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Outstanding Checks from Prior Year

Outstanding Checks Payable

Is there a balance of checks that have not been cleared from the previous year?
To manage checks that have not been cleared, you can follow these steps:

  1. Create an “Outstanding Checks Payable” account under the Liabilities section of your chart of accounts.
  2. Enter the balance amount of the checks that have not been cleared in the opening balance column of the “Outstanding Checks Payable” account.
  3. Whenever a check is cleared, record the transaction in the Withdrawals section of your accounting records. This involves crediting the bank account and debiting the “Outstanding Checks Payable” account. By doing so, you will update the balances and reflect the cleared checks in your financial records.
Total outstanding checks for $900 not cleared as of beginning of year
Cleared Check Transaction for $700
Remaining $200 remaining to be cleared in Balance Sheet
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