A general contractor has an account payable of $4000 to the Painter.
The general contractor pays the painter $4000 using another business's general account that the general contractor owns called LLX Properties.
How is this transaction recorded in Quickbooks? It can't be a loan to LLX Properties because the general contractor never deposited any LLX Properties money. The transaction was straight from LLX Properties.
So, the contractor has a bill payable to the painter. But because the contractor doesn't have enough funds in the bank account, he pays the painter using another (separate) entities checking account. The gen contractor wants to make sure he puts the money back into LLX Properties. So this would definitely be a loan. Can you break down the steps to me further please.
What about LLX Properties books? it's a loan to the gen contractor.
Since the contractor uses the other account to pay the painter, you'll need first to enter a Bill. This way, you'll have a reference when they pay this in the future.
To ensure that the money puts back to the LLX Properties, you can enter a journal entry to record the transaction. For the Credit, you can use the liability account it's the credit note: Loan form LLX and Accounts Payable for the painter - Debit.
However, I'd suggest contacting your accountant to ensure the accuracy of your books.
Once done, apply the credit to the bill, so you can process a Bill Payment. Just follow the steps and articles shared by my colleague MaryJoyD for the process.
If you need further assistance with this process, feel free to get in touch with our Customer Care Team. They have extra tools that can walk you through the steps.
Also, you can browse related topics, such as managing income and expenses, running reports, etc. from our general support page. For more info, please check out this resource: QuickBooks topics.
Let me know if you have other questions managing your transactions in QuickBooks. I’ll be around ready to help you anytime. Have a good one!