@PatriciaVI did create an historical worksheet for Schedules M-1 and M-2 from the partnership's inception in 2019 through to this tax year 2023, creating ending/beginning Capital Accounts balances. So now Schedules M-1 and M-2 have no errors.
But now Schedule L, Balance Sheets per Books, doesn't balance. It's way off.
Schedule M-2 passes through the ending balance for the Partners' Capital Accounts to Schedule L. Schedule L gets its beginning balance from the Sch K-1 Wks in which I've entered the beginning balance from the historical worksheet.
Frankly, I'm not surprised that Schedule L is out of balance. It's trying to balance the accounting equation using the Partners' Capital Accounts (tax basis) created in Schedule M-2. But those Capital Account (tax basis) amounts bear no relationship to the equity amounts on our corrected Balance Sheets.
Again, we're a simple cash basis company. No capital other than revenues. No property. Our only Assets are cash. Our only Liabilities are nonrecourse credit card balances and Covid loans. The accounting equation is simple: the Equity is simply our cash minus loans. But that simple accounting equation doesn't look anything like the Schedule L because it's trying to balance our Assets and Liabilities using this calculated tax basis Capital Account instead of using Equity.
What am I missing?
