Owner's Equity Transactions in Fastest Bookkeeping Services With QuickBooks Online

Owner's Equity Transactions in Fastest Bookkeeping Services with QuickBooks Online

Would you like to be able to record non-business transactions in QuickBooks online? Well in this articles of Owner's Equity Transactions in Fastest Bookkeeping Services with QuickBooks Online. You will learn how to record Owner’s equity transactions between the company and the owner.

If you have any questions about this topic you can leave them in the comments section below and I’ll do my best to help you and of fastest bookkeeping services if you feel the article helped you I hope you will follow our blog and get updates on new articles that come out all the time.

Owner's Equity Transactions

Two type Of Owner’s Equity Transaction made in QuickBooks Online -

Owner’s Equity Transaction - Owner’s pay and Personal Expenses.
Owner’s Equity Transaction - Owner’s Investments.

Owner’s Equity Transaction - Owner’s pay and Personal Expenses.

When cash comes from the company's: bank account, credit card or cash box, to the owner's non-business funds, the correct account to record this is already in QuickBooks online's chart of accounts it's called Owner's pay and personal expenses.

Owners pay and personal expenses- will show the total amount of money taken from the business cash. And given to the owner for non-business reasons.

Owners pay and personal withdrawal expenses for example ------

On January 16th, 2020, Wanda withdraw $800 from the company bank account for non-business, personal use.

It's the same expense window.

We have been using all along and the only difference is we’re going to put on the line where it asks us for an account. The account we will use Owner's pay and personal expenses.

Transaction Report Analysis

So what will the result be in the trial balance? After we record this January 16 transaction. Well we know that the cash and bank will decrease by eight hundred and become $4000. That's where the money's coming from and if the owner took out $800 it means for the very first time, owner's pay and personal expenses will show up in the trial balance for 800 dollars.

Owner's pay and personal expenses Transaction Posting in QuickBooks Online.

Click new+ and go over to expense the date is January 16th of 2022. we can leave the payee blank because it's an owner to business transaction and that's fine the payment account, the account the money is being paid from in this example is cash in chase bank and the money is going to the equity account or the account under account type equity owners pay and personal expenses and the amount is eight hundred dollars. It’s that simple if the owner takes business money for non-business use. Then we click save and close.

The results are exactly as what we expected cash and bank went down to $4000 and for the very first time owner's pay and personal expenses showed up in the trial balance for 800 dollars.

we can use this same account for non-business services.

Owners pay and personal Payment expenses for example …...

On January 17, 2022, Wanda paid check # 1002 to Ned's taxi for a non-business personal ride 50 dollars.

This time we will use the checks window but we will also choose owner's pay and personal expenses.

So what will be the result? Well if we are paying from cash in bank. Then cash in bank will decrease you see this, it will decrease by 50 dollars. That means we have fifty dollars more that we took out of the company for non-business use. So owners pay and personal expenses increases to 850 dollars and that will be the result or the correct result.

Owners pay and personal Payment expenses posting in QuickBooks Online

Anyway after we record the check. we click new+ then go to check we put the date as the 17th January 2022 this time we do have a payee because you're paying a third party and remember the money is coming from chase bank but it is not going towards a business expense it's going towards the Owner's personal pay and personal payment expenses and it was check # 1002 in the amount of fifty dollars when we click save and close you can see that cash in bank is exactly as what we expected $3950 and Owners pay and personal went up to $850.

Let’s double click that and see that the reason why we know the total money that the owner took from the company was $850. First Wanda took on January 16, 800 cash from the account then on January 17th she wrote a company check for something that had nothing to do with the company. So this is not transportation expense its owner's pay and personal Expenses.

Owner’s Equity Transaction - Owner’s Investment

Now what about when cash comes from the owner personal non-business money. The owner puts that money into either the company bank account or the lock box the account that we record those transactions into is also already in the chart of accounts and it's called owners investment.

Owner’s Equity Transaction - Owner’s Investments for example ……...

On January 18th, 2022, Wanda took 200 of her own personal non-business cash and put it into the business cash lock box.

we will use the deposits window. We will use the owner's investment account.

Transaction Report Analysis

Now if we do this. What will be the results? well we know that money is coming into the lock box so the account that says cash on hand is going to increase by two hundred dollars because that's the amount that Wanda is putting in the cash on hand will become 500 and because that two hundred dollars came from the owner's personal money that means for the very first time the account called owner's investment will show up in the amount of two hundred dollars. Which is the amount that the owner took from their personal and gave to the business. So very simple let's just click reports and trial balance just so that we can see the results immediately.

Owner’s Equity Transaction - Owner’s Investment Posting in QuickBooks Online

click new+ go over to bank deposit and date on the 18th January, 2022, the money that was deposited was not deposited in the bank account it was deposited in the cash lock box and we can leave the name blank because it's between the owner and the company.

The account will be Owner's investment and the amount that in this case that was invested into the company from the non-business owner's personal cash $200. Now we click save and close.

We can see the results are exactly as what we expected cash on hand has increased to $500 and for the very first time owner's investment showed up for $200 that represents the amount of money taken from the owner and given to the business.

Thanks for Reading.