Owner Mistakenly Paid Bill With Personal Funds NSF

You're correct that you can generate journal entries (JE) for these transactions in QuickBooks Desktop (QBDT), @tramach. I'd be delighted to lay them out below.

Beforehand, please make the necessary changes to the JE you've incorrectly created. Then, proceed to create a JE that directly affects your credit card (CC) account. Here's how:

1. Go to the Company menu and select Make General Journal Entries.
2. On the first line, select the company CC account or choose A/P if you have an outstanding bill and enter the vendor's name.
3. Enter the amount in the Debits column.
4. On the second line, choose Partner's equity or Owner's equity.
5. Enter the same amount in the Credits column.
   
   
6. Select Save & Close.

After that, pay the bill using the vendor credit from the journal entry by clicking on Set Credits. For more details, see the article: Pay for business expenses with personal funds. (Though this article is for QuickBooks Online, the same principle applies to QBDT.)

Since the payment was returned, you can simply create another JE entry in reverse. Instead of selecting the company CC account in the first line (Debits column), choose Partner's Equity or Owner's Equity. Then, select the company CC in the second line (Credits column).

Nonetheless, I highly recommend reaching out to your accountant for additional guidance or questions regarding recording these entries. They can also provide alternative methods and share accounting perspectives within the program.

Regarding your additional query, yes, you can simply write checks to record an early payment to your CC account since you don't want to post it to A/P. Just ensure that you select the CC account in the Account▼ dropdown from the Expenses tab. You can visit the Pay credit card charges before reconciliation section in this article for the exact steps of the process: Set up, use, and pay credit card accounts.

Additionally, check out this article to learn more about managing your income or expenses effectively and resolving any possible errors: Learn the reconcile workflow in QuickBooks.

Please don't hesitate if you have other questions or concerns about business expenses in QBDT. I'll be glad to assist you again. Take care and more power to your business!

I think the step I was missing was to set the credits on the bills.

Since the bill existed in QB it was already in AP. I made a journal entry debiting AP, and crediting member's equity. Then I made another one that was the reverse. I then went into Pay Bills, and set the credits and made the payment. I think it's correct now.

Thanks for following up with the Community, tramach.

I'm happy to hear you were able to figure it out. If you need to check if things are correct or not, I'd recommend working with an accounting professional.

If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

I've also included a detailed resource about working with journal entries which may come in handy moving forward: Create a journal entry

Please feel welcome to send a reply here or create a new thread if there's ever any questions. Have an awesome Wednesday!