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SRK2024
February 20, 2024
Question

Sole Trader - Retained Earnings Account

  • February 20, 2024
  • 1 reply
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Hello - In my chart of accounts I have an equity already setup 'retained earnings' my company type is set up as sole trader using cash basis accounting. I can neither change the retained earnings equity account to 'owners equity' or make it inactive. As I understand it I only need  'Owners Equity' and 'Owners Draw' equity accounts?

1 reply

A
Ashleigh1
February 20, 2024

Hello SRK2024, thanks for posting on the Community page, so you said that you can't change the equity account nor make it inactive so I'm guessing you're getting an error telling you that retained earnings is a default account and that it can't be marked as inactive. 

 

You could just create a new chart of accounts for owner's equity and just make sure you select that account when you need to use it. 

 

 

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