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ohio_coffee
Level 2

Am I using "Payment Account" correctly for owner's investments?

Hi all!

 

Let's say I spend $100 of my personal funds to buy something for my business. I'd create an expense, categorize that purchase and then enter an Owner's Investment entry of -$100.

 

I'm not sure I'm using "Payment account" correctly? (It's the dropdown on the top next to Payee)

 

Currently I'm using a bank account called "Owner's Payment Account" (this could be my personal bank or my credit card or my cash). 

 

Is that the best way to do this?

 

Thanks!

Bryce

2 Comments 2
Rustler
Level 15

Am I using "Payment Account" correctly for owner's investments?

The easiest way is to use a zero dollar expense. Line one: list the expense account and amount
Line two: list the owner equity investment account and the same amount as a negative, save

 

No owner investment is never a negative number.

 

If you want to use an owner payment account, a cash type bank account you create in the chart of accounts, then:
1. make a deposit in the account and use owner equity investment as the source account for the deposit
2. pay for the expense from the owner payment account

 

ohio_coffee
Level 2

Am I using "Payment Account" correctly for owner's investments?

Thanks for the quick response!

 

The zero dollar expense is what I've been doing and is what I'd prefer to do.

 

Also using an owner payment account feels like it's creating a redundancy. 

 

Do I have to do both? Since I can't save the transaction without putting something in the Payment Account field it seems like I have to. What account should I put in there?

 

 

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