another release from restriction question

[enyhsnus]

Ok..here's my problem. My balance sheet shows that I have a lot of negative balances on my donor restricted accounts. I double checked my transactions from when I paid them out, and they seem to match up with how the book says to do it. Unless of course I debited the wrong account on the top half of the transaction (i.e. credit bank account, debit equity(?) account) The only other thing I can figure I did wrong, is that I didn't click the release button before I posted the transactions. What would that effect? and how do I fix that if it is the problem? If it isn't the problem what the heck did I do?? and how do I fix it?

Sunshyne

[Jeff]

What was the journal entry you used to pay out the donor restriction? And did you do the release transaction at all?

Your post indicates that when you paid out the donor restriction, you credited the bank, debited the donor retricted equity account and the also did the release transaction. If that is the case, your donor restriction balance will be off. The normal way to handle this you would to not directly debit the equity account, but some other account depending on the nature of the transaction. For example, if the amount should be shown as an expense, you would credit the bank, debit an expense account and do the release transaction.

The release transaction is what updates the equity account. Under normal circumstances you should never directly debit or credit the restricted release account.

[enyhsnus]

What was the journal entry you used to pay out the donor restriction? And did you do the release transaction at all?

I did one transaction (a check). In that transaction for each one I credited the checking account, debited the equity (where I went wrong), debited the release account and credited the released from restriction account. At the end of the transaction, I failed to click the 'release' button.

Your post indicates that when you paid out the donor restriction, you credited the bank, debited the donor retricted equity account and the also did the release transaction. If that is the case, your donor restriction balance will be off. The normal way to handle this you would to not directly debit the equity account, but some other account depending on the nature of the transaction. For example, if the amount should be shown as an expense, you would credit the bank, debit an expense account and do the release transaction.

So, I needed to have just credited the checking account and debited an expense account (which I need to create?).

The release transaction is what updates the equity account. Under normal circumstances you should never directly debit or credit the restricted release account.

Is this a separate transaction I need to create then?

Sunshyne