Move items from expenses to balance sheet

Sarahc

Hello,

I've recently spoken to a new accountant. She looked at the income statement generated by Wave and asked if I could move items like "Salary for owner" and "credit card payments" off my operating expenses and into my balance sheet.
Please could someone help me with this.

Thanks
Sarah

Mikeg

Sarahc,
It would be a matter of going back to the original transaction and changing the coding from Salary Owner (expense) to Owner Draw (balance sheet). Same with credit cards. Are you in the US? If you feel your books require some help, I would be available to assist.
Mike G, CPA
www.mgfinancial.net
Better Service - Better Pricing

Sarahc

Hi Mike,

Thank you. Would I need to change the categorisation of investments and salary to assets on the chart of accounts, or would they still fall under expenses just named differently e.g. Owner Draw (balance sheet)

Thanks for your offer ... I'm in South Africa

Take care

Mikeg

Sarah,
I'm not familiar with how items are presented in South Africa. However, you should follow the rules of how items are presented locally. So for example, here in the US a sole proprietor cannot take a salary. They are called draws. So if the owner write themselves a check, then the entry would be Debit owners draw (balance sheet- equity) credit cash (balance sheet-asset). You do not want to change the classification of accounts that is built into Wave. Meaning owners draw belongs on the equity section. I would suggest that your accountant gain access to Wave and have them assist you. It's a simple accounting platform to use. I'd be willing to look at it as well.
Mike G, CPA

Sarahc

Thanks Mike