1120 Bonco, Inc. Case Study Facts: Data Entry

General Information

See the Trial Balance Bridge Guide for an overview of bridging, definition of terms, and explanation of the bridging process.

Access the Bridge software. If you have the tax application installed, from within the return, select Access > Trial Balance.

Transferring the Excel File into the Bridge

The Bridge must be told the kind of source file that contains the trial balance information that you will be using.

Select File > Import. The Data Source Selection dialog box appears.
Since you will be importing a DIF file and not one of the predefined general ledger or audit packages, under Data Source, be sure User Defined is selected. This activates the New button.
Click the New button. The User Defined Import Template dialog appears.

The Trial Balance radio button is already highlighted since that choice is the default.
Enter TRIALBAL1 as the Template Name (no spaces are permitted in the template name field). Enter STANDARD TRIAL BALANCE NUMBER 1 as the description. (For this lesson, put your initials in the description.)

You may use any name and description that you prefer. However, the names chosen should be meaningful to you so that they can easily be found later for use with other returns, if needed.
Under Source File Format, Automatic Detection should be selected.
Enter the drive, path, and filename of your source file.

OR

Click Browse, and then select the file from the Open dialog. The drive/path field for this exercise’s DIF file is the drive/path for the bridge software (for example, C:\ProgramFiles (x86)\RIA\RS2019\BONCO.DIF).
Click Open, and then click OK. The User Defined Import Template dialog appears.
Select the items to be imported under Import Item.
Highlight Account Number by clicking it once.
In the Mark Import Item area on the lower portion of the screen, highlight the column in the source file containing the account numbers.
The column designator appears in the Column field next to the Import Item.
Repeat this process for Account Description, Tax Return Code, Prior Year Balance, and Current Year Balance.

The file BONCO.DIF is located in the C:\ProgramFiles\ RIA\RS2019 directory.
Column
Description
A General ledger account number
B General ledger account description
C Tax return code
D Prior year adjusted balance
E Current year book balance
Data in the DIF file begins on line 2. Enter the row number where you want the import to start. Data on the row you select and all following rows will be imported.
Click the Save button. The Import dialog appears.
The new trial balance template that you created, Standard Trial Balance Number 1, appears in the Description field.
Highlight that template, and click the Import button.

OR

Select the template name on the list. The Import Trial Balance dialog appears.
Enter the drive, path, and file name of your source file (for example, C:ProgramFiles (x86)\RIA\RS2019\BONCO.DIF).

OR

Click Browse, and then select the file from the Open dialog. Then click Open.

Under Import Items, select the items you want to import. Account Number and Account Description are mandatory items, so they are preselected. Tax Return Code, Prior Year Balance, and Current Year Balance should also be selected.

For returns that have been completed by the software in prior years, you do not usually Bridge prior year balances because they already exist in the tax return file.
Click the Import button. The Import Progress dialog appears along with the Import Trial Balance dialog box.
When the import process is complete, a confirmation message appears and also indicates if errors were found. The message Import Complete, Errors found appears.

Column	Description
A	General ledger account number
B	General ledger account description
C	Tax return code
D	Prior year adjusted balance
E	Current year book balance

Reviewing Transfer Errors

Click the OK button. The Trial Balance dialog appears again with the message Do you want to add this File and Format to the Auto Import List.
Click the No button, and then click Done.
The Import dialog appears.

Any entries that appear in the error list will be excluded from the import into Bridge.
The error message was generated because the account description for the Account Number “Bonco, Inc.” is missing. This error occurred because the first line of the DIF file contained “Bonco, Inc.” and it was transferred into the account field. On the Format dialog, we can designate where we want to begin the import. Since we made no entry, the bridge started with the first line in our DIF file: the company name, “Bonco, Inc.” While this particular error may be ignored, in some situations you may want to designate the proper import starting position or make changes in the DIF source file in order to get the proper entries imported into the bridge from a DIF file.
The Import Trial Balance dialog appears. Click Done.
The Import dialog appears. Click Done.
The Trial Balance appears with the imported account information.

Checking for In-Balance

Select Options > Calculate Now. The Calculating Summary Totals dialog appears.
When all calculations are complete, select View > Tax Summary. The Tax Summary screen appears. This screen identifies out-of-balance returns by showing any differences in Income, Balance Sheet, and Reconciliation of Equity items.
The Ending Balance Sheet is out of balance by $425. While there may be several reasons for this error, a common one is that an entry is missing a TRC code. This would exclude the amount from the trial balance totals. Let’s return to our Trial Balance Grid to look for an entry in the amount of $425.
Close the Tax Summary screen.

Assigning a TRC

The Trial Balance Grid appears.
Scroll right to view the CYB column (Current Year Balance).
Scroll down to look for an entry in the amount of $425.
When located, notice that the entry is missing a TRC code.
Scroll left. Notice that the entry is for Interest Expense and is for Account No. 550B.
To assign a TRC, click the drop-down list arrow for TRC in the upper portion of the screen.
Scroll down the list until you find 41-500 Interest and select it. 41-500 is the TRC for Interest Expense.
Click the TRC field for Interest Expense and then click the Assign Coding button. You may also simply enter the TRC in the proper column and press Enter.
Select Options > Calculate Now. When all calculations are complete, select View > Tax Summary once again to insure that the change that was made balanced the data. This time the data is in balance.
Close the Tax Summary window.

Journal Entries

Select Ledger > Journal Entries from the menu bar.
To enter the journal entry for Officers’ Compensation, select Tax Reclassification as the type of journal entry. Click the New button. Enter OFFICERS’ COMPENSATION as the journal entry description.
Tab to the Journal Entry Grid. Enter TAX41-210 in the Account field. The TRC for Officers’ Compensation is 41-210. You can use the word TAX followed by the TRC to create an account used only for tax return amounts.
Enter $40,000 in the Debit column.
On the next line, enter 510B in the Account column and $40,000 in the Credit column. The Description column is completed automatically.
Click Done, and then click Done again.
After all journal entries have been made, insure that the files remain in balance (see Checking for In-Balance above).

Merging the Bridge Information

You have transferred data from an Excel file into the Bridge, corrected errors, posted a journal entry, and checked to ensure the data is in balance.

Select Options > Merge Now from the menu bar. This will combine data from the Bridge files with the tax return files. Click Yes if the program asks if you want to continue.
Close the Bridge.
Select Organizer > Income and Deductions > Deductions > Detail.
Verify that $11,150 is in the Depreciation to Page 1 (if no detail or override) data entry field.
Select Organizer > Balance Sheet M1-M2-M3 > Schedule M1/M2 > Reconciliation (M-1) tab.
Verify that $23,566 is in the Net income per books data entry field.
Verify that $5,693 is in the Federal income tax data entry field.
Perform a full recompute of the return. Select Compute > Full Recompute.

Case Study Facts/bonco_data_entry.htm/TY2019

Last Modified: 03/19/2020

Last System Build: 06/17/2021