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A
accts-fgfllc-com
December 19, 2022
Question

Can I change an equity a/c that's meant to be an Owner's draw a/c with a debit balance but is set up as Owner's Equity --> Dividend disbursed and has a credit balance?

  • December 19, 2022
  • 1 reply
  • 0 views
The account is already set up and shows a credit balance but because it's a drawings account, it needs to show a debit balance, so it needs to be changed to the right account in 'detail type'. Which one would give me a debit balance?

1 reply

R
RoseJillB
December 19, 2022

Hello there, accts-fgfllc.

 

Let me share information about the Owner’s Drawing and Equity account in QuickBooks Online (QBO).

 

The owner's drawing balance has a debit balance because it is a contra for an Owner's equity account which often has a credit balance. Thus, any money paid to owners lowers their equity stake as well as the total amount of capital in that business overall.

 

In this manner, I recommend you consult your accountant on what action to take, and whether you change the account detail type. This way, we can ensure that everything is handled properly. Also, to avoid messing up your books.

 

Furthermore, you can check out this article to learn more about categorising and matching your transactions online. Afterward, you can proceed with reconciling this. That makes your books balanced and ensure that there are no discrepancies within:

 

 

Let me know if you have more concerns with any QuickBooks-related matters. I’m just a post away. Have a good one!

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