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System Accounts

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Ryan D.

23 Apr, 2013 08:11 PM

Hi Mathew & Karen,

Would like to know what happens in this software to the "Retained Profits" Account when one reconciles the year ending accounts. Are there any changes that happen to this account?

Should drawings from capital (like say non tax deductible expenses, personal expenses or Income Tax payable) be deducted from the P&L or Retained Profit Account? How do these two accounts differ in Easy Books?

Tried asking my accountant, who was not familiar with the working of this software and hope you can help.

Thanks yet again.
Ryan.

1. Support Staff 1 Posted by Admin on 24 Apr, 2013 03:12 PM

   

   Hi Ryan,

   No changes are made to the retained profits. You can transfer money from your Profit & Loss account into it if you like. There isn't a requirement to do so: it's up to you.

   Easy Books uses the Profit & Loss account to consolidate your year, moving your overall profit into the account. Typically you'll have tax to pay, see http://easybooksapp.com/corporation-tax.

   Mathew

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2. 2 Posted by Dr. Ryan DSouza on 24 Apr, 2013 04:28 PM

   

   Thank you for the reply Mathew. So as I understand, if I create all my entries in the P&L account including all drawings and non deductible expenses, then I would not really need to use the "Retained Profits" account. Am I right?

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3. Support Staff 3 Posted by Admin on 25 Apr, 2013 08:46 PM

   

   Yes

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4. 4 Posted by Ryan D. on 26 Apr, 2013 04:13 AM

   

   Thank you.

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5. Admin closed this discussion on 27 Apr, 2013 07:33 AM.