Bookkeeping › Books of Prime Entry
How do you record opening entries when starting a new set of books?
AdvancedAnswer
Opening entries record the assets, liabilities, and capital at the start of the business or period, usually via the journal. Debit the opening assets and credit the opening liabilities and capital; the capital is the balancing figure (Assets - Liabilities). This establishes the opening position in the ledgers.
Assets 15,000, Liabilities 5,000: Dr Assets 15,000; Cr Liabilities 5,000; Cr Capital 10,000.Real-world example A new business journalizes its starting assets and liabilities, with capital as the balancing figure.