There is no accounting entry into the general ledger accounts when an order is received. The reason is there is no sale or sales revenues and no accounts receivable until the goods are shipped or delivered—depending on the sales terms.

A record will likely be created in the company’s system to track the order, plan for materials, shipping, etc., but there will not be an entry into the company’s general ledger until the order is at the shipping stage.

About the Author: Harold Averkamp (CPA) has worked as an accountant, consultant, and university accounting instructor for more than 25 years.

He is the creator of the AccountingCoach Pro which has been praised for its ability to simplify accounting in a way that anybody can understand.

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