amount posted to G/L Accounts

[Former Member]

When I save the billing document, the amounts are posted to G/L accounts. Can some explain me the logic for posting signs - like

Customer account is posted +ve

Sales Revenue is -ve

Discount is +ve etc

[Former Member · Accepted solution]

Hi Sunil,

When ever you prepare a billing document it creates an entry in General Ledger as Trial Balance has to be generated for the company all the expenses for a company should be recorded in GL. So that a company can see view their profit/loss figures.

As Billing is a sales related transaction it creates an GL Entry where in

Debits --> Customer Account

Credit --> Sales Revenue Account

And when the Customer Makes a payment with reference to the bill

One more GL Entry will be created i.e

Debit --> Bank Account

Credit --> Customer Account

With this we can track the customer balance (What ever balance is there in Customer account is customer Balance)

I think this is very clear with respect to the question you had asked.

Reward points if it helps.

Regards,

Sreekanth