Journal Entry Reversal
Journal entries can also be used to reverse ledger entries that have already posted to accounts. These are known as reversing journal entries.
You may want to set up a journal entry to automatically reverse itself. These reversing journal entries do not require you to manually track the transaction. For example, you enter an accrual transaction for revenue earned but not yet received. Next month, you must make a journal entry to reverse that accrual entry.
A reversing journal entry is an exact opposite of the original journal entry. For example, the original journal entry debits Accounts Receivable $100, credits a revenue account $100, and has an exchange rate of 1.5. The reversing entry credits Accounts Receivable $100, debits the revenue account $100, and has an exchange rate of 1.5 regardless of the current exchange rate.
A reversing journal entry is also permanently linked to the original entry. Any change you make to the original entry affects the reversing transaction. You cannot directly edit a reversing journal entry.
To create a reversing journal entry, go to the Journal entry page. In the Reversal Date field, enter the date on which you want the reversing entry to be posted. Complete the remaining information as required, and click Save. For more information, see Reversing Journal Entries.