How do I reimburse myself for expenses paid by personal funds?

Thanks for using QuickBooks Online, chicanoxl.

When we reimburse a personal expense, we can record it as a check or an expense. Since, you already recorded the expense, then we can proceed to the next step, which is to record the reimbursement. Let me guide you with these steps:

1. From the Create (+) icon, select Check or Expense.
2. Select a bank account to use to reimburse the personal funds.
3. Select Partner's Equity or Owner's Equity in the Category column.
4. Enter the amount to reimburse.
5. Select Save and close.

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Hello, Can you please help with a query?

I am the owner of the company. I am acting as contractor of my company and will do 1099.

I used personal funds to cover business expenses. I entered individual item receipts individually as expense. How do I get reimbursed using quickbooks desktop 2020 software system?

I would appreciate a reply.

Thanks

Rohit

Hi Rohit!

I'll guide you on how to record your reimbursement, but please have the accounts checked by an accountant.

You can record the money you put into your business as a deposit to your bank account or petty cash account and categorize it as Owner's Equity (you can create this account). Then, record your purchases against the bank or petty cash, depending on what you used in the actual.

When you reimburse yourself, add yourself as a vendor so you can write a check for you. The check will be against our bank or petty cash and you'll use the Owner's Equity category.

After this, you can run a quick report on your equity account to see the movement of funds.

You can find more references for QuickBooks Desktop by clicking on the Help menu and choosing QuickBooks Desktop Help. Press F1 on your keyboard will also open the Help window with articles related to the page that you're working on.

Let me know if you need more help in recording your transaction. Have a good one!

Thanks for taking time to reply. I am a beginner to quickbooks. I used different credit cards to pay for different type of items including travel, office supplies, lodging etc... I have entered individual amount and receipts monthwise along with the soft copy of receipt. I want to receive deposit directly to my bank account.

Can you walk me though the process over a call sometime as per your convenience? 

Thanks

Rohit

You're welcome, Rohit!

Sure, I'll be more than happy to provide more details for you, and thanks for the additional information as well.

The idea here is the more personal money you put into your business, the more you accumulate equity funds. We'll do a different step since these are credit card transactions, but the principles and the effect on your books are the same.

Create an equity account:

1. From the Lists menu, choose Chart of Accounts.
2. Right-click anywhere and choose New.
3. Select Equity and click Continue.
4. In the Account Name field, enter something like Owner's Equity.
5. Select Save & Close.

Create a bank account or petty cash account:

1. Right-click anywhere in the Chart of Accounts.
2. Choose New and select Bank.
3. Click Continue and enter the name of your business bank account.
4. Enter the bank balance at the time you start your business.
5. Click Save & Close.

Record your non-inventory expenses and purchases against your equity account via journal entry. You can create a journal entry for every transaction, or you can create a lumpsum JE. 

1. Click the Company menu.
2. Select Make General Journal Entries.
3. On the first line, select your equity account and enter the amount in the DEBIT column. Debit because that's the normal increase for an equity account type.
4. On the second line, select the account that categorizes your expense and enter the amount in the CREDIT column. Example: Offense Supplies expense.
5. Click Save & Close, and do this on every transaction.

For a lumpsum journal entry, you'll want to compute your total purchases and enter the total amount in the equity line. Then, specify the breakdown of the categories.

Reimburse yourself: Add yourself as a vendor and create a check for yourself.

1. From the Banking menu, select Write Checks.
2. In the Bank Account field, select your business account.
3. In the PAY TO THE ORDER OF field, click the inverted triangle and select <Add new>.
4. Select Vendor and click OK.
5. In the VENDOR NAME field, enter your name and click OK to save your vendor profile.
6. In the Expenses section on the table, select the Owner's Equity account.
7. Enter the total amount of the reimbursement.
8. Enter a memo and click Save & Close.

For inventory purchases, you can deposit funds to your petty cash account, as shown in my very first screenshot above. Then, record your purchases against it by creating a check transaction.

That's it. My shift has ended, but my colleagues in the next shift will be able to assist you if you have additional questions. Have a good one!