cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Level 1

Reconcile for year-end

I am looking at the attached year end checklist.  (One, the links to instructions get error message.)

I want to understand 

Adjust Retained Earnings

I feel I would have a better understanding of my balance sheet without the accumulation of retained earnings.  I do not need it for any kind of valuation.  Is it advisable to zero out retained earnings end of year and how is that done.

1 Comment
Anonymous
Not applicable

Re: Reconcile for year-end

Hi there, @MVEBA.

 

Let me help share some insights about reconciling your year-end in QuickBooks. 

 

QuickBooks adjusts your Income and Expense accounts at year-end to zero them out so you start your new fiscal year with zero net income. On the first day of the new fiscal year, QuickBooks increases your Retained Earnings equity account by the previous year's net income and decreases your net income by the same amount. This way, you start each new fiscal year with a net income of zero. 

 

Let me route you to this article for more information: Close your books in QuickBooks Desktop.

 

When reconciling for your year-end, your income and expense should be zeroed out, but not your retained earnings.

 

I'm here to help if you have additional questions or clarifications about your retained earnings. Have a good one.

Need to get in touch?

Contact us