Foresight Computer Services is showing a large amount in the Undeposited Funds account. Their income seems very high compared to previous periods. After investigating, you can see that they have been receiving payments from customers and recording deposits using Bank Feeds, posting directly to an income account. They need to produce monthly financial statements for their bank. They have hundreds of payments in the -Undeposited Funds account for a six-month period.

What is the quickest way to fix this type of error?

1. Create a monthly deposit, selecting all the payments for the month on the deposit screen. Select Add funds to this deposit grid and enter the appropriate income account (s), descriptions, and amounts as negative numbers to offset the total so that the deposit total is zero. Repeat for all six months
2. Crete one deposit, then select all the outstanding payments. Add a new deposit line, select the appropriate income accounts, and enter the total amount of the selected payments as a negative so that the deposit total is zero
3. Edit each deposit and check the appropriate payment(s), then delete the sales entry. Make sure the total deposit amount doesn't change. Repeat until all payments have been assigned to the appropriate deposit
4. Make a journal entry to credit sales and debit undeposited funds for each month
5. Make a journal entry to debit sales and credit undeposited funds for each month