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Chapter 16. Recording Owners' Equity > Understanding the Opening Balance Equity...

Understanding the Opening Balance Equity Account

Say, for example, that you enter an opening balance of $5,000 when you set up your cash account. QuickBooks puts $5,000 into your cash account, but it doesn't know where the offset of that $5,000 should go, so off it goes to the opening balance equity account.

Examine the Opening Balance Equity Account

View the contents of your opening balance equity account by pressing Ctrl+A to open your Chart of Accounts.

Scroll down until you see the opening balance equity account.

Click the account name.

Click the Reports button.

Select QuickReport Opening Bal Equity, or press Ctrl+Q.

Examine the report to determine in which accounts these amounts really belong. Typically, the amounts in the opening balance equity account belong in your company's retained earnings or other ownership equity account.

Double-click any entry on the report to see the source of the entry.


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