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Highlighted
Level 1

Journal entries for business dissolution

Hi there, 

 

I have a company, which owns mainly financial assets, transferred all the assets to the new setup company. Currently their book looks like this:

Asset

Investment                                         100

Investment - unrealized gain/loss  20

Total                                                     120

Liability and Equity

Capital stock                                      125

Retained earnings                             -15

Net income                                        10

 Total                                                    120

 

Does anyone know how to make journal entries to zero out the balance sheet for the old company and how to start the new company? Thanks a million!!!

1 Comment
Highlighted
Level 15

Journal entries for business dissolution

Unless I am missing something, unrealized gain/loss

is not offset in the equity part as it should be

 

If you ended one business to start another you need the help of a tax accountant - there are personal tax implications to consider too

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