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Start-Up Costs as Owner Investment/Drawing

T_NewBusinessT_NewBusiness Member Posts: 2

Hi there,

Quick question regarding expenses paid out of pocket. The only expenses incurred by our business in 2020 were paid out of pocket. I listed all of these expenses in the owner investment/drawing account type. When I run our balance sheet to prepare our taxes I noticed theses expenses show under equity. Is this correct? or should these expenses show as liabilities?

Thank you for any help you can provide!

edited March 23, 2021 in Accounting Technical Support

Comments

  • AlexLAlexL Member Posts: 2,869 ✭✭✭

    Hi @T_NewBusiness , Owner Investment/Drawing will always show under Equity, although I'm afraid that I can't advise you on whether or not the selection of this account is correct. I would recommend reaching out to an accountant or CPA and if they do agree that the Owner Investment/Drawing flow is correct, then it should indeed be showing up under Equity.

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