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Momplusmore
August 21, 2021
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Do I record reimbursable transactions as expenses/income or "Other Current Asset"?

  • August 21, 2021
  • 1 reply
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I have been searching relentlessly for an answer to my question, and getting conflicting information. Working with a QuickBooks Desktop Pro in a sole proprietor LLC file.  This is a 1099 position (truck driver).  There are several charges that were paid for with the business debit card and some cash and then were reimbursed for those by the company I contract for.

There are hotel, uber, food, cash and supplies expenses. I've read to use  a "billable expense" account or "reimbursable expense" account with a corresponding income account. Another suggestion is using a "Reimbursable Expenses Receivable" an "Other Current Asset" account for recording the charges and subsequent reimbursement.

It doesn't make sense to me that we count the reimbursement as income or categorize hotel or food with the business expenses since they are my contractor's expenses, but have no clue how to proceed.

Best answer by BigRedConsulting

RE: There are several charges that were paid for with the business debit card and some cash and then were reimbursed for those by the company I contract for.

 

If you mean that you're spending your company's money working on a job for another company, and you know that you will be reimbursed when you submit an expense report (or similar) then I'd use an asset account to record all of the purchases and then use the same account when I'm reimbursed, bringing the balance to 0.00, for those purchases.

 

You might name the asset account, something like "Purchases to be reimbursed".

1 reply

BigRedConsulting
BigRedConsultingAnswer
August 21, 2021

RE: There are several charges that were paid for with the business debit card and some cash and then were reimbursed for those by the company I contract for.

 

If you mean that you're spending your company's money working on a job for another company, and you know that you will be reimbursed when you submit an expense report (or similar) then I'd use an asset account to record all of the purchases and then use the same account when I'm reimbursed, bringing the balance to 0.00, for those purchases.

 

You might name the asset account, something like "Purchases to be reimbursed".

M
MomplusmoreAuthor
August 22, 2021

Thank you so much for your response. It makes sense and keeps it simple.

Would you please also advise on the personal cash we used that was reimbursed to the business account? Not sure how to handle that.

 

 

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