Skip to main content
B
bradstreet14
February 20, 2020
Question

Retained Earnings Account is Missing

  • February 20, 2020
  • 2 replies
  • 0 views

I just found out that I need to close the books at the end of the year by transferring profits to a Retained Earnings account.  I keep reading that when a new company is created, Quickbooks will automatically create the Retained Earnings account and will automatically move profits to the account at the end of the year.  However, I do not see any Retained Earnings account in the chart of accounts.  I've also tried looking at the balance sheet for previous years and there is no Retained Earnings entry.  I wasn't sure if I should just make one manually or if there is someway to enable the feature.  If it's relevant, the company is taxed as an SCorp and I'm using Quickbooks Desktop 2014.  Thanks.

2 replies

J
Joshua R
February 20, 2020

Hi there, @bradstreet14.

 

I hope you're having a great week, let me give you some additional information about a Retained Earnings account.

 

When a new fiscal year starts, QuickBooks Online automatically adds the net income from the previous fiscal year to your Balance Sheet as Retained Earnings.

To view your Retained Earnings in the Balance Sheet:

  1. Select Reports.
  2. Locate and select the Balance Sheet to open it.
  3. In the report, locate the Retained Earnings item to see your company's reported net income.

You can distribute the amounts in the Retained Earnings account at the end of your fiscal year using a journal entry. The Debit column will decrease while the Credit will increase your Retained Earnings account.

 

Remember that you must offset every debit with an equal credit.

 

Let me know if this helps, thanks for reaching out to the Community!

 

 

K
kknigge4
February 20, 2020

If you are not seeing an account called Retained Earnings it may have been renamed to Owners Equity

L
LePrimaD
February 25, 2021

My issue with the missing statement of retained earnings is that Retained Earnings include more than JUST the P/L from previous years. It is where you also show the cumulative effects of  retrospective accounting adjustments for prior period errors, change in entity, or change in accounting principle.  It is also where you pay distributions from, the cumulative P&L not the current P&L this is how you determine if it is a return of equity or in fact a shareholder dividend.  

 

My problem with quickbooks is that it is truly a bookkeeping software that people want to use as an accounting system but it has it limitations. The statement of RE is necessary for GAAP accounting.

Adrian_A
Adrian_A
February 25, 2021

It isn't the kind of experience that we want you to come across, LePrimaD.

 

At this time, I'd recommend reaching out to our Phone Support team so we can have your file to be checked.

 

Here's how:

 

  1. From the Help menu, select QuickBooks Desktop Help.
  2. Click Contact Us.
  3. Enter a brief description of your concerns.
  4. Click Continue.
  5. You can select how you'll want to contact us.

 

I'll be around if ever you need help. Keep safe!

Terms & ConditionsAccessibility statement