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andrew-malkin-co
April 8, 2021
Solved

In P&L how do i allocate a portion of profit to my directors currant account and enable the P&L to then show the reduced profit

  • April 8, 2021
  • 1 reply
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Original commenter did not share additional details
Best answer by Ashleigh1

Hello Andrew-malkin-co, 

 

Thanks for coming back to us here, 

 

So the usual way this is done is via a  journal entry from where the profit is currently sitting then put the money in the directors drawing account then journal that or if it is in the drawing account you then post it to the directors account and that is all you need to do. We'd recommend speaking to an accountant for advice on this. They can advice on end of year journals as well which is when a lot of users zero out the profit for the financial year and add the amount to the retained earnings profit balance forward chart of account(equity)

1 reply

AlcaeusF
AlcaeusF
April 8, 2021

Hello @andrew-malkin-co,

 

Thanks for dropping by here in the Community. I'm here to share some details about how you can allocate the profit in QuickBooks Online.

 

The Profit and Loss report shows your income, expenses, and net profit or loss over a specific period. To allocate a portion to the director's account, I recommend creating a journal entry.

 

If you're unsure of the accounts to debit and credit, please consult an accountant. They'll be able to provide expert advice on how to record it in QuickBooks and ensure your books are error-free.

 

To reduce profit in the report, you can exclude the specific income account. You have the option to customize the filter and choose which accounts you want to reflect.

 

Here's how:

 

  1. On the left navigation bar, click Reports.
  2. Scroll down and select Profit and Loss under Business overview.
  3. Press Customise.
  4. Under Filter, press the distribution account drop-down.
  5. Select Specified.
  6. Put a checkmark on the accounts you want to show in the report. 
  7. Hit Run report.

 

For more information about reports, like how to personalize and create custom financial data in QuickBooks, I recommend the following article: Customize reports in QuickBooks Online.

 

Fill me in if you have additional questions about the financial report in QBO. I'm always here to help. Take care always.   

A
andrew-malkin-coAuthor
April 8, 2021

Thank you,

I selected ALL. I think the problem instead is how to allocate a proportion of the currently shown profit to directors drawings crediting my directors account. This should show the reduction of same amount in P&L. How do i do this though is the question if you know that would be great.

A
Ashleigh1Answer
April 8, 2021

Hello Andrew-malkin-co, 

 

Thanks for coming back to us here, 

 

So the usual way this is done is via a  journal entry from where the profit is currently sitting then put the money in the directors drawing account then journal that or if it is in the drawing account you then post it to the directors account and that is all you need to do. We'd recommend speaking to an accountant for advice on this. They can advice on end of year journals as well which is when a lot of users zero out the profit for the financial year and add the amount to the retained earnings profit balance forward chart of account(equity)

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