Company Cheque Personal Expense

Company cheque or credit card used to purchase personal expenses

We purchased an ATV and my husband wrote it on the company account but it should have been a personal cheque. How can I fix this?

If this is an incorporated company, code the purchase to your shareholder loan account. Then make a contribution with a cheque written on your personal account for the exact amount as the company cheque. Code your personal cheque to the shareholder loan account. The two entries will offset each other.

The entries would be:

Company Cheque Written For a Personal Expense

DR Shareholder's Loan
CR Cash in Bank

Personal Cheque Deposited to Company Account

DR Cash in Bank
CR Shareholder's Loan

If this is an un-incorporated company, run it through the owner's draw and owner's contribution accounts instead of the shareholder's loan account.

Comments for Company Cheque Personal Expense

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Jul 12, 2016

How to Account for Personal Expenses Run Through Business Accounts
by: Canada

The bookkeeping software I use is QuickBooks. I have a question about items on receipts that are not business expenses. The owner of the company I work for is also the foreman so he controls the company's spending. Often, when he gets fuel he will also buy drinks and cigarettes. Should I be separating the amount spent on drinks and cigarettes from the amount spent on fuel. Say, $1100.00 spent at 'Shop and Hop' $100.00 of that being spent on drinks and cigarettes.

The other question I have is being that he is a foreman/owner he will from time to time allow his wife to use the business checkbook to purchase around $300-$400 in groceries, no more than once a month.

I'm unsure how I should be recording these non-business expenses in QB.

Jul 12, 2016

Recording Personal Expenses
by: Lake

Personal expenses (nonbusiness expenses) funded from business funds should be charged to Owner's Draw if it is a sole proprietor or Shareholder Loans if the business is incorporated.

So .... Yes the drinks and cigarettes are not expensed but charged back to the owner. This also applies to groceries.

Oct 07, 2016

Personal purchase on a company visa
by: Anonymous

I have personal purchases on a company visa card. I am unsure how to post them. My boss has a prof corp and a numbered company also.

Oct 07, 2016

Personal purchase on a company visa
by: Lake

You probably won't see this post as you did not include your email address ... so I couldn't notify you.

Assuming you are an employee of the company/corporation, you need to charge your personal expense to an Employee Receivable account with is a current asset.

You should then make arrangements to pay back the money. In future, a better practice is to use your own funds for your personal expenses.

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