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We record all the cash receipts during the whole year on its debit side. Whereas, we write all the cash payments for the whole year on its credit side. We include both receipts and payments in cash whether they are of capital and revenue nature. We record only cash transactions in receipt and payment account.

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When the invoice is paid, the amount is recorded as a debit to the accounts payable account; thus, lowering the credit balance. The higher the accounts payable, the higher its credit balance is, and the lower the accounts payable, the lower its credit balance.

When registering a new payment, you must select a customer or vendor, the payment method, and the amount of the payment. The currency of the transaction is defined by the payment method. If the payment refers to a document (sale order, purchase order or invoice), set the reference of this document in the memo field.

What to Include in a Journal Entry? The date of the transaction. The account name and number for each account impacted. The credit and debit amount. A reference number that serves as a unique identifier for the transaction. A description of the transaction.

What Is a Journal Entry For Accounts Payable? Accounts Payable Journal Entries refer to the amount payable in accounting entries to the company's creditors for the purchase of goods or services. They are listed as current liabilities on the balance sheet, and any payments made are deducted from this account.