End-Of-Month - New Accounting Period

[stevenwalborn]

Hi all,

I took 2.5 years of accounting which ended about 4-5 years ago, so I'm a little rusty as of right now.

I have a business and am accruing accounts based on a calendar year.
Now with the new year, I am honestly stuck on how to roll the account balances over.
I want to rollover my assets accounts to match what I have on hand. For inventory, I believe i can just do an adjustment to my inventory account in assets and my inventory equity account. I have a purchases account that I use to keep tally of the cost, so the inventory equity is just to adjust for monthly audits of our inventory worth.

I am not sure how I should pullover my cash account though. What do I credit? Obviously my balance sheet needs to, well, balance, so I need some sort of credit for the cash. Should I just create a contra account for roll-over? It's just the assets accounts that really have my scratching my head, because sales, expenses, AP/AR are all 0 at the beginning of the year, but my assets are not. I appreciate any and all help, and please be kind, as I said, it's been a while.

 

[kirby]

Are you working with a manual set of books or an accounting software?

 

[stevenwalborn]

Are you working with a manual set of books or an accounting software?

I am working with a manual set.

 

[stevenwalborn]

I am wondering if I just roll over the balances from month end december 2013 for the account balances at the start of the new year? And then l&p accounts start from scratch.

 

[Counterofbeans]

There isn't really much to do with the asset accounts to roll them over. Whatever the balance was at end of 12/31/13 is the same as the beginning of 1/1/14.

The primary issue when closing the books at year-end is closing all P&L accounts to retained earnings. These accounts should be zero at the beginning of the year (I'm guessing that's 1/1/14 for you).

Does this answer your question?