I look after two companies (common directors). They both received an invoice - same supplier, same amount, which were keyed correctly into Sage. However they paid one invoice twice from one company (Company A) and not at all from the other (Company B). The two payments were made just before year end (both year ends are the same).
Just a couple of days after the year end a payment was made from Company B to Company A and the supplier agreed to allocate the receipts properly at their end.
I use Sage so dont think I can adjust the Creditors control account so am wondered how I make adjusting entries to reflect the year end position with both companies, which will also ensure the supplier is showing as nil. Can anyone please provide me with an idiots guide as Im having major brain block for some reason??
Thanks in advance
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
At the year end is there is an intercompany balance between company A, which has paid the invoice twice, and company B. Lets assume the invoice is £100.
In company A there is a debit balance and in company B there is a credit balance.
Adjustments at year end would be as follows:
Company A - Bank Payment to intercompany account to result in the debit balance due from Company B of £100
Company B -
Dr 9999 £100
Cr Company A intercompany £100
Dummy bank payment
Dr Creditors Control £100
Cr Dummy Bank Account £100
Then do a journal between dummy bank account and 9999 to clear them out
Dr Dummy Bank Account £100
Cr 9999 £100
So the net of the above adjustments is
Dr Creditors Control £100
Cr Company A intercompany £100
Which is what you want. £nil invoice showing for creditor and balance due to Company A for the amount that it has paid twice.
The after year end adjustment in company B will be