is to just copy, maybe take a screenshot of this and then reverse it exactly. You might take a screenshot and say, okay, that's what we did here. I'm just gonna put that down here somewhere and then I'll reverse that exactly. Let's just think about the process of the reversing with our journal entry up top. Cause a lot of times people get a little bit messed up with these debits and credits. We're gonna have to use, in essence, journal entries because it's kind of a complex transaction. We can't just use ledgers. There's not just two accounts affected. And when people use journal entries, they start to think, well, I need to put the debits on top and the credits on the bottom and then that kind of messes up the ability to just do the opposite that you did before. So I wouldn't think about that. I'm not gonna go, I'm gonna put the debits on top or anything, I'm just gonna do the exact same thing and reverse it. Also note, people often try to think about a reversing entry. This is an entry similar to a credit memo by basically just trying to imagine what happens in the credit memo or in the reversing entry instead of the easier way, thinking about what the normal journal entry is when we enter the invoice. This is the transaction mirroring an invoice with the adjusting entry and then just doing the opposite, doing the opposite from top to bottom instead of trying to reshuffle the accounts. So here's the transaction we did last time. I'm just gonna reverse it. I'm just gonna put the AR on top and I'm gonna credit it. So usually we'd have the debits on top but that's confusing. I'm gonna put the credit on top because that's the easiest way to imagine what's going on and then I'm just gonna reverse. Here's the debit to the sales and then I'm gonna reverse the sales tax. This is going to be a debit to the sales tax and then the cost of goods sold. We're gonna have a debit to the cost of goods sold and then the inventory. We're gonna have a credit to the inventory. So we're just doing the exact opposite. I just messed these two up. Hold on a second. Okay, hold on. This needs to be over here. See, even when I just copy it, it's messy. So is that right? Yes. So now we just basically did the same accounts top to bottom. I think that's the easiest way to visualize it. Reverse the debits and credits which might be difficult to do in your head because you always wanna put the debits on top because that's what you've been trained to do. Resist the urge if it's easier to have an audit trail by not doing that. If it makes it more simple to go back and see what you did or figure out how to do it, then let that rule go because it doesn't serve you any purpose. It just complicates things. And if you have a picky supervisor or something, first do this and then put the debits on top after you've figured out what you need to do. So that's what we need to do. Remember that the accounts receivable is one of the issues. So because we can't record to AR without having a customer. So we, instead of using the customer we actually made the sale to, we made another customer called ZZZ so that all the detail related to them and the sub ledger and the detail in the customer center will hopefully not distract the accounting department. And then the other one is the inventory which we saw was actually gonna be out of balance because we were allowed to record $400 to it without an inventory item. So it's out of whack. It's out of balance by 400. We're gonna put it back in balance. And that's kind of good that it let us do that in this case even though it's a little risky because you could, if you're not careful throw the ledger or the sub ledger out of balance. But here it's good because now we don't have to post something to the sub ledger and mess that up to do our adjusting entry. So that is gonna be that. Also note that this should look unnatural with regards to the sales and the cost of goods sold because sales doesn't normally go down. Sales doesn't decrease. So it's gonna look funny when we record it and it should look funny in terms of debits and credits but it'll make sense because when we match it out to the actual invoice it will nullify the invoice that was entered in February. So what we did, the actual invoice was entered in March, I'm sorry, it was entered in March. We pulled the invoice into February with a journal entry but we didn't delete the transaction entered in March. So now the financial statements are correct as of the cutoff date February 28th but it's gonna be entered twice once in February, once in March. So instead of deleting the item in March we're gonna nullify what happened in March by reversing the transaction which will net out against the transaction entered in March so that it'll nullify the transaction. So that's the idea.