21st Century Accounting Help - General Ledger

Historical Balances

When you convert a set of existing books to 21st Century Accounting, use General Ledger/Configure/Historical Balances to enter balances for general ledger accounts. If you don't want to keep historical account data, simply enter the fiscal year-to-date balances for the last closed G/L period from your previous books. The system uses these balances as the balance forward amounts (beginning balances) for the first 21ts Century Accounting G/L period.

You may choose to keep track of account activity from previous years for budgeting, forecasting, or comparative purposes. If you want to set up comparative financial reports using periods from previous years, you must enter the period activity for each period for each account that you want to include in the comparisons.

Start your year of historical activity by entering the year-to-date balance for the period immediately preceding the first period in the historical year. Then enter period activity for each historical period in the year.

Watch the Signs

Enter the "normal" period activity amounts for debit balance accounts (assets and expenses) as positive amounts and the "normal" period activity amounts for credit balance accounts (liabilities, owner's equity, and revenues) as negative amounts (with minus signs).

Remember that depreciation, amortization, purchase discounts, and sales discount accounts can be contra accounts. Contra account historical period activity should be entered with the opposite sign from the normal balances for account type. For example, enter the period activity for depreciation and amortization contra accounts as negative amounts, although they are asset (normally positive-entry) accounts. Enter activity for a sales discount contra account as a positive amount, although it is a revenue (normally negative-entry) account.

You must also keep in mind that an account can have something other than its normal period activity. For example, your bank charges account is an expense account and normally has a positive balance. If the bank made an error, say in a prior period, you would reduce this expense, which could result in negative activity for the historical period you are entering.