Home› Accounting› Accounting Technical Support

Invoice sent in 2019 but paid in 2020

SonalSonal Member Posts: 4

Can someone help me with this question?

  1. Work was done for a client in December 2019 but due to the holidays, I got paid in 2020. Does Wave record this income (and the sales tax associated with it) as 2019 income or 2020?
  2. Do I need to make a journal entry of some sort to account for the fact that the invoice was not paid until 2020? If so, how do I do that?
in Accounting Technical Support

Comments

  • MikegMikeg Member Posts: 995 ✭✭✭

    @Sonal,
    If you used invoicing from Wave and sent an invoice dated in 2019, then sales would include that invoice even if you have not been paid. This is accrual accounting. To convert to cash, I export the trial balance into a CSV and make manual adjustments to convert accrual to cash for tax reporting. You can make an entry dated 12/31/19 but would need to reverse it on 1/1/20. That would be Debit Sales XXXX.XX and credit Accounts receivable for the same amount.

Sign In or Register to comment.