Example: Journal Entry Between Two Companies
This example shows the entries that the system creates when you enter a journal entry between two companies.
In this example, company 200 accrues a liability incurred by company 50. Accounts for these companies are cleared through the hub, company 1, as illustrated:
For the journal entries, assume that the business unit on the balance sheet matches the company number. You enter this information for the journal entry:
Document |
Company |
Account |
Description |
Debit |
Credit |
|---|---|---|---|---|---|
JE 1000 |
50 |
50.8150 |
Expenses |
500 |
Blank |
JE 1000 |
200 |
200.4110 |
Accounts Payable |
Blank |
500 |
When you post the journal entry, the system automatically generates these intercompany entries:
Document |
Company |
Account/Sub/Type |
Description |
Debit |
Credit |
|---|---|---|---|---|---|
AE 1212 |
50 |
50.1291/00000001/A |
Intercompany Receivables/Payables |
Blank |
500 |
AE 1212 |
1 |
1.1291/00000050/A |
Intercompany Receivables/Payables |
500 |
Blank |
AE 1212 |
200 |
200.1291/0000001/A |
Intercompany Receivables/Payables |
500 |
Blank |
AE 1212 |
1 |
1.1291/00000200/A |
Intercompany Receivables/Payables |
Blank |
500 |
The second and fourth rows are entries to the hub (company 1) from companies 50 and 200.