Revenue Reconciliation of the Revenue Amounts for July and June

During invoice processing, the system uses accrued accounts receivable as the clearing account for the revenue recognition and invoice amounts during the reconciliation of revenue.

The system creates these invoice journal entries for the reconciliation of the revenue recognition amounts:

G/L Date	Account	Debit	Credit
July 25, 2005	Accrued revenue	1,150.00
July 25, 2005	Revenue		(1,150.00)

This illustration shows the T-account postings in the general ledger:

The system uses these AAIs to direct the system to create the journal entries:

• Billing AAI table number 4831 directs the system to the base rules for the accrued revenue account.

  It creates a debit journal entry for the revenue recognition amount.

• Billing AAI table number 4811 directs the system to the base rules for the actual revenue account.

  It creates a credit journal entry for the invoice amount.

After all the journal entries have been posted, the accrued accounts are reconciled. Only the actual revenue and accounts receivable accounts contain balances for the invoiced workfile transactions.