Owner's Contribution


K

Kelly

I have some purchases that were made before my compay was started, so I'm
putting them into and expense account named "Owner's Contribution". When I
enter them into Accounting Express 2007, I don't want the amount from those
expenses to be subtracted from my Checking account, but rather increase the
expense account.

What's the best way to enter these purchases?

Any help is greatly appreciated! :)
 
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S

SumCPA

Let's say you personally paid for office supplies of $25 before you started
the company. When you enter this expense into the business, you should
record it in a journal entry: debit the Office Supplies Expense account for
$25 and credit Owner Contributions (set this up as an Equity account) for the
same $25. The date of this journal entry should be the actual date of the
purchase, if possible.
 
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K

Kelly

Thanks for the advice - I will try it out! :) Is there a reason that it
would be an equity account instead of an expense account?
 

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