Don’t open a new file. Manager maintains all the old records in the same file. One of it’s nice features is that you don’t need to go through the classic closing operations of creating income summaries, making closing journal entries, etc. Simply click on the Customize button on the summary page. Then change the from date to the beginning of the new accounting year. Summary will now display the “temporary” or income statement accounts as though you had closed them and started fresh.
You may wish to make journal entries to close Expense Claims, Drawing, or similar accounts to owner’s equity or capital accounts (depending on how you’ve set up your chart of accounts).
I find I don’t even need a drawing account for my sole proprietorship. I just make transfers directly to owner’s equity.
My year-end closeout literally included three steps:
- Resetting the from date for the Summary display.
- Closing Expense Claims to owner’s equity so that accounts reflects what I still have invested in the business.
- Closing Retained Earnings to owner’s equity. This resets the Retained Earnings balance to zero. For the rest of the accounting period, that default account operates like an Income Summary account would during normal closing operations.
I hope that helps.