Quicken & Other Budget/Accounting Software/Unrealized gain/loss

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Question
Hi,

If i create a journal for unrealized gain/loss every end on the month, do i need to reverse back every early of the month the next month? If yes, why do i need to do the reversal back?

What will happen if i only create the journal end of the month but did not do the reversal next month?

Let me know the details for both journals.

Answer
Sorry for the delay, I took a few days off.

I recommend reversing it back on the first day of the next month. If you do not , next month you will booking a NET CHANGE for the exchange rate value.  That is complicated and I worry that you my find it difficult to make sure that your underlying values are accurate.  Since the adjustment is for an unrealized gain, it is not a permanent adjustment so it should be reversed.  

The reversing entry is the exact opposite of the entry you do at the end of the month, its just dated the 1st day of the next month.

Linda Saltz, CPA
Advanced Certified QuickBooks Advisor.  

Quicken & Other Budget/Accounting Software

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Linda Saltz, CPA, QBalance.com

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QuickBooks best practices, troubleshooting, accounting, tax We have over 70 pages of website content about QuickBooks tips, running a business, tax and business startup at http://www.qbalance.com

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Accountant and CPA over 20 years. Specializing in accounting software for over 12 years, Certified QuickBooks Pro Advisor, QuickBooks seminar instructor since 1997.
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