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C
CottageKeeper
March 7, 2024
Question

Missed entering previous receipts from 2022 as owner's contribution.

  • March 7, 2024
  • 2 replies
  • 0 views

I have seven receipts from 2022 that were purchased using the owner's own funds.  Historically these expenses are entered as Journal Entries as a credit to Owner's Contribution and a debit to the retailers (example Home Depot).  

Because we are in a new tax year what is the best way to record these missed 2022 receipts?

2 replies

T
Teri11_2
March 24, 2024

Credits still go to SH contribution but since year is closed and all account balances roll into retained earnings, your debit will go to RE account. I suggest do JE dated 1.1.23 to resolve this and make sure your tax person knows that you changed RE. 

Rainflurry
Rainflurry
March 24, 2024

@CottageKeeper 

 

IMO, it doesn't make sense to post them to Retained Earnings (RE) with an offset to Shareholder Contribution. Since those expenses were missed in 2022, your income was overstated by that amount.  Enter the expenses dated 2023 to make up for it.  

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