How to record CC payments from business checking to personal CC used to make business purchases?
Hello, I am a small business owner (S-Corp LLC) and new to QB.
With covid heavily affecting my business, I am still trying to build up my revenue and have to use my personal credit cards to pay for business expenses from time to time. (and yes, I know mixing personal and business is not a good practice, and I will stop using personal as soon as I have stable revenue) I use my business checking to pay off those charges and trying to figure out the best way to categorize those credit card payment transactions in QB. I do not want to link my personal credit cards to QB since there are personal transactions as well. With limited funds available, I am usually making minimum monthly payments and it would be nice to have a way to track how much of the expense has been paid off as well.
I am using QBO Simple Start. Thank you in advance.
Yes, we advise not to mix personal and business funds, but sometimes it happens. Here's an article that has more details about mixing person and business funds.
Creating a Journal Entry is the best way to record the business expense you paid for with your personal funds. Allow me to walk you through the steps to record this in your QuickBooks Online (QBO) Simple Start account.
Go to the +New button at the top of the left-hand menu bar.
Press Journal Entry under the "Other" column.
Choose the expense account for the purchase on the first line.
Type in the purchase amount within the Debits portion.
Pick Owner's Equity or Partner's Equity for the second line.
Enter the same amount in the Credits portion.
Hit Save and Close when ready.
In the end, you'll need to decide how to reimburse the money. You have two options:
To determine how to categorize your credit card payments, I recommend consulting with your accountant. They'll be able to give you the best accounting advice for your business. If you don't have an accountant, check out this link to find one near you.
We strive to provide the best possible support for you about business and personal funds so that your company will continue to be successful. Let me know if you have any other questions or concerns. I'm only a post away if you need me.