Net income wrong on Summary Balance Sheet

Navigator User Forums

Balance Sheets

profile | register | preferences | faq | search

UBBFriend: Email This Page to Someone!

next newest topic | next oldest topic

Author

Topic: Net income wrong on Summary Balance Sheet

FN_User
Member

posted 06-15-2007 02:47 PM

My Balance Sheet Analysis shows in the Equity section:

Trust Activity                    $100,000
Net Worth-Beginning            200,000
Net Income-Current Year        10,000
Changes in Account Balances    5,000
Total Net Worth                 $315,000

Which is correct. But, my Summary Balance Sheet shows:

Trust Activity $100,000
Net Income 215,000
Total Net Worth $315,000

That doesn’t make sense. Shouldn’t Net Income be just $10,000 and not the sum of beginning + current year + changes?

[This message has been edited by fni_support (edited 06-19-2007).]

IP: Logged

fni_support
Moderator

posted 06-15-2007 03:17 PM

Thanks for your question. It is confusing when Net Income seems to mean different things on different reports. There are a number of solutions.

Solution 1

For a partnership, trust, or business, Net Worth-Beginning on the Balance Sheet Analysis is normally zero (and therefore that line does not appear at all). It is zero because at the end of the previous year you allocate that income to the partners or in the case of a trust to an account in Trust Activity. Then the amount that currently appears in Net Worth-Beginning would be included in the Trust Activity portion of the Equity section.

Once you find the errors causing the Changes in Account Balances, that line will be zero and will not appear. See Balance Sheet Analysis - Changes in Account Balances on the User Forum.

Now Net Income on the Summary Balance sheet will be the same as Net Income-Current Year on the Balance Sheet Analysis

If you do not want to allocate income at the end of each year, you can still have balances sheets that make sense:

Solution 2

Change the name "Net Income" to "Net Income -Total." This is the simplest cure. The disadvantage is that the Balance Sheet Analysis line will become "Net Income - Total-Current Year" which is a little confusing.

To change the name, select Accounts | Equity Name Changes.

Solution 3

A better way to present a nice report with undistributed income from prior years is to modify the Balance Sheet Analysis so that it becomes a Summary Balance Sheet. You "collapse" all the asset detail to the Category level but keep the equity detail. The new Summary Balance Sheet will show Net Worth-Beginning separately from Net Income.

To collapse the Balance Sheet Analysis:

Display the Balance Sheet Analysis on the screen. Note that it includes account-level detail.
Select New to return to the Report Selection screen.
Select Report Options.
Uncheck Symbol Subtotals and Accounts-Same Symbol.
Select OK.
Select Screen to display the report. Note that the report no longer displays individual accounts, only Groups and Categories.
Select File | Add New Custom Report.
Enter the name "Summary Balance Sheet".
Select OK.

To print the new report in the future:

Select Summary Balance Sheet from Custom Reports on the Report Select screen. Note there are now two Summary Balance Sheet reports: the normal one at the top of the list and the new one at the bottom. The only reason for saving the new custom report is so that Navigator will remember to name it Summary Balance Sheet. It is still really the Balance Sheet Analysis.
Repeat steps 3-6 above to turn off account-level detail in necessary. Navigator keeps this setting for all balance sheet reports; you need to change it yourself for different reports.
Select Screen to display the report.

- David
FNI Technical Support

[This message has been edited by fni_support (edited 06-15-2007).]

IP: Logged

All times are PT (US)	next newest topic \| next oldest topic
Administrative Options: Close Topic \| Archive/Move \| Delete Topic
	Hop to:

Contact Us | Home

Ultimate Bulletin Board 5.47e