What Happens When a Year is Closed?
When you close a close a year: 1. You must have all periods closed before a year is closed. 2. There must be no unposted journals for the year that is to be closed. There must be no transactions that have not been updated via subsystem update for the year. 3. When you close, a journal entry is created to writeoff all income statement accounts to retained earnings. 4. When you generate a new year’s trial balance and income statement there will be no ytd income statement amounts.
