Why adjust uncategorized income and expenses?
When you enter unpaid balances for customers and vendors when you set up
your company, QuickBooks assigns the balance to accounts called Uncategorized
Income and Uncategorized Expenses, respectively. entering historical data, Uncategorized Expense account, Uncategorized Income account, . If you keep your books on an
accrual basis, you
probably should make an adjustment so that all the income and expenses from
before your start date are treated the same as income and expenses after the
start date, regardless of whether payment has occurred.
The procedures in this topic set the amounts for Uncategorized Income and
Uncategorized Expenses to zero. entering historical data, Uncategorized Expense account, Uncategorized Income account, . After that you need to enter adjustments as
described in Adjust income and
expense amounts if your start date is not at the end of your fiscal
year.
To adjust for uncategorized income
Go to the Lists menu and click Chart
of Accounts. entering historical data, Uncategorized Expense account, Uncategorized Income account, . 
Select the income account called Uncategorized Income.
Click Reports at the bottom of the list and click
QuickReport.
If the report doesn't list any amounts, change the Dates
field to All.
Write down the total amount for all the customer opening balance transactions. entering historical data, Uncategorized Expense account, Uncategorized Income account, .
(You may have to scroll to the bottom of the report.)
Return to the Chart of Accounts window and select
the equity account called Opening Bal Equity.
Click Activities at the bottom of the list and
click Use Register.
In the empty transaction at the bottom of the register, enter a transaction.
Enter your start date.
Click the Account drop-down arrow and then
click Uncategorized Income.
In the Increase field, enter the total amount
from the Uncategorized Income QuickReport.
Click Record to record the transaction.
To adjust for uncategorized expenses
Go to the Lists menu and click Chart
of Accounts. entering historical data, Uncategorized Expense account, Uncategorized Income account, .
Select the expense account called Uncategorized Expenses.
Click Reports at the bottom of the list and click
QuickReport.
If the report doesn't list any amounts, change the Dates
field to All.
Write down the total amount for all the vendor opening balance transactions. entering historical data, Uncategorized Expense account, Uncategorized Income account, .
(You may have to scroll to the bottom of the report.)
Return to the Chart of Accounts window and select
the equity account called Opening Bal Equity.
Click Activities at the bottom of the list and
click Use Register.
In the empty transaction at the bottom of the register, enter a transaction.
Enter your start date.
Click the Account drop-down arrow and choose
Uncategorized Expenses.
In the Decrease field, enter the total amount
from the Uncategorized Expenses QuickReport.
Click Record to record the transaction.
See also