Your beginning balances are the trial balances from your previous accounting software—the ending debit and credit balances.
After you've entered the beginning balances and verified that the information is correct, the balances must be locked.
You cannot unlock balances after they've been locked. But, if you've locked and need to enter balances for any new accounts, create a journal entry to include them.
Realm will display your remaining bank balance whenever you select a checking account while entering transactions, pay invoices, and more. You can always keep an eye on it as you work.
Enter Beginning Balances
Enter the bank balance you start with.
- Click .
- Select the month and year on which you're documenting your current balances.Note: Your beginning balances will post to the last day of the month before the one you select. These balances will carry over into the selected month.
- Enter the account segments of the accounts containing your current balances.
- Enter the beginning balance under either the Debit or Credit field.
- Click Add.
- Select an As of: month and year to the period in which your beginning balance transaction will post.
- Once the Debit and Credit columns balance, and you have verified that the information is correct, click Lock Balances.
Manage Beginning Balances
As long as your balances have not been locked you can edit beginning balances.
- Click .
- Optional: Click the drop-down beside Showing: to select one fund to view at a time.
- Click beside a balance and select one of the following:
- If you edit, make any necessary changes, and click Save.
Debits and Credits
Here are some debit and credit definitions and examples.
Debits and credits track the increases and decreases in your accounts. In double-entry bookkeeping, each transaction is entered as a debit in one account and as a credit in another account.
In some cases, a transaction may have debits and credits across several accounts. However, the sum of all debits and credits must equal. Which accounts are increased and decreased with a debit or a credit depends on the type of account. The one constant is that debits are on the left side of a transaction and credits are on the right side of a transaction.
As illustrated below, the sum of debits and credits should equal in each general ledger fund.
The Accounting Equation
When you look at the accounting equation, keep in mind that revenues and expenses are temporary accounts that close into the net asset accounts (equity) at the end of the year. Therefore, revenues and expenses are considered part of the net assets (equity) section of the equation.
Assets = Liabilities + Net Assets(Equity)
The water bill in the amount of $150 comes in, and you pay the bill from the church's checking account. In this case, your expense account for utilities would increase, and your asset account for the church's checking account would decrease. Your transaction would look like this:
|Church Utilities (Expense)||+$150|
|Operating Checking (Asset)||-$150|
The church receives $500 in contributions for general tithes and offerings, and you deposit this into the church's checking account. The revenue account for tithes and offerings would increase. The asset account for the church's checking account would also increase. Your transaction would look like this:
|Tithes and Offerings (Revenue)||+$500|
|Operating Checking (Asset)||+$500|