Schedule M-2 and Schedule L


M

Mitch

Hope someone can help me out here. I seem to have one number wrong or
misplaced in my Turbo Tax for business. I imported my Quickbooks data
for 2004 and I am getting a strange imbalance on my balance sheet
which I have tracked down to a sibgle number. But I don't know how to
fix it.

My 2002 schedule M2 Line 7 (distributions othet than dividend
distributions) equals $35,692.0 And My 2003 balance sheet is out of
balance by EXACTLY the same amount !! My Assets exceed my Liabilities
and equity by exactly $35,692.0

What am I missing here? How did I screw up? Or did Turbo tax make a
mistake? I doubt that though.

Anyone have any ideas? Thanks in advance.
 
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J

Joanne

Mitch said:
Hope someone can help me out here. I seem to have one number wrong or
misplaced in my Turbo Tax for business. I imported my Quickbooks data
for 2004 and I am getting a strange imbalance on my balance sheet
which I have tracked down to a sibgle number. But I don't know how to
fix it.

My 2002 schedule M2 Line 7 (distributions othet than dividend
distributions) equals $35,692.0 And My 2003 balance sheet is out of
balance by EXACTLY the same amount !! My Assets exceed my Liabilities
and equity by exactly $35,692.0

What am I missing here? How did I screw up? Or did Turbo tax make a
mistake? I doubt that though.

Anyone have any ideas? Thanks in advance.
I'm not using this software for taxes, but mine requires that the
distribution be recorded on the K1 and it then flows to the other
appropriate reconciliations and will result in the retained earnings being
what it should.

--
Sincerely,
Joanne

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A

Allan Martin

Mitch said:
Hope someone can help me out here. I seem to have one number wrong or
misplaced in my Turbo Tax for business. I imported my Quickbooks data
for 2004 and I am getting a strange imbalance on my balance sheet
which I have tracked down to a sibgle number. But I don't know how to
fix it.

My 2002 schedule M2 Line 7 (distributions othet than dividend
distributions) equals $35,692.0 And My 2003 balance sheet is out of
balance by EXACTLY the same amount !! My Assets exceed my Liabilities
and equity by exactly $35,692.0

What am I missing here? How did I screw up? Or did Turbo tax make a
mistake? I doubt that though.

Anyone have any ideas? Thanks in advance.
Did you make the required reclassification of the distribtions to retained
earning/AAA on the first day of the new year.
 
M

Mitch

Allan Martin said:
Did you make the required reclassification of the distribtions to retained
earning/AAA on the first day of the new year.


Allan,

No I didn't do that. My accountant two years ago said I should be
able to do my own taxes with Turbo Tax for business as long as I used
quickbooks. He set up my quickbooks and I have been diligent about
putting deposits and expenses in the accounts he set up.

But I don't know how to make the required reclassification of the
distribtions to retained earning/AAA on the first day of the new year.

It sounds like I need to make a journal entry in Quickbooks? Is that
correct? Can you tell me how to journal the $35,692.00 and from which
accounts?

Your expertise would be much appreciated.
 
A

Allan Martin

Mitch said:
Allan,

No I didn't do that. My accountant two years ago said I should be
able to do my own taxes with Turbo Tax for business as long as I used
quickbooks. He set up my quickbooks and I have been diligent about
putting deposits and expenses in the accounts he set up.

But I don't know how to make the required reclassification of the
distribtions to retained earning/AAA on the first day of the new year.

It sounds like I need to make a journal entry in Quickbooks? Is that
correct? Can you tell me how to journal the $35,692.00 and from which
accounts?

Your expertise would be much appreciated.
If you make distributions during the year then the balance in this equity
account should start out as zero on the first day of any new fiscal year. If
you have a Sub-S corporation then AAA is debited and distributions are
credited. A C-Corp then to retained earnings. This is done by journal entry.

I do not use TT for business so my post is simply and educatated guess that
this is your problem. In any event the balance in the distribution account
should always reflect distributions from the start of the fiscal year to the
current date.
 
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M

Mitch

Allan Martin said:
If you make distributions during the year then the balance in this equity
account should start out as zero on the first day of any new fiscal year. If
you have a Sub-S corporation then AAA is debited and distributions are
credited. A C-Corp then to retained earnings. This is done by journal entry.

I do not use TT for business so my post is simply and educatated guess that
this is your problem. In any event the balance in the distribution account
should always reflect distributions from the start of the fiscal year to the
current date.
Allan,

I got it. Thanks for your help. Now I can see what the accountant
did in my books two years ago. I made the journal entries you
mentioned and my books balance just fine in Turbo Tax. I would not
have figured it out in a million years without your help.

Thank you VERY much for your help. It just goes to show that
engineers like myself should not be doing accounting. LOL

Thanks again for your help.

Regards,

Mitch
 
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