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How do I enter an investors reimbursements?

I have a client who has one investor who is helping fund a big project. Generally, my client will pay for the materials and labor ahead of time and then submit an invoice/report to the investor, who will then cut a check for that amount, thereby reimbursing my client. I am not sure how I should record this. The bookkeeper before me does not have an account set up for the investor, nor did they set up any kind of reimbursement account. Should I create an investor account AND set up a second reimbursement account (my client will have reimbursements to a partner company that pays for labor and materials themselves, but will submit a reimbursement request at the end of the month). TIA

1 Comment
QuickBooks Team

Re: How do I enter an investors reimbursements?

Hello cnwchris,

 

Thank you for posting here in the Community. I'm here to help you any questions you may have concerning entering an investor's reimbursements in QuickBooks Desktop.

 

You can use the Journal Entry feature to record the business expense paid by your client for the materials and labor. 

 

Here's how:

 

  1. Click the Accountant tab at the top menu bar.
  2. Click Make General Journal Entries.
  3. Choose a date range.
  4. Below the Account column, choose an Expense account for the purchase.
  5. Enter the amount of the purchase in the Debit column.
  6. On the second line, in the Account column, enter a Partner Equity account.
  7. In the Credit column, enter the amount of the purchase.
  8. (Optional) In the Memo field, add a note to help identify the transaction later (example: Reimbursable).
  9. Click Save & Close.

Here's a screenshot for your visual reference:

 

 

Once done, you can now create a check to reimburse the owner for the expenses.

 

You can follow these steps:

 

  1. Click the Banking tab at the top menu bar.
  2. Click Write Checks.
  3. Select the Bank Account you are reimbursing from (you can also use petty cash).
  4. (optional) Next to Pay to the Order of, add the investor as a vendor.
  5. Go to the Expenses tab.
  6. In the Account column, select Partner's Equity.
  7. Enter the amount of the reimbursement.
  8. Select Save and close.

For additional insight into creating checks, I'm adding an article that I recommend:

 

Create, modify, and print checks.

 

If you need more help on which accounts to use, you can also reach out to an accountant for expert advice. 

 

Please keep in touch with me here should you need any further assistance creating the reimbursements,. The Community always has your back.