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parksbarbie
Level 2

Opening balance equity

Someone created a loan in my company's QBO account by Crediting the Loan/liability and Debiting Opening Balance Equity. The Loan acct shows this as the first transaction and showed it as Reconciled. This is a loan we owe but money was never deposited into a bank account. The Loan acct will not let me enter an opening balance since it is already established. This is not part of the opening equity. How do I fix this to show opening equity zero and the loan beginning balance as $30,000?

7 Comments
ReymondO
QuickBooks Team

Opening balance equity

I'll help you fix the beginning balance of your loan account in QuickBooks Online (QBO), @parksbarbie.

 

Before that, let me share some insights on how the Opening Balance Equity is used in the program. This account is the offsetting entry used when entering account balances into the Quickbooks accounting software. This account is needed when there are prior account balances that are initially being set up in Quickbooks.

 

Therefore, when dealing with another current liability account, such as any loan, a credit entry to the account will decrease its balance. This will also apply to any asset account when entering its opening beginning balance in the opposite way.  

 

We can only zero out the Opening Balance Equity if all accounts doesn't have any beginning balance when they were created.

 

However, we can correct the opening balance in the Loan/Liability account by deleting the journal entry that affects it. Just follow these steps:

  1. Go to Reports and search the Journal report.
  2. Click the transaction to open, then select More.
  3. Choose Delete and click OK.

 

Once done, you can now go back to this account and manually enter its opening balance. Here's how:

 

  1. Go to the Accounting menu and select Chart of Accounts.
  2. Look for the Loan/Liability account, then click the drop-down arrow under the ACTION column and choose Edit.
  3. Enter the beginning balance in this account and select Save and Close.

 

In addition, I've included an article on what to do if you've been tracking transactions in QuickBooks for a while but didn't enter any opening balance on your accounts: What to do if you didn't enter an opening balance in QuickBooks Online.

 

If you have any other questions please let me know. I'm always glad to help any way I can.

parksbarbie
Level 2

Opening balance equity

I deleted the journal entry and when I go back to the liability/loan account in the chart of accts and hit edit there is NO OPTION for an opening balance? How do I enter that now?

 

Barbie

MadelynC
QuickBooks Team

Opening balance equity

Allow me to walk you through the steps, @parksbarbie.


Once the journal entry is deleted in the system, it will automatically zero out the balance in the register. 


You'll have to choose a period when you want to start tracking your finances, so it will give you an option to enter the opening balance. Here are the steps:

 

  1. From your Liability account, hit the dropdown arrow under Action.
  2. Click Edit.
    Capture.PNG
  3. In the message that says’s “When do you want to start tracking your finances from this account in QuickBooks?” choose one.
    Capture.PNG
  4. A field will show with a dollar sign beside. From there, enter the amount.
  5. Press the Save and Close button.
    Capture.PNG

 

You can check this article for more information: Enter opening balances for accounts in QuickBooks Online.


This resource also gives you a better way on how to organize Chart of Accounts (COA) moving forward: Understand the chart of accounts in QuickBooks. I’m sure you’ll find it helpful.


Let me know if there’s anything else I can help you with. I’m just right in the corner, take care.

parksbarbie
Level 2

Opening balance equity

When I hit edit this is what I see (attached). As I mentioned there is no option to enter opening balance.

DivinaMercy_N
QuickBooks Team

Opening balance equity

Hi there, @parksbarbie.

 

I'm glad to share with you the other way to edit the opening balance of your liability account in QuickBooks Online (QBO).

 

Here's how:

 

  1. Go to the Accounting menu and select Chart of Accounts.
  2. Look for your liability account and click the View register button. 
  3. Click the balance and choose Edit.
  4. You'll be routed to the Journal Entry page and from there you can edit the opening balance.
  5. Hit Save when done (see screenshots for reference).

liability1.JPG liability2.JPG

 

For more information, please refer to this article: Edit an incorrect opening balance

 

Also, if in case you want to break down your expenses, income, and other transactions to make your accounts organized. You may visit this link for the detailed steps: Create subaccounts in your chart of accounts in QuickBooks Online

 

Keep me posted if you have any other QuickBooks concerns. I'll be here to help. Have a great day ahead.

Pearson Crystal
Level 1

Opening balance equity

If the company has to transfer all opening balances from other accounting software to QB, how are we to do it? Thanks!

MariaSoledadG
QuickBooks Team

Opening balance equity

We make things easier for you, Pearson Crystal.

 

For now, you can only import your bank data, customers and vendor lists, chart of accounts, and product and service information. You can use a CSV file (Comma Separated Values), Google Sheets, or an XLS/XLSX file to import this information to QuickBooks Online. You'll want to manually enter all the opening balances from other software. 

 

In addition, once you connect your bank and credit card accounts, QuickBooks automatically downloads your historical transactions. For more information, please check this article for your reference: Enter an opening balance for an account in QuickBooks Online.

 

Also, QuickBooks Online has different kinds of reports that you can use to show the status of your business. Please visit this article so you'll be guided: Run Reports in QuickBooks Online.

 

Please touch base with us if you any concerns about transferring your data to QBO. Remember, we're here to make things run smoothly for your business.

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