End Year Close - Revision history

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‎Introduction

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‎Introduction

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‎Introduction

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‎Introduction

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‎Introduction

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 # The "Profit and Loss Closing" entry:
 # The "Closing" entry or "Balance Sheet Closing" entry.
-* This accounting entry resets all "Revenue" and "Expense" Account Types and the difference is posted in the Income Summary account.
+* This accounting entry resets all "Revenue" and "Expense" [[Account Types|Account Types]] and the difference is posted in the [[Income Summary|Income Summary]] account.
 *** In other words the "Expense" accounts are "Credited and the "Revenue" accounts are "Debited" and the difference if any is posted in the Income Summary account. Let's take an expense account with a debit balance of 500,00. The P&L Closing entry creates a credit accounting entry of 500,00 in the Expense account of the example, therefore it gets a balance equal to zero. If the revenue accounts total balance is higher than the expense accounts total balance that difference is credited in the Income Summary account, that means a positive result or a profit.
 If the revenue accounts total balance is lower than the expense accounts total balance that difference is debited in the Income Summary account, that means a negative result or a loss.

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 The close year process requires that the next year exists and its first period is opened.
-Once a year is closed, the status of that year and all its periods can be reviewed in the Open/Close Period Control window.
+Once a year is closed, the status of that year and all its periods can be reviewed in the [[Open/Close Period Control|Open/Close Period Control]] window.
 As already mentioned, all the periods of the year are now shown as "Period Status"="Permanently Closed", that means that it is not possible to post any transaction within that year anymore unless the Undo Close Year process is run for that year.

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 # The "Profit and Loss Closing" entry:
 * This accounting entry resets all "Revenue" and "Expense" Account Types and the difference is posted in the Income Summary account.
 *** In other words the "Expense" accounts are "Credited and the "Revenue" accounts are "Debited" and the difference if any is posted in the Income Summary account. Let's take an expense account with a debit balance of 500,00. The P&L Closing entry creates a credit accounting entry of 500,00 in the Expense account of the example, therefore it gets a balance equal to zero. If the revenue accounts total balance is higher than the expense accounts total balance that difference is credited in the Income Summary account, that means a positive result or a profit.

@@ Line 14: / Line 14: @@
 # The "Profit and Loss Closing" entry:
-** This accounting entry resets all "Revenue" and "Expense" Account Types and the difference is posted in the Income Summary account.
+* This accounting entry resets all "Revenue" and "Expense" Account Types and the difference is posted in the Income Summary account.
 *** In other words the "Expense" accounts are "Credited and the "Revenue" accounts are "Debited" and the difference if any is posted in the Income Summary account. Let's take an expense account with a debit balance of 500,00. The P&L Closing entry creates a credit accounting entry of 500,00 in the Expense account of the example, therefore it gets a balance equal to zero. If the revenue accounts total balance is higher than the expense accounts total balance that difference is credited in the Income Summary account, that means a positive result or a profit.
 If the revenue accounts total balance is lower than the expense accounts total balance that difference is debited in the Income Summary account, that means a negative result or a loss.