web
You’re offline. This is a read only version of the page.
close
Skip to main content

Notifications

Announcements

No record found.

News and Announcements icon
Community site session details

Community site session details

Session Id :
Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / Retained Earnings in GP
Microsoft Dynamics GP (Archived)

Retained Earnings in GP

(0) ShareShare
ReportReport
Posted on by Allen Black 500

I have a newbie question about retained earnings accounts in Dynamics GP. Is a new retained earnings account created each year, or does a retained earnings account simply get "zeroed-out" upon closing?

*This post is locked for comments

I have the same question (0)
  • K Day Profile Picture
    K Day 7,365 on at

     The retained earnings account is typically the same account every year.  It is a Balance Sheet account and is in the Owners equity section of the balance sheet.  Closing the year will sum up the balances in all of your Profit and Loss Accounts and create a journal entry to zero out the Profit and Loss accounts and offset that by posting that to the Retained Earnings Account.

    So to simplify, lets say I have 2 P&L Accounts total on my books.  Sales and Expenses.  Throughout the year I had sales of $1,000 and expenses of $500.  I made a profit of $500.00 this year.  When I close the books, there will be a credit to Expenses for 500.00 (to zero it out because expenses will have a debit balance), a debit to Sales for 1,000 (to zero it out because Sales is a credit balance) and then a credit to Retained Earnings for 500.00

    If this scenario went on exactly the same, after year 3 you would have a credit balance in Retained Earnings of 1,500.  Credit Balance for Owners Equity is good (debit balance means you are losing money)

  • Allen Black Profile Picture
    Allen Black 500 on at

    Thank you K Day. That is precisely what I needed to know.

Under review

Thank you for your reply! To ensure a great experience for everyone, your content is awaiting approval by our Community Managers. Please check back later.

Helpful resources

Quick Links

Responsible AI policies

As AI tools become more common, we’re introducing a Responsible AI Use…

Neeraj Kumar – Community Spotlight

We are honored to recognize Neeraj Kumar as our Community Spotlight honoree for…

Congratulations to the November Top 10 Community Leaders!

These are the community rock stars!

Leaderboard > 🔒一 Microsoft Dynamics GP (Archived)

#1
mtabor Profile Picture

mtabor 1

Last 30 days Overall leaderboard

Featured topics

Product updates

Dynamics 365 release plans