Can a P&L that only reported 1/3 of the current depreciation thus be off on the Net Income, still have a balance sheet that matches Schedule L?
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Can the P&L be off but the balance sheet be correct
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Not in normal double-entry accounting. Has the depreciation been split and 2/3 of it is showing up somewhere else on the P&L? COGS/inventory, an overhead category, Sec 263 adjustment, etc?
You'll need to drill down to the actual depreciation entry, probably in the General Journal. There might also be a prior-period adjustment that somebody closed out to retained earnings, or just a wrong entry somewhere else. There's no end to the number of errors that can be generated by a creative person who doesn't understand accounting. What version of Quickbooks are they using?
When all else fails, pull out a yellow sheet of paper, set up your T accounts, and work it through manually. This always points you in the right direction, even if it doesn't identify the problem precisely.Last edited by JohnH; 09-07-2010, 08:53 PM."The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith
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So what makes up the $20,000 entry? There has to be some detail somewhere - numbers cannot just appear out of nowhere in a double-entry system. What's the source of the numbers - are we talking about a double entry system or is this coming from someone's yellow legal pad? (Your info is a little short on detail in relation to the questions you're asking.)"The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith
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Balance Sheets
Originally posted by Uncle Sam View PostNOPE
Try Accounting 101.
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Originally posted by JohnH View PostThere's no end to the number of errors that can be generated by a creative person who doesn't understand accounting. What version of Quickbooks are they using?
2. Are you implying the individual doing the books wasn't standing close enough to the computer when they waved the box to transform themselves into an accountant?
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Originally posted by Davc View Post1. It's possible to screw up a set of books using a product that didn't come from intuit.
2. Are you implying the individual doing the books wasn't standing close enough to the computer when they waved the box to transform themselves into an accountant?
2) Yep, I think that's a good description - mind if I use it?.Last edited by JohnH; 09-08-2010, 01:05 PM."The only function of economic forecasting is to make astrology look respectful" - John Kenneth Galbraith
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