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Entering a Starting Trial Balance in QuickBooks 2011

In order to record your starting trial balance, you record a journal entry. The journal entry records the trial balance amounts for all your accounts at the conversion or start date except for the account balances of your accounts receivable, accounts payable, and inventory.

As a simple example to show you how this works, suppose that you have the trial balance shown in the table. Notice that no balance is recorded for accounts receivable (this account doesn't even show up in the trial balance), and no balances are recorded for inventory or accounts payable (because these accounts have zero balances at the conversion date).

A Trial Balance
Account Debit Credit
Cash 5,000
Inventory 0
Accounts payable 0
Loan payable 0
S. Nelson, capital 1,000
Merchandise Sales 13,000
Cost of goods sold 3,000
Rent Expense 1,000
Wages 4,000
Supplies 1,000 _____
Totals 14,000 14,000

The figure shows how the Make General Journal Entries window looks when it records the missing trial balance information. After this journal entry is recorded, the trial balance is correct as of the start date.

image0.jpg

You probably won't be lucky enough to have your starting trial balance journal entry be so simple. You probably have to deal with an account balance in your accounts receivable, accounts payable, or inventory account.

Suppose that you have the trial balances shown here.

Another Trial Balance
Account Debit Credit
Cash 5,000
Inventory 2,000
Accounts payable 1,000
Loan payable 0
S. Nelson, capital 2,000
Merchandise Sales 13,000
Cost of goods sold 3,000
Rent Expense 1,000
Wages 4,000
Supplies 1,000 _____
Totals 16,000 16,000

Here's the tricky part of recording this balance. You aren't going to be able to record all this trial balance information through a journal entry. You will record the parts of the journal that are not accounts receivable, not inventory, and not accounts payable. Your trial balance won't balance, of course. To make it balance, you plug in the difference to an account that QuickBooks supplies for just this sort of bookkeeping madness: the Opening Bal Equity account.

image1.jpg

Supplying the missing account balances

With a more life-like trial balance, you don't enter the entire trial balance by using a general entry. Accordingly, you need a way (obviously) to supply the missing account balance balances. The burning question, then, is how do you supply the missing account balances? You supply the missing information when you set up the master files for the customers, your inventory, and your vendors.

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