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Reconciliation problem

Posted by Wanda 
Reconciliation problem
August 09, 2013 08:03PM
Last month we paid an employee with direct deposit. He informed us (2 weeks later) he never received his last check. After checking with the bank we discover he gave wrong info for direct deposit. A regular check was cut to the employee. Problem is the bank reconciliation shows the payroll deduction in full for the last month. In order to balance I used the check to balance the account. Now the problem this months reconciliation also show the check but no deposit back from the bank. My reconciliation is off the amount of the check. How do I correct my error.
Re: Reconciliation problem
August 26, 2013 06:52PM
To reconcile, you must show the payment twice or have some kind entry.

So either make the payment twice and then credit back the next month,

OR

Do a journal entry for the 2nd transaction and put it in a holding account. Once you get the credit back from the bank, you can credit that holding account to zero out.

Create a New Chart of account under liability and call it "Payroll Holding Account"

Your bank account would be the second item in that journal entry.
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