Example of Using Multiple Balancing Segments

This simple example illustrates balancing along two balancing segments for a simple chart of accounts with three segments.

Scenario

Your company has a chart of accounts with two balancing segments and three segments, qualified as follows:

• Company: Primary balancing segment

• Cost Center: Second balancing segment

• Account: Natural account segment

The following table shows a journal that was entered to transfer advertising and phone expense from company 1, cost center A to company 2, cost center B.

Line	Account	Debit	Credit
1	Company 1-Cost Center A-Advertising Expense Account	600
2	Company 2-Cost Center B-Advertising Expense Account		600
3	Company 1-Cost Center A-Phone Expense Account	800
4	Company 2-Cost Center B-Phone Expense Account		800

The posting process creates journal lines to balance the entry across the primary and second balancing segments, company and cost center. The following table shows all of the journal lines, including balancing lines 5 through 8, which were automatically created.

Line	Account	Debit	Credit
1	Company 1-Cost Center A-Advertising Expense Account	600
2	Company 2-Cost Center B-Advertising Expense Account		600
3	Company 1-Cost Center A-Phone Expense Account	800
4	Company 2-Cost Center B-Phone Expense Account		800
5	Company 1-Cost Center A-Balancing Account		600
6	Company 2-Cost Center B-Balancing Account	600
7	Company 1-Cost Center A-Balancing Account		800
8	Company 2-Cost Center B-Balancing Account	800