How to decrease liability account when this amount moves to the credit card?

joycesyi · ‎March 19, 2019

Hi there, the structure of my company is Corporation. And it's taxed as S-Corp currently.

1. Currently we have a liability account to a person called Annie. She loans us for $10000. So the liability that we owe her was $10000.

2. As a way to decrease our liability, we let her use our business credit card buying $2000 of personal stuff last month. So we agree the new liability balance decreases to $8000 for now.

3. How to bookkeep/record this transaction correctly in QuickBooks to reflect this transaction properly? We want to decrease our liability account to her to $8000, and also want to mark this $2000 transaction on the credit card properly because right now this transaction is synced to the credit card transaction page. If we click "excluded" this transaction, we don't know how to reconcile this $2000 difference in credit card?

Please guide me the correct way I should bookkeep it step by step. I'm using QuickBooks Online Essential. Thank you very much!

Anonymous · ‎March 19, 2019

Hi there, joycesyi.

You can categorize the downloaded credit card transaction to post on your liability account. Here’s how:

Go to Banking from the left menu and select the Banking tab.
Choose the Credit Card account.
Locate and click the transaction involved to open the details.
Under Category, select the liability account where you want to post the transaction.
Fill in other necessary information
Click Add.

You can also set a banking rule to automatically post these transactions to your desired account.

Visit us here again if there’s anything else you need.

View solution in original post

Anonymous · ‎March 19, 2019

Hi there, joycesyi.

You can categorize the downloaded credit card transaction to post on your liability account. Here’s how:

Go to Banking from the left menu and select the Banking tab.
Choose the Credit Card account.
Locate and click the transaction involved to open the details.
Under Category, select the liability account where you want to post the transaction.
Fill in other necessary information
Click Add.

You can also set a banking rule to automatically post these transactions to your desired account.

Visit us here again if there’s anything else you need.

joycesyi · ‎March 22, 2019

This method works very well. Thank you MikiD!

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How to decrease liability account when this amount moves to the credit card?