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wymcotax
Level 1

Personal grocery on S-corp credit card - Entry

I wondering if anyone could help me with this: the owner used an S corp card to pay for some groceries by mistake. The person who was working on the book classified it as Owner's Pay & Personal Expense (an Equity account)...On the balance sheet, the amounts are negative there. I am trying to clean it up a bit, by reducing the Owner's investment account (an equity), but would like some confirmation about which account to debit or credit.

 

Any assistance would be appreciated;

Thanks

1 Comment
Teri
Level 9

Personal grocery on S-corp credit card - Entry

Owner's Pay & Personal Expense (Equity account) should never be used by an S Corp shareholder (owner). Personal expenses should be coded to equity account called Shareholder Distributions (debit balance acct).

 


@wymcotax wrote:

I wondering if anyone could help me with this: the owner used an S corp card to pay for some groceries by mistake. The person who was working on the book classified it as Owner's Pay & Personal Expense (an Equity account)...On the balance sheet, the amounts are negative there. I am trying to clean it up a bit, by reducing the Owner's investment account (an equity), but would like some confirmation about which account to debit or credit.

 

Any assistance would be appreciated;

Thanks


 

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