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Once you post the document you can check the created transaction by pressing the DR-CR sign:
IIt's creating DR Prepayments to Supplier Transaction that should be Reversed and CR Current Trade Payable and adding Payable document in Company's Statement:
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The Above highlighted Advance Expense Record in the Accounts Payable Register will be reversed by Register Correction Document.
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In Dr column select Owner's Current account (BS Capital Issued) and in Cr column select Prepayments to Suppliers (BS Trade and Other Receivables) or other GL account that was select in Accounts Payable Tab of Mutual Settlement document:
4) In the Statement of Mutual Settlements you'll have the Payable amount on this Company's account:
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And the following transactions will be in Trial Balance as a result:
In summary, the entry needed was DR Owner's Current account
CR Current trade payable account Credit (Branch Company)
a) Mutual settlement has created the entry,
DR Prepayment to supplier
CR Current trade payables
b) Transaction general ledger- DR Owner account
CR Prepayments to Supplier
since there is no direct way, and directly recording it using general ledger transaction will not have an effect in the registers and reports, therefore, workaround is to be done, by Mutual settlement, we record the CR part i.e. the Current trade payables and transaction general ledger created the CR part. Prepayment to the supplier account are reversed by adding it as DR and CR in the respective documents.
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