Example: Journal Entry Between Two Companies

This example shows how the system creates entries when you enter a journal entry between two companies. In this example, company 200 accrues a liability incurred by company 50, as illustrated:

For the journal entries, assume that the business unit on the balance sheet matches the company number. You enter one journal entry with two lines:

Document	Company	Account	Description	Debit	Credit
JE 5000	50	50.8150	Expenses	500	N/A
JE 5000	200	200.4110	Accounts Payable	N/A	500

The company on the first line of the journal entry determines the hub company. When you post the entry, the system automatically generates these intercompany entries:

Document	Company	Account/Sub/Type	Description	Debit	Credit
AE 5000	200	200.1291/0000050/A	Intercompany Receivables/Payables	500	N/A
AE 5000	50	50.1291/00000200/A	Intercompany Receivables/Payables	N/A	500

The second row is the entry to the hub (company 50) from company 200.