Credit Card Payment as Equity
I have QB2009 and I want to record a credit card payment as equity. How do I show it on a deposit. I do not use QB for processing
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05/05/09 6:09am PDT
Viewed by asker 05/06/09 11:42am PDT
Viewed by asker 05/06/09 11:42am PDT
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05/05/09 7:53pm PDT
On a deposit, you would credit owner contribution account (as opposed to an income account). Normally a deposit will either credit A/R or an income account. In this case, there is no A/R and there is no income - the owner is paying the bill from personal funds and contributing capital. So instead of crediting income or A/R - pick the contribuiton account.
It should already exist, if not - add it to the Chart of Accounts (it is an equity type account with a normal credit balance).
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05/06/09 6:35am PDT
Actually I am not paying the bill with a credit card. I received a payment for a service that I want to show as equity.
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05/06/09 11:33am PDT
The solution
Did you create an invoice? If you did, then you created an A/R and recorded income (credit to income account) when the invoice was created.
So now when you receive payment, you credit the A/R and debit cash. If you credit equity, you will leave the A/R open. I don't understand why you feel you need to record this as equity. The equity accounts show draws and contributions from the owner and retained earnings (which is accumulated earnings). You should only record activity to equity accounts if you are contributing additional funds to the company or withdrawing funds. Net income will close to retained earnings at the end of the year.
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05/06/09 11:42am PDT
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I understand what you are saying and I will mark this as answered. I will use your information to try and record this entry as best I can.
