I'm not sure what type of an account the Owners Draw should be. I am a sole proprietor with no employees so I don't do payroll. But I take money out of the business twice a month as my personal pay. Is it an Equity Account?
Yes, it is an equity account. It has become common practice to create an "Owner's Equity" account and then two daughters. The first named "Owner's Draws". The second named "Owner's Investments".
This way you can see the difference and the parent account will show any balance.
This is the clearest answer I've seen so far.
Do I need, additionally, to create a Loan from Owner type account as an "other current liability" or "long term liability" so I can use journal entries to record expenses purchased w. owner's own funds? Or does the above method preclude this method?
From QuickBooks 2009 for Mac's Help, in the section named "Mixing business and personal funds":
"Business and personal funds overview: If you pay for company purchases or assets with a personal check, credit card, or cash, you have, in effect, made a “loan†to your company. You can track these purchases in a QuickBooks' Other Current Liability account."
It'd be a good idea to read that entire section. I've quoted only the first paragraph.
