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How to Record Cash Withdrawal used for Business Expense

Boss withdrew cash to pay a moving company to move client files from the office to our storage facility. Boss withdrew cash to pay the moving company because there is a discount if paid with cash. How do I record this in Quickbooks? 

Usually when the boss withdraws money, we use the Write Checks window, selecting the Operating account,  payable to Boss's name, and Expense: Account - Capital - Owner's Draw.

Should I also use the write checks window for the operating account, payable to boss's name, but in the Expense - Account tab, choose the appropriate Expense Account such as Outside Services??

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Best answer 12-10-2018

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"can I simply use the write checks function, payable to A...

"can I simply use the write checks function, payable to ATM Withdrawal (vendor name used for cash withdrawals), and select the appropriate expense accounts? If that is not correct, can you please explain why? Thank you so much for your help!"

You are not capturing the Actual, Individual Payments to the Different suppliers of goods and services. Bookkeeping matches Reality.


If the taking of ONE amount as Cash is the ONE specific draw of cash for the ONE need = moving company, then you can post a Write Check in checking, to the Moving Company, no differently; it is a Paperless check activity. Put "CASH" for the check #. ATM is NOT the payee here.


Otherwise, the taking of money, or ATM draw, or holding back cash from customer Payments, means you have not yet spent that money. Getting Cash in hand does not = Spent.

It gets spent in lots of places. Also, it might be spent on different dates and NOT for the total drawn. This is why you should be managing CASH as its own Bank account.

Step 1. Draw Cash from Checking.

Step 2. Enter how Cash is being used.

Step 3. Count and reconcile cash on hand to CASH Bank, to confirm everything is accounted for.

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Highlighted
Established Community Backer ***

"can I simply use the write checks function, payable to A...

"can I simply use the write checks function, payable to ATM Withdrawal (vendor name used for cash withdrawals), and select the appropriate expense accounts? If that is not correct, can you please explain why? Thank you so much for your help!"

You are not capturing the Actual, Individual Payments to the Different suppliers of goods and services. Bookkeeping matches Reality.


If the taking of ONE amount as Cash is the ONE specific draw of cash for the ONE need = moving company, then you can post a Write Check in checking, to the Moving Company, no differently; it is a Paperless check activity. Put "CASH" for the check #. ATM is NOT the payee here.


Otherwise, the taking of money, or ATM draw, or holding back cash from customer Payments, means you have not yet spent that money. Getting Cash in hand does not = Spent.

It gets spent in lots of places. Also, it might be spent on different dates and NOT for the total drawn. This is why you should be managing CASH as its own Bank account.

Step 1. Draw Cash from Checking.

Step 2. Enter how Cash is being used.

Step 3. Count and reconcile cash on hand to CASH Bank, to confirm everything is accounted for.

Established Community Backer ***

You create a Bank account and name it Cash On Hand. The...

You create a Bank account and name it Cash On Hand.


The taking from Checking to Cash is a transfer function.

Then, you use Write Check from the CASH account, to enter how those funds were spent.


It is only Draw when the owner took money and Kept it personally.

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Thank you for your response! Instead of creating a new ba...

Thank you for your response! Instead of creating a new bank account for the cash, can I simply use the write checks function, payable to ATM Withdrawal (vendor name used for cash withdrawals), and select the appropriate expense accounts? If that is not correct, can you please explain why? Thank you so much for your help!

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