Opening Balance account location

[Former Member]

Hi All,

I want to now where to create all the opening balance account in B one ie in which drawer ( Equity or expenses)

which is best sugggested as per accounting standard.

Also want to now at end of opening balance will these account be zero..

[Former Member · Accepted solution]

Hi.......

It should be on Equity side....

If you find that guess is wrong then anyway you can shift it to any drawer at anytime as you want.......

Regards,

Rahul

[Former Member]

Thanks

[former_member1269712]

Hi,

The opening balance account is an offset account for G/L account opening balance, A/R opening balance, A/P opening balance and inventory opening balance.

All the opening balances are posted to asset, equity or liabilities and it is been offset with the opening balance account that is located in he drawer expenditure or could be probably in the equity.

Finally, the opening balance account balance should be zero after opening balance process finished.

The accounting equation for balance sheet should be correct after opening balance is finished:

Asset = liabilities + equity

If you place opening balance account in the equity but the equation is not correct afterwards, then it is wrong, so you must place it in the expenditure drawer.

Regards,

Sachin

[Former Member]

Hi,

I have created opening bal a/c in expenditure side only. But due to some reason this account is showing some balance. How do i nullify this accoutn since their has been considerable amount of transaction already done in B one.

Before year end i ned to clear this acount else my P&L will be not proper.

Any suggestion on the same

[Former Member]

Any suggestions pls

[former_member1269712]

Hi,

If you enter Op. balance at the beginning of the year then it will taken care by system. If you enter in between year then at the time of year end your balances are your profit/loss so it will forward by default.

Regards,

Sachin

[former_member1269712]

Hi,

Opening balance account comes under expenditures.

Regards,

Sachin