Companies sometimes charge services to another company within their organization. For example, one company is for Roustabout services (WINGL). WINGL then bills the operating company (LEARN) for these services. When Consolidation (Account level) or Combination (Sub-Account level) is used, the income and expense between these 2 companies have a net effect of zero. At the Consolidation or Combination level, management does not want to see those particular entries on the Income Statement.

The user creates a special Elimination company for these elimination entries and a special journal in that company to record these types of transactions (or you can create entries in the Consolidated/Combination company).

We created a new company code ELIMN (normal type company) and created a special journal in this company for just this purpose. The entries in ELIMN are the reverse of those in LEARN and WINGL.

When the user prints the financials, those entries do not appear on the Income Statement or the Balance Sheet.