Common Journal Entry Scenarios

This article provides practical examples of when and how to use journal entries.


If you are not familiar with journal entries in general, please first read:
Understanding Journal Entries (General Guide)

Scenario 1: Transferring a Tenant Deposit to a New Tenancy

Use case
A tenant moves from one property to another and asks for their existing deposit to be transferred to the new tenancy instead of being refunded.

Steps

  1. Open the Journal Entry window.

  2. Enter a description (optional).

Create the outgoing transaction

  1. Click Add Transaction.

  2. Select Tenant Outgoing Payment.

  3. Select New Refund.

  4. Apply the amount to the outstanding payment due to the tenant.

This creates the debit side of the journal entry.

Create the incoming transaction

  1. Click Add Transaction.

  2. Select Tenant Incoming Payment.

  3. Select the tenant for the new tenancy.

  4. Apply the amount to the outstanding invoice.

The journal entry now balances.
The deposit has moved from one tenancy to another with no cash movement.


Scenario 2: Holding Deposit Offset Against Letting Fee

Use case
A letting agent has:

  • Collected a holding deposit from a tenant

  • Issued an invoice for their letting fee

Instead of paying the full fee and separately collecting the deposit, the holding deposit is offset against the letting fee.

Steps

  1. Open the Journal Entry window.

  2. Enter a description (optional).

Record the tenant payment

  1. Click Add Transaction.

  2. Select Tenant Incoming Payment.

  3. Select the tenant.

  4. Apply the amount to the outstanding invoice.

Offset the supplier payment

  1. Click Add Transaction.

  2. Select Supplier Outgoing Payment.

  3. Select the supplier.

  4. Apply the amount to the outstanding supplier invoice.

This settles the letting fee and records the holding deposit without moving funds.


Scenario 3: Moving Funds Between Landlords

Use case
Funds need to be reallocated from one landlord to another.

Steps

  1. Open the Journal Entry window.

  2. Enter a description (optional).

Remove funds from the first landlord

  1. Click Add Transaction.

  2. Select Landlord Payout.

  3. Select the landlord you are taking funds from.

  4. Apply the amount.

Add funds to the second landlord

  1. Click Add Transaction.

  2. Select Landlord Deposit.

  3. Select the landlord receiving the funds.

  4. Apply the amount.

The journal entry balances and the funds are correctly reallocated.