Journal entries for Customer Receipts in AR

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Some of us are still confused with O2C journals, especially on the Receipts side. I am trying to clarify the same here. If you need to understand the complete flow and journals of O2C you can refer to the same in my blog which I already posted before.  

Let me explain how the receipts are accounted for using different remittance and clearance methods.

Receipt with no Remittance and clearance method By Matching

When creating Receipt

Remitted Cash A/C…..Debit

Unapplied Cash A/C…......Credit

When applying receipt to open invoices

Unapplied Cash A/C…...Debit

Receivables A/C…....Credit

When reconciling in Cash Management

Cash A/C….....Debit

Remitted Cash A/C…...Credit

Receipt with Remittance

When creating Receipt

Confirmed Cash A/C……………Debit

Unapplied Cash A/C…......Credit

When applying receipt to open invoices

Unapplied Cash A/C…...Debit

Receivables A/C…....Credit

When sending for remittance

Remitted Cash A/C…..Debit

Confirmed Cash A/C……Credit

When reconciling in Cash Management

Cash A/C….....Debit

Remitted Cash A/C…...Credit

 Receipt with No Remittance and Clearance Method of Direct

When creating Receipt

Cash A/C….....Debit

Unapplied Cash A/C…......Credit

When applying receipt to open invoices

Unapplied Cash A/C…...Debit

Receivables A/C…....Credit

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