Skip to main content
K
Kath4
March 3, 2020
Question

Adjusting Balance Sheet

  • March 3, 2020
  • 1 reply
  • 0 views

Hi. The company I am working with had a prior entity (LLC) and they have moved to an S-Corp as of 1/19. Their prior bookkeeper did not open a new set of books with the new entity. The issue I'm having is, there are old liabilities and equity accounts related to the old entity that we need to be zeroed to have an accurate reflection on the balance sheet for the corp. There should only be two current assets:

 

Initial stock purchase of $1000

Loan to third party 

 

There should not be any existing liabilities. 

 

I have tried making adjustments but no matter how I slice it, either the liability side or the asset side are unbalanced. Any ideas on how to "restart" these accounts in the chart of accounts? 

1 reply

Rustler
Rustler
March 3, 2020

You can't, nor should you.

 

Start a new subscription for the s-corp as should have been done and enter opening balances

 

the old company needs to have its books closed, all liabilities paid, receivables too.  Then the company files a final income tax form.

    K
    Kath4Author
    March 6, 2020

    Thank you for your reply. Does this mean my client will need to maintain two separate QBO subscriptions? 

    A
    AOProServ
    March 7, 2020

    Hi there, Kath4. If your client needs to make any changes to their old books in QBO, they will need to maintain that subscription. However, if the books are closed and needed only for reference purposes, they can cancel the subscription and QBO will maintain read-only access to the data for up to 1 year, during which time you can download or export the data.

     

    See this article for more information on how long QBO maintains your data after a subscription has ended:

    https://quickbooks.intuit.com/learn-support/en-ca/account-settings/what-happens-to-my-quickbooks-online-data-after-i-cancel/00/261773

    Terms & ConditionsAccessibility statement