On creating a new account in QuickBooks, you need to select a starting date and to provide an opening balance that matches the balance in your bank account. To ensure that QuickBooks is able to match each transaction that you record with the one that appears in your bank statement, this process is necessary. Otherwise, Add Closing & Opening Information into my QuickBooks Account you won’t be able to reconcile your books properly, leading ultimately to different errors.
In this article, you’ll learn how to add closing and opening information into your QuickBooks account.
Note: working with opening and closing balances in QuickBooks Desktop can be difficult. If you’re struggling with the same, reach out to our experts via QB live chat 24×7.
What is an Add Closing & Opening Information into my QuickBooks Account Desktop?
A principal amount is the revenue that a business possesses at the start of a certain income statement. A day, per week and, a quarter, a semester, or a year could have been the time frame. Establishing a starting statement can also help a company analyze its performances or respond to concerns from outside sources like customers or financial regulators.
The opening balance in accounting and finance is the sum that has been attained by the preceding financial statement, during which point it is referenced to as the ending amount, if a company has operated via at most one specified fiscal period.
Here’s How Opening Balance Work in Accounts
When you start a new account in QuickBooks Desktop, you need to pick a starting date. This starting date marks the start of the fiscal period. The closing date is selected on the basis of the opening date.
The opening balance is a summary of your past transactions. It’s kept as a reference point because it’s the only one that is already reconciled when you start recording your data. Add Closing & Opening Information into my QuickBooks Account Every other transaction must be reconciled later after cross checking it with the transactions mentioned on the bank statement.
Steps to Add Closing and Opening Balances in QuickBooks Account
Let’s start off with creating the appropriate type of account. QuickBooks enables you to select between two options: bank or credit card. Both these options offer somewhat different functionalities, so it’s essential to choose wisely at this point.
Here are the steps for entering an opening balance in QuickBooks Desktop:
1. Sign into your bank’s website or get a hold of your latest bank statement.
2. Launch QuickBooks Desktop.
3. Select Company and click on Chart of Accounts.
4. Right click in the chart of accounts window and select New.
5. Choose between:
B. Credit Card
6. Click on Continue.
7. Enter the required details such as name of the account and other necessary details.
8. Click on Enter Opening Balance.
9. Now you must enter the opening balance, but you need to decide the basis on which you’ll enter the past transactions and opening balance.
A. Not to Enter older transactions with opening balance: if you want to simply add the opening balance without the transactions that were created before the end of previous financial year. This opening balance works as a summary of all the previous recorded transactions.
B. Past transactions in detail: Entering past transactions can always be helpful in creating reports and understanding trends. I always recommend that you retain the financial data of at least the past 2 years so that you can easily analyze data and cross check transactions.
i. Pick up a date before the opening transaction till which you want to import the transactions.
ii. Enter this date as the Ending date.
iii. Enter the balance of the real bank account as of the ending date that you selected in the previous step.
iv Click on Ok.
10. Click on Save and Close.
The opening balance has successfully been recorded. As you can see from the steps above, QuickBooks desktop makes it easier to record data and start a new account in your books. Opening and ending balances can be used to add either a summary of the previous year’s transactions or all transactions for a specific date range.
How to Handle Outstanding Payments When Adding an Opening Balance?
If you want to enter outstanding payments when entering the opening balance, you don’t have to worry, Add Closing & Opening Information into my QuickBooks Account as QuickBooks has some pretty handy features that’ll help you in dealing with these problems.
Here are the steps for the same:
- Go to your bank’s website.
- Download the bank statement after signing into your online bank account.
- Launch QuickBooks Desktop.
- Click on Company option in the main menu.
- Select Charts of Accounts.
- Right click on the Account, and select Edit.
- Click on Change Opening Balance.
- Click on Record after verifying the information.
Other Account Types – Balance Sheet Accounts in QuickBooks
When you want to enter opening balances for the accounts in your balance sheet, you need to be careful. Here are a few Balance Sheet accounts that you may want to add opening balances for:
➤ Fixed Asset account
➤ Long-term Liability account
➤ Current Asset account
➤ Other Current Asset accounts
➤ Other Current Liability accounts
Here are the Steps to Add Opening Balance for Balance Sheet Accounts in QuickBooks Desktop
- Download your Bank Statement from your bank’s website.
- Launch QuickBooks Desktop and go to the Company menu.
- Click on Chart of Accounts from the provided option.
- Click on New after right clicking on any blank space in the Chart of Accounts window.
- Select one of the account types.
- Click on Continue.
- Input a descriptive name for the account. Always add unique names to your bank accounts. Enter all the required details.
- Choose Enter Opening Balance and select on the basis of which you want to enter the balances:
A. Want to enter older transactions
B. Want to enter past transactions in detail
As you can see, we’ve mentioned the steps for Add Closing & Opening Information into my QuickBooks Account. You can add the balances for both real life bank accounts and accounts in QuickBooks. This makes it easier to record all your transactions and reconcile your books later.
Note:Still struggling with adding opening and closing balances in QuickBooks Desktop or online? Get in touch with our experts now via live chat or call.
Frequently Asked Questions
Where Can I Check all of the Opening Balances for all my Bank Accounts?
Ans. In QuickBooks desktop, you have an Opening Balance Equity account, which tracks all the opening balances of all the different bank accounts. You can use this account to not only track but also manage multiple bank accounts at once.
Can I use a Journal Entry for Creating the Opening Balance for an Account in QuickBooks?
Ans. Yes, you can. In fact, this is the manual method of entering an opening balance in any account. QuickBooks simply has multiple tools that help you to easily enter the opening balances with prior transactions. Add Closing & Opening Information into my QuickBooks Account, you have more flexibility when you add an opening balance using QuickBooks Desktop.
Can I Check the Opening Balance Entry in QuickBooks?
Ans. Yes, you can. In fact, opening balance entries are present in each account you create and want to reconcile. Without an opening entry, Add Closing & Opening Information into my QuickBooks Account it would be almost impossible for you to reconcile your books. And the opening balance is the only transaction that is automatically reconciled. Rest of the transactions must not be marked as reconciled before you start with the reconciliation report.