In January we formed an LLC Partnership with 3 people to form a janitorial service.  One of the partners already had contracts in place and was using his personal bank account (PBA #1) to receive payments and purchase supplies.  He was not using any accounting software.  Towards the end of January, we opened a new business checking account (NBA#2).  I created 3 separate bank accounts in QB Online so all income and expenses would reflect everything starting January 1st.  An additional account (NBA#3) was opened for unexpected expenditures.

Separate Vendor accounts were created for each partner so that reimbursements and wages could be paid using NBA#2 once it was viable for business use and NBA#1 would be no longer needed.  I was using this method until I discovered partners do not receive reimbursements.  These expenses should go through the Equity Account for Partner Contributions and Disbursements.  After watching a video online, I tried correcting my earlier entries by going into the original expense, reclassifying it as “Partner Contribution” with the minus sign on the bottom line and saving.  However, I don’t see any of the earlier reimbursement money to the partner showing up on my books or bank statement as their receiving money (or matching up).  Also, I don’t know if my profit and/or loss under Expenses is correct.  What was the best way to make this correction and starting forward how should I reimburse my partners and so that QB Online is correct?  I still have outstanding reimbursements for January and the early part of February to enter.

Also, 2 of the partners require income from the business for living expenses.  I listed them as Vendors and categorized the Expense as “Salaries & Wages”.  I recently discovered, partners can’t receive salary, only “draws”.  Partners should only take “Draws” or “Guaranteed Income” for living wages.  I don’t know how to move previous “wages” to “Draws” or “Guaranteed Income” and if that should be a subcategory of Partnership Contributions or Partnership Distributions.  These also need to be corrected.  Can you please help on this one also?

I’ve spent many hours trying to find a solution on the internet and in forums but keep getting confused.  In addition, I’m still in the process of reconciling PBA#1 bank account and don’t want to move forward until I’m on the right track.

Please help.