Hi,
I just want to know, is there any way to transfer my Net Profit into Capital a/c?
i just tried from Journal but Profit and Loss a/c is not visible there…
please let me know if there is any other way.
Thanks & Very Best Regards
Why would you want to do that?
Net profit is already a part of Equity as Retaned Earnings including (Initial) Capital.
Depending upon your use-case, you probably want to move cash around from your cash accounts.
Keep in mind that in the double entry system, anything on the right side (liabilities and equity) is not that significant when compared to left side (assets) because at the end of the day, what you have probably got is cash (or other liquid assets).
Cash is the king in almost all businesses!
Retained Earnings is the Net Profit. Just a Different Term.
@Umerbutt Read the Guides. Guides | Manager
Manager Accounting is improving towards Journal Entry ‘Hassle Free’ accounting program.
To clarify a little bit, @UmerButt, net profit is not an account. It is the difference, for the current reporting period you have set, between income and expenses. Retained earnings is different. That is the net of all income, expenditures, contributed funds, dividends, drawings, and so forth, since inception of the company.
Depending on actions you have taken previously, the two may or may not be equal. To transfer from Retained earnings to capital accounts, use a journal entry.
Its because i want to share/divide the profit in two different Partners/capital accounts
so i came to this idea
if there is another easy or reliable way
Very Best Regards
it Helped a lot
Best Regards 