# Sale Confusion

Hi,
I am getting good day by day with your help.

I am unable to understand the balance sheet.

I am running a publishing house.
I got an order to print 1000 Books. which price is for example 1000
I recieve 50% advance but when i create a sale invoice it would be the full amount invoice.
I also add recieve money and after it shows me the due amount as well. All is well here.

I am only dealing with a cash account which is my bank account also.

Now the problem is here
My total sale is 190000 and some projects are under process.
Less expenses 1412536

Net Profit 560222

But as i mentioned some projects are under process and i haven’t recieved the full amounts of said invoices.

Now according to Manager My assets
Account recieveable = 707,693
Cash & cash equivalents = 264,956

Less Liabilities = 84737

Equity

Retained earnings = 560,222
Suspense = 330,390

If I follow Manager it tells me that I have 264,956 cash
But i have not in real.

Can you please explain me which points i am not getting.

Without seeing your entire balance sheet and profit and loss statement, these figures do not provide enough information to tell whether anything is wrong or, if there is, what the problem might be. If you are new to accounting and trying to understand the meaning of the various reports, I recommend spending some time at one or more of the excellent educational sites on the web. You might start at http://www.accountingcoach.com.

Once you understand the basics of double-entry accounting, please return with specific questions about how to use Manager. In particular, it sounds like you need to understand the difference between accrual and cash basis accounting so you know which to use for your business.

1. I would suggest one part of your problem is the Account - Suspense with a balance 330,390.
That account shouldn’t be showing at all, so the transactions that make up that balance contain entry errors.

2. Your stated total sales of 190,000 less expenses of 1,412,536 equals a Loss of 1,222,536, not a net profit of 560,222 as listed above. unless you meant the sales were 1,972,758 as that would make sense with your net profit amount also matching your retained earnings amount. This is your first year of business.

3. Also with sales of 1,972,758, your accounts receivable at 707,693 looks more reasonable compared to with sales of only 190,000 - with accounts receivable of 707,693 being 3.7 times the size of sales.

4. I have reconstructed your balance sheet and based on the figures provided it doesn’t balance.
707,693 + 264,956 - 84,737 - 560,222 - 330,390 = -2700
Now as 2700 is dividable by 9 (=300) I guessing that a possible transposition of numbers has occur ?

Your first focus should be on addressing the errors that are causing those transactions to be posted to the Suspense account.