new year

[Katie Eldridge]

Michael,
It's not a problem for me with Gnucash - I was just explaining why for 
me the 'close the books' function works!  I use the 'close the books' 
tool, have an equity account named 'taxed profits' to move the balance 
into.  Then I immediately take the tax from there to the 'corporation 
tax' liability account until it's due to be paid.  All the dividends are 
taken from this equity account, so when it has a positive balance I'm 
taking dividends out of already taxed earnings, and when it is a 
negative amount I'm dealing with this year's earnings and know I need to 
allow for tax.
Katie

On 11/11/15 03:10, Mike or Penny Novack wrote:
> On 11/10/2015 5:13 PM, Katie Eldridge wrote:
>>
>> Wm,
>> I'm fairly sure I can't get the numbers I need without closing the 
>> books...  It's not for reporting purposes - I can do all the balance 
>> sheets, income&expenditure and equity statements no problem using the 
>> reports, as you can change the accounting period for that.  Its 
>> keeping track for dividends purposes... The dividends come out of 
>> profit after making allowances for tax liabilities.  The previous 
>> year's profit has had tax taken out already, so that is an amount 
>> that can be used as dividends when current assets allow, whereas the 
>> current year's profits I need to ensure that the dividend amount 
>> makes allowance for the tax liability on those profits.  Also, I 
>> needed to close out the income/expense amounts into an equity account 
>> in order to take the corporation tax liability out of it, as it's not 
>> an 'expense'.
>> Does that make sense, or am I completely misunderstanding?
>> Katie 
>
>
> Makes perfect sense to me, Katie. But let me ask a question. Do you 
> know how you would  be doing those transactions (needed for corporate 
> accounting) were you keeping the books the old fashioned way, pen and 
> ink on paper? What I am saying here is that I think your problem is 
> less with gnucash than the fundamentals of "accounting for a 
> corporation".
>
> In other words, you have a lot more steps to do than a simple "close 
> the books" and may not be able to use the built in facility. But all 
> that means is that you construct the transactions you need. Refer to 
> your "accounting 101" text for what those should be (for a corporation).
>
> Michael
>
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