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November 18, 2023
Question

I BOUGHT STOCK ON MY PERSONAL CC HOW DO I RECORD IT AS A DIRECTORS LOAN I HAVE A ACCOUNT SET UP BUT ITS COMING UP THAT IVE TAKEN IT OUT INSTEAD OF IN

  • November 18, 2023
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1 reply

JessT
November 18, 2023

Hi there, squarezonedpayme!

 

Thank you for seeking assistance with rectifying your transaction records for the stock item purchased with your personal card. As you mentioned, this transaction should increase your Director's Loan account.

 

First, let's define the setup of your Director's Loan account. Normally, it's Non-current Liability type, as stated in Step 1 of this article: Record a director's loan in QuickBooks Online. If the one you have is of a different type, please seek assistance from your accountant.

 

 

Second, create a clearing/wash/barter account, which can be a bank or cash type used as a payment account to record the stocks you purchased. Clearing accounts always maintain a zero (cleared) balance. Therefore, any balance incurred in this account will be transferred to the Director's Loan account.

 

 

Third, record the purchase you've made. Your payment account is your clearing account in this case.

 

 

Finally, transfer the balance from the clearing account to the director's loan account via journal entry.

 

 

Here's how the transactions are posted in the mentioned accounts:

 

 

 

When it's time to repay the loan, just create a check or an expense transaction. Then, your Payment account is your business checking or savings, and use the Director's Loan account in the Category details section. 

 

If you have more questions in mind, feel free to go back to this thread. I'll be here to help you again.