Your Wave account always defaults with a personal account. This is where any personal transactions should appear. Your personal Visa card should not technically be hooked up to your business.
This article mostly speaks to whether you make a personal expense with your business Visa card.
If you do make a personal expense on your business Visa mark it as Personal > Owners investment drawing
I’m confused and thinking I may need to do a journal entry. I run a fresh produce business I receive a bill but a portion of that is for personal use eg bill is $300, only $100 is personal how do I record this in your system to allow for proper reporting to tax office at end of fiscal year. I have tried a few different ways but when I produce the profit and loss report it’s not being reflected??
Just want to clarify my understanding towards this thread. Please correct me YES or NO (with corrections if the answer is NO), it will be much appreciated. Thank you
Casestory...
I am using my "BUSINESS BANK ACCOUNT" for both personal and business income/spending
When i signed up WAVE, i have "PERSONAL account" created automatically. Therefore, i created another "BUSINESS account" under the same WAVE USER ID
I do not care much with proper accounting on my "PERSONAL account", but i do care with my "BUSINESS account"
I totally understand that any personal income/expenses that i categorize into Owner Investment/Drawing in my "BUSINESS account" will not shown up at my "PERSONAL account" and i WILL NOT manually created those transactions into "PERSONAL account" as i dont think i need to keep in track my own spending
Question...
If i follow the thread post, and i categorize all my personal income/expenses (either include GST or non GST transaction) into Owner Investment/Drawing inside "BUSINESS account" category.
(1) - Will ANY of the reports (including tax reports) created under "BUSINESS account" also include these personal transactions info (owner investment/drawing as well as tax info)?
Will personal income/expenses that i categorize into owner investment/withdraw under "BUSINESS account" be ADDED into my business expenses/incomes, which in the end effecting the profit and los statement?
(2) If it does, how do i separate those information, in order for me to get reports JUST on my business activities WITHOUT any info on personal transactions?
Can someone please respond to my query below? It's been almost a month.
Recommendation: video tutorial would be useful instead of an endless and confusing string of conflicting advice and instructions. The info about use of Owner Equity and Shareholder Loan is inconsistent in this forum, while it's clear that distinguishing between how to manage personal transactions by corporations vs SP/Partnerships would be hugely useful to many members here. Your members are having trouble PIECING TOGETHER the fragmented posts with instructions on how to handle business transactions with personal bank accounts.
The presence of the Personal profile is confusing too. What's the point of it since it doesn't communicate in any way with the business profiles? A tutorial on WHY the Personal profile is useful would be a good idea, and when to use it and when not to bother. Its presence implies that it should be used. Right now, however, I fail to see the value, given the ridiculous amount of time it takes to manually reproduce transactions from personal accounts on the Shareholder Loan or Equity accounts on the business side.
Why not just import transactions from personal accounts in the business profile and bulk edit them to the appropriate Shareholder Loan or Equity account?
And hence, back to may original query below: What is the best way to do this so I can save 2-3 hours per week on doing accounting work that used to be completely automated and, through the mysterious recent upgrade, "improved" in a way that kills half a day per week for me now?
Help please.
@Canaczech said:
I'm confused about what "Account" to use when accounting for a business expense paid with personal VISA. My business is a corporation. I occasionally use my personal VISA for business purchases.
I have been importing personal VISA transactions into the Personal profile in Wave to keep personal and business bank and credit accounts separate. After categorizing business expenses made with personal VISA transactions to a Shareholder Loan on the Personal profile, the transactions do not appear on the Business income side. I need to be able to zero-balance the Shareholder Loan by each fiscal year and this method is clearly not working.
I only have business accounts set up on the business side at the moment, and it's not possible to use "Shareholder Loan" as the deposit Account and also as a Category. So, given current set up, I don't know how to get business expenses paid with personal VISA to appear as transactions on the Business Shareholder Loan. Whether it's a journal entry, transaction generated from a receipt or just a new manual income entry made in the Business profile, I still have to assign an "Account" from which the transaction was made (eg. my personal VISA).
So, what do I do?....
(1) Do I download my personal VISA transactions into a Bank account on the Business profile, and assign the personal Bank account as the account for the transaction (eg. Personal VISA), and then categorize it as a Shareholder Loan or an equity account?
(2) Do I need to reconcile all of the personal VISA transactions because it's in the business profile? Or, do I leave only the business-related transactions that I am accounting for?
(3) Will the presence of personal account balances in the business profile affect the company's Retained Earnings totals?
Hey @Beezy , you can split out the expense transaction into two amounts in your Transactions page and categorize the personal amount as Owner Investment/Drawing.
Hi @AussieAussie , these will not be included in your Profit & Loss Report affecting your business balances, which is the reason that this account exists. It omits this from your reports so that these transactions are still existing in your account without having an effect on your balances.
Hi @Canaczech , Barsin responded to your question above if you scroll to the first response on this page. To further this conversation though, we appreciate your feedback on how this can be improved to offer more guidance to our users and I'd be more than happy to pass your ideas along to the team!
In regards to the Personal profile, this is intended to track only Personal transactions. If you have no desire to track Personal transactions, there's no need to use this Profile.
Hi @BarsinA, thank you for your reply. Your answer only partially explains what I need to do. The screenshots are based on the idea that the payment account is "Checking" and it is a personal expense. I assume that the screenshot originates from the Business Profile.
My question is addressing exactly the opposite scenario:
The payment account is "Personal Account" and it is a business expense. I don't want to track my personal expenses in Wave (been using Mint for that for many years), so I am asking how do I record a Personal Account (VISA) as payment account on the Business profile side when the expense category is "Meals & Entertainment", "Travel" or "Phone"? The screenshots suggest that I should import Personal VISA transactions into the Business profile so I can follow your suggested workflow.
If the screenshot is from Personal profile, then I still need to be able to have that info on the business side. So, how do I record the payment account on the Business side when it's a personal account?
Hi @BarsinA, thank you for your reply. I'm sorry, I didn't see it until now. Your reply appears to assume that I will be tracking business expenses made with a personal payment account in the Personal profile. Since the Personal and Business profiles are no longer communicating, I will not spend time tracking personal expenses in Wave. How do I record business expenses paid with personal payment account on the Business side? Example: If I use Personal VISA to pay my business phone bill? What should it look like?
This would be handled by selecting the account type to be an equity account. In Wave this would be considered Money brought into your business by an account separate from the business account.
You can create an equity account called "personal Visa" or something of the sort and categorize your transaction's "account" drop down to this equity account. This will not show as an expense your business has made but rather an outside equity source. You'll then be able to categorize it accordingly!
If you're paying that amount back from your business to your personal, you can simply create an expense transaction from your business checking account and categorize it as a personal > Personal visa. Hope this helps!
HI. I have to agree. I think a video of this issue is much needed. I am reading through all of this and it's very confusing. The bottom line for me is understanding the reports. If choose "Share Equity...." will it ignore the transaction in all my reports. (Which is what I want.) I don't want to delete these transactions...since they may have nothing to do with my business. (For example. I may have accidentally bought groceries on my business account. I later transferred money into my business to make up for it.) You get the idea. PLEASE. make a video instead of having to scroll through these forums. The term "share equity" is confusing for us non-professional accountants. Thank you!
Hey @LIsa_Mia_Studios and welcome to Wave's Community Forum. Because the features in Wave are constantly evolving, having videos that are accurate is extremely difficult to create and maintain. In saying that, we are happy to help through the Community Forum as you have found!
In regards to the "Share Equity" option that you are referencing, can you actually upload a screenshot of where you are seeing this option? I ask because if you are seeing transactions that we for personal use but on a business card, then you shouldn't actually need to choose any of the equity options, as the "Personal" workflow (i.e. categorizing the transaction using the option for "Personal", should streamline the process). In saying that, the screenshot will help us to understand the flow that you are using and provide some guidance. Thanks in advance!
It almost seems easier to just delete non-business transactions from my personal account that I have flow in. I really didn't want to do that.
From my Business wave account, I imported from my bank: my business checking, savings, and also my personal checking account. I have sometimes purchased business items from my personal account every once and a while. So I was trying to exclude all those non-business things from my personal account and not have it count for any of the numbers or reports. Does that make sense?
So figuring out how to declare them that way was what I think we are all looking for in this forum. Help!
What would be the best way to account for a business expense paid for with a personal credit card? Hypothetical example, I owe property insurance on a rental that is $1165.00 and I pay it with a personal credit card. How would this look in Wave? The Personal credit card is not linked to my business account in wave, I simply would like to know how to account for it?? Is it frowned on as well? Commingling - breaking the corporate veil??? I have tried to obtain a business credit card but because it is a real estate type business, everybody is telling me I must wait 2 years. For my other Pool Business, I was approved in seconds for a healthy business credit card after being in business for 5 days for crying out loud. Please help! Thank you.
Hey @TODavid69! Great question. Typically, this wouldn't really be the best course of action, no. It's always going to be better-advised to have your business card handle these types of transactions, but it's not totally impossible to deal with. I'd say you might want to just split these types of transactions out within your account, to make sure you know that those had been paid with your personal card. Tracking those transactions properly and independently (say, with their own liability account in your Chart of Accounts) is going to be the best way to make sure that you can recoup your costs eventually and not be out of pocket from your personal card. I hope that makes sense!
I have the same question as others here, should I add a new equity account under Business Owner Contribution and Drawing or a new liability account under Due to You and Other Business Owners? The guidance above references an equity account, but in the program I am instructed that "all personal transactions must flow through a liability account."
Hi. am I understanding right that the ability to transfer transactions between business/personal profiles is no longer a thing. I am quite disappointed that this feature has been removed. It was a big time saver for having multiple business/ bank accounts with in a house hold. It would be handy even if at the least, the equity accounts for all the business showed up in the other business/personal profiles.... cause sometimes family's have lots of businesses and bank accounts
At this present moment it has been removed due to a previous accounting/language layer which was not correct. We are looking at future ways to bring this back into our system (sorry no ETA) however in the meantime this is the current workaround!
Hello - Looking at using Wave so I've been reading the comments. I want to find out if personal transactions can or cannot be recorded as per the note above? (Sophia C. Updated: Friday at 15:33)
Has that ability been removed (BarsinA) or does that comment refer to something else? Thanks
Hi @Floss , thanks for your message. The above comments are referring to our old software system's version of recording personal transactions, which is not available anymore. The new way to record transactions in Wave as personal is to categorize the transaction as Owner's Investment/Drawing!
It's still a little unclear as to whether the Personal expense accounts should correspond with the Business accounts to separate expenses. I am particularly interested in this as regards a Sole Proprietorship. I understand moving it through the Owner's Investment/Drawing as the double-entry. Are we essentially keeping two sets of books?
...and further, if we are keeping two sets should we double the cash accounts to have them connected in both the Personal and the Business sides so that we can import detail in both sides? Then have the offset in Personal also be to Owner's Investment/Drawing?
@BarsinA - Thank for your answer on May 8, 2020 to @Canaczech . It was the answer I needed after reading this long thread.
Follow up question:
After categorizing transactions to the new Equity account ' personal Visa', (as stated it's not an business expense), how do you then create a report to send to your CPA, that shows it as an expense to deduct/include in a business category (say business meal & entertainment, business telephone, etc...)?. That is, how you do you make sure it's included in your Business P/L Statement, List of Transactions, etc for Business reporting to your CPA?
Hi @cjDuggan , thanks for your message! To clarify, yes - this approach encourages keeping separate books, one for business and one for personal. This makes things a bit easier come tax time. If, for example, you want to record that you paid for a personal item with your business card, you would create the expense transaction and categorize it to Owner's Investment/Drawings. Then, on your personal bookkeeping, you would create an income transaction categorized as Owner's Investment/Drawings.
Hi @GlbInv , thanks for getting back! In this case, if a transaction is being marked as personal, it will not appear on your reports as a business expense in order to respect the previous 'personal' categorization.
Why not just use Owners Equity as the account you transfer personal money into and out of? Why do we need Owner's Investment/Drawings and/or Deposit from Personal and Personal Expense or Withdrawal? Also, where is "the transaction detail view"? Are these some kind of "sub-accounts" to Owners Equity? Thanks
You could in theory, however the present method adds a language layer for it being a personal transaction until Wave reinstates a method of physically moving the transaction. They aren't technically sub accounts as Wave does not have sub accounts at this time, it's once again more of the language layer on the transaction side.
As a sole proprietor with a CapitalOne credit card, a comment.
Between this change and Wave's months now of inexcusable failure of its new data processor (Plaid) to support data linking with many major financial institutions, you have destroyed not only the basis of my accounting system, but irretrievably altered years of my past data that was maintained on your own recommended use of a linked Personal account. These changes happened with no notice, zero empathy, and no recourse.
I have no words for the amount of pain and wasted time involved. I cannot imagine treating users this way. Your language about it continues to mask the harm you have done, with words like "Simplified" about this feature, and with wilfully dishonest inclusion of data import interfaces for services you know won't work.
If I borrowed $800 from my personal money to use to buy materials for my business, I am supposed to use the "Owner investment/drawings" right? Then when I take that money back out, to repay my personal checking account, what do I do? I can't find it anywhere!
When you're recording this on your business' side select a new income transaction > Make the account your business checking account (or wherever the funds have landed) > Categorize it as owners investment/drawing. Keep in mind however this is actually money that is put into your business. It's not considered a loan, but more of money your business didn't earn, but did gain from outside equity.
You might actually benefit from creating a loan account? However we as moderators are not accountants so I would either reach out to an accountant about that or you can post in our accounting threads.
Thanks for the input. I did categorize the money coming in as Owners investment. The confusion was in how to deal with taking it back out to repay our personal account. We ended up creating a liability account called loan from owner. I am going to check with my accountant to see if we are doing it right.
That creation of the account sounds like a good idea! I think you could use the same account owner investment/drawing. Essentially, whether it's an income or an expense will determine whether the account balances.
Comments
Hey there @Canaczech
Your Wave account always defaults with a personal account. This is where any personal transactions should appear. Your personal Visa card should not technically be hooked up to your business.
This article mostly speaks to whether you make a personal expense with your business Visa card.
If you do make a personal expense on your business Visa mark it as Personal > Owners investment drawing
Hopefully this helps.
I’m confused and thinking I may need to do a journal entry. I run a fresh produce business I receive a bill but a portion of that is for personal use eg bill is $300, only $100 is personal how do I record this in your system to allow for proper reporting to tax office at end of fiscal year. I have tried a few different ways but when I produce the profit and loss report it’s not being reflected??
Hi,
Thanks for the great software...
Just want to clarify my understanding towards this thread. Please correct me YES or NO (with corrections if the answer is NO), it will be much appreciated. Thank you
Casestory...
Question...
If i follow the thread post, and i categorize all my personal income/expenses (either include GST or non GST transaction) into Owner Investment/Drawing inside "BUSINESS account" category.
(1) - Will ANY of the reports (including tax reports) created under "BUSINESS account" also include these personal transactions info (owner investment/drawing as well as tax info)?
(2) If it does, how do i separate those information, in order for me to get reports JUST on my business activities WITHOUT any info on personal transactions?
Pls kindly advise. Thank you
Can someone please respond to my query below? It's been almost a month.
Recommendation: video tutorial would be useful instead of an endless and confusing string of conflicting advice and instructions. The info about use of Owner Equity and Shareholder Loan is inconsistent in this forum, while it's clear that distinguishing between how to manage personal transactions by corporations vs SP/Partnerships would be hugely useful to many members here. Your members are having trouble PIECING TOGETHER the fragmented posts with instructions on how to handle business transactions with personal bank accounts.
The presence of the Personal profile is confusing too. What's the point of it since it doesn't communicate in any way with the business profiles? A tutorial on WHY the Personal profile is useful would be a good idea, and when to use it and when not to bother. Its presence implies that it should be used. Right now, however, I fail to see the value, given the ridiculous amount of time it takes to manually reproduce transactions from personal accounts on the Shareholder Loan or Equity accounts on the business side.
Why not just import transactions from personal accounts in the business profile and bulk edit them to the appropriate Shareholder Loan or Equity account?
And hence, back to may original query below: What is the best way to do this so I can save 2-3 hours per week on doing accounting work that used to be completely automated and, through the mysterious recent upgrade, "improved" in a way that kills half a day per week for me now?
Help please.
Hey @Beezy , you can split out the expense transaction into two amounts in your Transactions page and categorize the personal amount as Owner Investment/Drawing.
Hi @AussieAussie , these will not be included in your Profit & Loss Report affecting your business balances, which is the reason that this account exists. It omits this from your reports so that these transactions are still existing in your account without having an effect on your balances.
Hi @Canaczech , Barsin responded to your question above if you scroll to the first response on this page. To further this conversation though, we appreciate your feedback on how this can be improved to offer more guidance to our users and I'd be more than happy to pass your ideas along to the team!
In regards to the Personal profile, this is intended to track only Personal transactions. If you have no desire to track Personal transactions, there's no need to use this Profile.
Hi @BarsinA, thank you for your reply. Your answer only partially explains what I need to do. The screenshots are based on the idea that the payment account is "Checking" and it is a personal expense. I assume that the screenshot originates from the Business Profile.
My question is addressing exactly the opposite scenario:
The payment account is "Personal Account" and it is a business expense. I don't want to track my personal expenses in Wave (been using Mint for that for many years), so I am asking how do I record a Personal Account (VISA) as payment account on the Business profile side when the expense category is "Meals & Entertainment", "Travel" or "Phone"? The screenshots suggest that I should import Personal VISA transactions into the Business profile so I can follow your suggested workflow.
If the screenshot is from Personal profile, then I still need to be able to have that info on the business side. So, how do I record the payment account on the Business side when it's a personal account?
Like this?
Hi @BarsinA, thank you for your reply. I'm sorry, I didn't see it until now. Your reply appears to assume that I will be tracking business expenses made with a personal payment account in the Personal profile. Since the Personal and Business profiles are no longer communicating, I will not spend time tracking personal expenses in Wave. How do I record business expenses paid with personal payment account on the Business side? Example: If I use Personal VISA to pay my business phone bill? What should it look like?
Like this?
Hey again @Canaczech
This would be handled by selecting the account type to be an equity account. In Wave this would be considered Money brought into your business by an account separate from the business account.
You can create an equity account called "personal Visa" or something of the sort and categorize your transaction's "account" drop down to this equity account. This will not show as an expense your business has made but rather an outside equity source. You'll then be able to categorize it accordingly!
If you're paying that amount back from your business to your personal, you can simply create an expense transaction from your business checking account and categorize it as a personal > Personal visa. Hope this helps!
HI. I have to agree. I think a video of this issue is much needed. I am reading through all of this and it's very confusing. The bottom line for me is understanding the reports. If choose "Share Equity...." will it ignore the transaction in all my reports. (Which is what I want.) I don't want to delete these transactions...since they may have nothing to do with my business. (For example. I may have accidentally bought groceries on my business account. I later transferred money into my business to make up for it.) You get the idea. PLEASE. make a video instead of having to scroll through these forums. The term "share equity" is confusing for us non-professional accountants. Thank you!
Hey @LIsa_Mia_Studios and welcome to Wave's Community Forum. Because the features in Wave are constantly evolving, having videos that are accurate is extremely difficult to create and maintain. In saying that, we are happy to help through the Community Forum as you have found!
In regards to the "Share Equity" option that you are referencing, can you actually upload a screenshot of where you are seeing this option? I ask because if you are seeing transactions that we for personal use but on a business card, then you shouldn't actually need to choose any of the equity options, as the "Personal" workflow (i.e. categorizing the transaction using the option for "Personal", should streamline the process). In saying that, the screenshot will help us to understand the flow that you are using and provide some guidance. Thanks in advance!
It almost seems easier to just delete non-business transactions from my personal account that I have flow in. I really didn't want to do that.
From my Business wave account, I imported from my bank: my business checking, savings, and also my personal checking account. I have sometimes purchased business items from my personal account every once and a while. So I was trying to exclude all those non-business things from my personal account and not have it count for any of the numbers or reports. Does that make sense?
So figuring out how to declare them that way was what I think we are all looking for in this forum. Help!
What would be the best way to account for a business expense paid for with a personal credit card? Hypothetical example, I owe property insurance on a rental that is $1165.00 and I pay it with a personal credit card. How would this look in Wave? The Personal credit card is not linked to my business account in wave, I simply would like to know how to account for it?? Is it frowned on as well? Commingling - breaking the corporate veil??? I have tried to obtain a business credit card but because it is a real estate type business, everybody is telling me I must wait 2 years. For my other Pool Business, I was approved in seconds for a healthy business credit card after being in business for 5 days for crying out loud. Please help! Thank you.
Hey @TODavid69! Great question. Typically, this wouldn't really be the best course of action, no. It's always going to be better-advised to have your business card handle these types of transactions, but it's not totally impossible to deal with. I'd say you might want to just split these types of transactions out within your account, to make sure you know that those had been paid with your personal card. Tracking those transactions properly and independently (say, with their own liability account in your Chart of Accounts) is going to be the best way to make sure that you can recoup your costs eventually and not be out of pocket from your personal card. I hope that makes sense!
I have the same question as others here, should I add a new equity account under Business Owner Contribution and Drawing or a new liability account under Due to You and Other Business Owners? The guidance above references an equity account, but in the program I am instructed that "all personal transactions must flow through a liability account."
Hi. am I understanding right that the ability to transfer transactions between business/personal profiles is no longer a thing. I am quite disappointed that this feature has been removed. It was a big time saver for having multiple business/ bank accounts with in a house hold. It would be handy even if at the least, the equity accounts for all the business showed up in the other business/personal profiles.... cause sometimes family's have lots of businesses and bank accounts
Hey there @just_me
At this present moment it has been removed due to a previous accounting/language layer which was not correct. We are looking at future ways to bring this back into our system (sorry no ETA) however in the meantime this is the current workaround!
Hello - Looking at using Wave so I've been reading the comments. I want to find out if personal transactions can or cannot be recorded as per the note above? (Sophia C. Updated: Friday at 15:33)
Has that ability been removed (BarsinA) or does that comment refer to something else? Thanks
Hi @Floss , thanks for your message. The above comments are referring to our old software system's version of recording personal transactions, which is not available anymore. The new way to record transactions in Wave as personal is to categorize the transaction as Owner's Investment/Drawing!
It's still a little unclear as to whether the Personal expense accounts should correspond with the Business accounts to separate expenses. I am particularly interested in this as regards a Sole Proprietorship. I understand moving it through the Owner's Investment/Drawing as the double-entry. Are we essentially keeping two sets of books?
...and further, if we are keeping two sets should we double the cash accounts to have them connected in both the Personal and the Business sides so that we can import detail in both sides? Then have the offset in Personal also be to Owner's Investment/Drawing?
@BarsinA - Thank for your answer on May 8, 2020 to @Canaczech . It was the answer I needed after reading this long thread.
Follow up question:
After categorizing transactions to the new Equity account ' personal Visa', (as stated it's not an business expense), how do you then create a report to send to your CPA, that shows it as an expense to deduct/include in a business category (say business meal & entertainment, business telephone, etc...)?. That is, how you do you make sure it's included in your Business P/L Statement, List of Transactions, etc for Business reporting to your CPA?
Thanks!
T@BarsinA To clarify my question, how you do you make sure it's included in your Business P/L Statement, etc for reporting to your CPA? Thanks.
Hi @cjDuggan , thanks for your message! To clarify, yes - this approach encourages keeping separate books, one for business and one for personal. This makes things a bit easier come tax time. If, for example, you want to record that you paid for a personal item with your business card, you would create the expense transaction and categorize it to Owner's Investment/Drawings. Then, on your personal bookkeeping, you would create an income transaction categorized as Owner's Investment/Drawings.
Hi @GlbInv , thanks for getting back! In this case, if a transaction is being marked as personal, it will not appear on your reports as a business expense in order to respect the previous 'personal' categorization.
Why not just use Owners Equity as the account you transfer personal money into and out of? Why do we need Owner's Investment/Drawings and/or Deposit from Personal and Personal Expense or Withdrawal? Also, where is "the transaction detail view"? Are these some kind of "sub-accounts" to Owners Equity? Thanks
Hey there @HonokaaBob
You could in theory, however the present method adds a language layer for it being a personal transaction until Wave reinstates a method of physically moving the transaction. They aren't technically sub accounts as Wave does not have sub accounts at this time, it's once again more of the language layer on the transaction side.
As a sole proprietor with a CapitalOne credit card, a comment.
Between this change and Wave's months now of inexcusable failure of its new data processor (Plaid) to support data linking with many major financial institutions, you have destroyed not only the basis of my accounting system, but irretrievably altered years of my past data that was maintained on your own recommended use of a linked Personal account. These changes happened with no notice, zero empathy, and no recourse.
I have no words for the amount of pain and wasted time involved. I cannot imagine treating users this way. Your language about it continues to mask the harm you have done, with words like "Simplified" about this feature, and with wilfully dishonest inclusion of data import interfaces for services you know won't work.
If I borrowed $800 from my personal money to use to buy materials for my business, I am supposed to use the "Owner investment/drawings" right? Then when I take that money back out, to repay my personal checking account, what do I do? I can't find it anywhere!
Hey there @ShelleysPots
When you're recording this on your business' side select a new income transaction > Make the account your business checking account (or wherever the funds have landed) > Categorize it as owners investment/drawing. Keep in mind however this is actually money that is put into your business. It's not considered a loan, but more of money your business didn't earn, but did gain from outside equity.
You might actually benefit from creating a loan account? However we as moderators are not accountants so I would either reach out to an accountant about that or you can post in our accounting threads.
Thanks for the input. I did categorize the money coming in as Owners investment. The confusion was in how to deal with taking it back out to repay our personal account. We ended up creating a liability account called loan from owner. I am going to check with my accountant to see if we are doing it right.
Hey @ShelleysPots
That creation of the account sounds like a good idea! I think you could use the same account owner investment/drawing. Essentially, whether it's an income or an expense will determine whether the account balances.