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bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4198
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Im new to using accounting software. How do I treat a payment

Customer Question

I'm new to using accounting software.

How do I treat a payment to a personal credit card, that was used to purchase business stock?

Submitted: 3 years ago.
Category: Tax
Expert:  bigduckontax replied 3 years ago.
Hello, I'm Keith and happy to help you with your question.

You have a payment from Cash/Bank, which was made to your debit card, I assume?

If so the balancing entry would be to Stocks.

Book keeping entry Debit Stocks, Credit Bank/Cash.

The balance on your Bank/Cash account would have been reduced by the cost of the stock bought and the balance on the Stock account adjusted by a similar amount. Your books now balance and both balances reflect the reality. Simple; as the Meercat in the TV advert would say!

I do hope I have helped, like many book keeping entries it just seems complicated,but actually it isn't that convoluted.

bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 3 years ago.
Thank you for your support.