Big Picture: How GL transactions flow through OneSource

Author: support staff Reference Number: AA-00585 Created: 2011-02-15 04:36 Last Updated: 2018-10-04 09:52 0 Rating/ Voters

OneSource Transaction / Accounting Flow.
Note: To help illustrate how how Debits and Credits are effected (and actually flow through OneSource) we will use a ficticous example of a man who decided to open a busines, buy a few items, sell a few items, etc...  This example should help to clarify what is debited and credit (and why).
OneSource Form Debit Credit Account Notes
Deposit Money in New Bank Account

Opens a Bank Account at ABC Bank. N/A N/A N/A N/A This takes place at physical Bank location.
Deposits $10,000 in the Bank Account. N/A N/A N/A N/A This takes place at physical Bank location.
Opens up OneSource, Creates a New Bank Account. Check Writer N/A N/A N/A No money deposited yet.
Makes a "Beginning Balance" adjustment on the Adjustments tab of the Check Writer.       OneSource has a table called Check Writer. This table is the record source for the Check Writer form that tracks all Checks, Deposits, and Adjustments.  OneSource also has a GL Transactions table that is automatically updated with the proper debits and credits to all accounts when any "transaction" (such as an Invoice, Invoice Payment, Bill, Bill Payment, etc) is "posted".
Order Inventory Item on a PO - 1 Piano   Purchase Order N/A N/A   Even if PO originates from one of the Batch Create PO processes, still end up ordering all items on Manually or Automatically created POs.
Receive Inventory Item - Piano   Purchase Order N/A N/A   Inventory COUNT is increased but no change to Inventory GL Account value.  (At this point, the additional value, and the associated liability, is not recognized in the books. This will take place when the Supplier/Vendor Bill arrives and is entered & posted to the GL.
Receive Bill (Invoice) for Piano   Enter Bills       Link Bill to existing PO.
  Increase Asset (Debit Asset - Inventory)   5000   Inventory  
  Increase Liability (Credit Liability - AP)     5000 AP  
Pay for Inventory Item - Piano   Pay Bills - Multiple Suppliers (or Pay Bills - One Supplier)        
  Decrease Liability (Debit Liability - AP)   5000   AP  
  Decrease Cash (Credit Asset Act - Cash)     5000 Cash  
Customer requests for a Quote.   Quote N/A N/A   (No change to GL or Inventory Level)
Customer places Order for 1 piano.   Sales Order N/A N/A   Sales Order created. Inventory Level Decreased when Qty Shipped field is entered.  No change is made to GL Inventory Account VALUE. Total sale is $6000 for piano, $30 for freight + 396 for Sales Tax.
Invoice created. (After item is shipped).   Invoice        
  Increase Asset (Debit A/R Account)   6426   A/R  
  Increase Sales Revenue (Credit Sales Acct)     6000 Sales  
  Earn more money one Freight (Credit Freight Income acct)     30 Freight  
  Charge sales tax. (Credit Sales Taxes Payable)     396 Sales Taxes Payable  
  Decrease Asset account (Credit Inventory Accout)     5000 Inventory If Item is STOCK item.  Looks for Inventory GL account listed in individual item properties on financial tab.  If none, finds default Inventory GL account in Company Setup form.
  Increase Cost of Goods Sold (Debit COGS expense acct)   5000   COGS If item is STOCK item.  Looks for COGS GL account listed in individual item properties on financial tab.  If none, finds default COGS GL Account in Company Setup form.
Item Returned             
  Credit A/R Account   6426  
  Debit Sales Revenue Account  6000   
  Debit Inventory Account  5000   
  Credit COGS   500-10  
  If item is returned, all Invoice GL transactions listed above are reversed. Credit Memo     Sales or Sales Discounts or Sales Returns, etc.. Enter a - value.  For example, If returning 5 items enter -5.
Receive Payment.   (2 options) Receive Payments, Invoice        
  Increase Asset - Cash (debit Deposit To account - usually "Undeposited Funds" account - until actually transferred to a Desposit slip and actually deposited in Bank Account).    6366   Undeposited Funds When press "Apply Payments" button on Receive Payments form.  Otherwise when Invoice is "Posted".  Undeposited Funds accounts is a tempory holding account until transferred to deposit slip and into the cash/bank account.
  Early payment discount (Offset Income by Debiting Sales account or special Sales Discounts type of field)   60   Sales or Sales Discounts We assumed here that the customer took a 1% early payment discount.
  Decrease Asset - A/R account (credit A/R account)     6426 A/R  
Deposit the Check.   Deposit Slip       New Deposit, Deposit Slip Button. Transfer the Undeposited checks to the Deposit slip by clicking on the Undeposited Checks button.
  Increase Asset Account (Checking Account)   6366   Check Account Transferred Debit Balance to Checking Account.
  Decrease Asset Account (Temporary Holding Account)     6366 Undeposited Funds  
      34218 34218    
*Each of the Applicable GL Transactions above can be performed on the "Batch Post GL Transactions" form.