On 4/22/2021 2:30 PM, Jose A. Lorido III wrote:
Hi Derek,
Thanks for your advice, however, I'm still not sure what to do with the
balances I had on 12/31/2020 in my Equity Accounts
(Additional-Paid-In-Capital, Opening Balances, and Retained Earnings
accounts) and how to add them to the beginning balances as of 01/01/2021.
Could you clarify?
Kind Regards
*Jose A. Lorido III*
Managing Director
Question 1: Are you creating a new set of books for the new year? (like
would have been done in the old days of pen and ink on paper)
Question 2: Are you trying to use the "opening balance wizard" or are
you doing it the traditional way with an opening transaction(s)?
Let's for the moment assume the answer to the first is yes and for the
second (what some giving advice seem not to be spotting is that since
because things like "Additional-Paid-In-Capital" and "Retained Earnings"
mean this is possibly the books of a corporation)
First -- you say you have the 12/31/2020 balance sheet, yes? That means
that if all those amounts/accounts were entered in a single giant split
on both sides transaction, that transaction would be in balance. It
could be the first transaction of the new set of books, dated
12/31/2020, description something like "open 2021 books". So that is ONE
way. But a split transaction that is split on both debit and credit side
isn't the easiest thing to enter. But that would be an exact mirror of
how done in the days of pen and ink on paper.
OR -- let's say you want to use the tool. You enter all the asset and
liability accounts each with their starting balance, and gncash uses
starting equity for the other side of those (hidden) transactions. You
will see that this doesn't match what's on your balance sheet for
starting equity and that those other equity accounts are missing
amounts. You then enter a split transaction just affecting the equity
accounts, making the main equity amount match and the right amounts in
each of those other equity accounts << that SHOULD be an in balance
transaction >>
Michael D Novack
PS -- The FIRST action you should take after opening these new books is
immediately run a Balance Sheet. Compare with the one you used to create
this set of books. Should be an exact match.
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