 And then everything looks good except the description I want to now call reversing entry So I'll just copy that and put that down on everything. I don't want it here There's nothing there So now we're going to decrease accounts receivable, which is usually the form that decreases is usually a payment form So but we don't we're not having a payment here. It's a journal entry, right? So we're decreasing we have to assign it to our customer or else QuickBooks won't let us post it We're not assigning to an actual customer, but rather made up a customer called ZZZ so that it will be at the bottom of the customer list Hopefully not messing up our our bookkeeping and then we have the unearned revenue on the other side Decreasing unearned revenue taking it back down to zero reversing what we did so that the books were correct on an accrual basis as of the cutoff date of 229 February 29th the end of February and then we reversed it to get back to the process that works from the accounting or Bookkeeping side of things with a reversing entry following the cutoff date on March 1st, let's save and close it check it out So I'm going to go back here. I'm actually going to close this one and go back into the balance sheet and then run it and If I go into Accounts receivable here for March And then we see we have the reversal So here's the reversal the 450 if I go back to the prior period. Let's go to 0 to 29 24 then we can see we put it on the books before so it's correct as of the cutoff date and then we Reversed it right after all right and so I'm going to go back and then say exit and then on the Other side of things The unearned revenue we put it on the books for February and then it's been reversed It's back down to zero in March if I go into March We see the 450 reversal if I change the beginning date to go back to 229 We see the input that was input at the end of February reversed at the beginning of March Let's go back. Let's take a look at the sub ledger And so if I go back to the sub ledger here run it as of 229 Well, let's run it now as of 03 31 2 4 So if I run it there now The ZZZ has these two in it So it's still kind of messy my sub ledgers messed up Because I'd like these two to net out against each other and basically disappear the totals at the 22701 50 which is good and at least these are not in one of the customers like Eric music I don't have that ugliness up in Eric music, but I think I could fix that first though Let's take a look at the balance sheet. We're at 22701 So this is that on the balance sheet 22701 Let's go internally now and look at it inside here So I'm going to go back out of my customer and then back into it or refresh the screen is what I'm trying to do Go back into ZZZ So now we have these two items. So here's the the journal entry we made on 229 Then we reversed it. I would like this to be closed out with a green thing here So notice if I did this internally in Eric music This would look messy even messier than normal right now because It's a journal entry and it's not closed out to each other. So it would confuse us internally But I can't close it out against each other by creating a payment form So I'm going to select the drop-down and select a payment form usually this would be the form We would use when we get a payment from a customer We're not actually getting a payment what we're going to do instead is apply What is in essence a credit balance to what in essence is a mock invoice kind of thing? Because this is kind of like an invoice an increase and this is kind of like a credit some kind of credit because it's a decrease So if I use the payment form I can use this to tie those two things together So ZZZ I'm going to do it as of 3-1 and I'm not going to add a payment method I'm going to keep it in payment to deposit the payment form usually decreases accounts receivable and puts the other side into Some kind of either the checking account or this clearing account payment to deposit But in this case what I'm doing is I'm going to say accounts receivable is going to go up and back down again Meaning I'm just tying together the fact that there's a credit balance a decrease in accounts receivable and a debit balance an increase So I'm just taking and tying these two journal entries out So nothing should actually be recorded notice that this is something that most CPA firms Might not know how to do because they understand things from a financial statement standpoint So they understand how to do the debits and credits and make the financial statements correct what they might not be so good at is This kind of thing to clean up the internal bookkeeping for the normal bookkeeping process So this if you're in a CPA firm this kind of thing if you can convince the partners who are usually older people that might not Understand some of the dynamics internally and the importance of doing this kind of thing for the bookkeeper inside For internal purposes. They're just trying to get the financial statements. Correct. You might be able to add some value By pointing this stuff out. Okay, but if I record this Then we've got these are checked off now So now even if I recorded this transaction into a customer balance It at least in other words if I did this in Eric music, for example It wouldn't mess up the bookkeeper too much because these things should be tied out and closed out against each other Even though it's still kind of ugly looking because you've got these journal entries In there in the detail so in other words if this was in an actual customer field and and it was Eric music and Eric music Contacted us and we're trying to explain the audit trail to Eric music of his customer information In voices and payments. It's gonna be a little bit more difficult when I'm going. Oh, well, yeah Well, then there was like this credit, but it's a journal entry. That's weird I don't know and then there was this debit, but at least they've been paid and everything was paid out with those Right that gets a little confusing you the bookkeeper would have to know that this was something that was done by the CPA I think it's better. That's why I argue to put it in its own customer file So all the ugly stuff is kind of in its own customer file. Okay, so if I go back then to to this one My report and run it again Notice that the ZZZ is gone now because those two have been collapsed against each other We no longer have an outstanding journal entry. So that actually works pretty nice 22701 50 still ties out to what's on the balance sheet for March 22701 50. All right So that's where we stand as of this point in time and If I go to the to the to the profit and loss, this is where we stand and Let's take a look at the trustee trial balance. It's going no impact on the profit and loss By the way, we already mentioned that I won't go into that again trial balance. This is where we're at So if you're following along and you're in the same place We are then great because I think we're in an excellent spot here. I think we've been Been moving along quite quite nicely So they're good work. We leveled it up. All right