Hello,
A shareholder of the corporation I’m doing the books for regularly pays for company expenses with his personal accounts and then e-transfers himself the amount from the company. How to I record these transfers in QBO, I’m not sure which accounts to use.
thank you.
Create a liability account called 'Due to Shareholder'. To record the expense incurred by the shareholder on behalf of the corporation, create a journal entry: debit the appropriate expense account, credit the newly-created 'Due to Shareholder' liability account. This books the expense and creates a liability for the corporation to reimburse the shareholder.
Then, when you record the EFT payment to the shareholder, assign the payment to the 'Due to Shareholder' liability account. This will remove the liability.
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