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New to microsoft money package RRS feed

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  • Hey, I just joined a new organisation that is using the microsoft money for its transactions and i am trying to find out what is this "unresolved equity" that appears in RED under the Equity heading on the balance sheet. What does it really mean?
    Monday, December 19, 2011 9:24 AM

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  • As I understand it, Total Assets =(Total Liabilities + Equity). That is the fundamental accounting equation. That equation can also be written as Equity =(Assets – Liabilities).

    So you have not entered equity items that make the equation work, so Money represents the unresolved part as unresolved equity. So you have more liabilities than you have assets. Since that make the unresolved equity negative, Money shows it in red.

    I don't use the Business version of Money. I don't know what would be appropriate to enter to match the fundamental equation and thereby resolve the the Equity. I don't know if there would be any reason to bother.

     




    Monday, December 19, 2011 5:26 PM
    Moderator
  • Cal,

    That was the clearest explanation I've ever heard of "Unresolved Equity" which always had me puzzled too.   Thank you!!  In my case, you triggered some thoughts and I was able to clean up my books by replacing all of the transfers of money to the business (using my personal checks and credit cards) to get it started - with Owner's Transfer (draws and contributions) which you'll find under Business > Resources > Owner's Transfer.  

    tau86,

    After every business transaction is cleaned up with no mix of personal categories and accounts, Unresolved Equity will no longer appear in the Balance Sheet.  My Equity categories are now: Draws, Contributions, Net Income and Retained Earnings.



    • Edited by ameridan Wednesday, December 21, 2011 2:57 AM
    Tuesday, December 20, 2011 10:30 PM
  • Thanks ameridan,

      Your tips helped me clear up my un-resolved equities. It definitely had to do with opening balances in accounts. Instead of entering a value in the opening balance of each account, my first entry now is a deposit in the amount of the opening balance, then I assign the deposit to an income category. That cleared it up. The date of the first entry is before my first reporting period so the deposit categorized as "income" doesn't show up as income for the fiscal period of interest. 

      The other thing I did was designate every category as a business category (rather than a personal one). I don't know if this makes a difference. I also assigned everything to show up on the Schedule C report for consistency. I don't know if this makes a difference. I'm in Canada and Money is setup for the USA tax system so I can just ignore Schedule C.

     I'm down to the last $6.87 in unresolved equity to sort out. Almost there.

      The only reason I'm using MS Money Sunset Business is to set up a dummy account I called "restricted cash". I manually enter amounts with restricted use and include this account in the balance statement but not the cash flow statement. It's a bit of a fudge, but it's the only way I can find in Money to show Reserves or restricted cash on the balance sheet without exporting to Excel and setting up the reports manually. 





    • Edited by tony.money Monday, October 1, 2012 6:32 PM for clarity
    Monday, October 1, 2012 6:28 PM