Posted 19 November 2012 - 06:09 AM
A friend of mine has just set up a small business. She is using MYOB. She has already entered dozens of purchases into the register, but has not entered any of the payments. She has paid the bills out of her own personal account, before the business account was set up. Problem is now, MYOB won't let you pay a bill from an equity account (not he way hers is set up anyway).
What is the best way to do this from an accounting perspective?
a) Delete the purchase entries from the register, and just do a big-ass general journal entry debiting expense/asset accounts and crediting equity.
b) Leave the purchase entries as they are in MYOB, and pay them out of the electronic clearing a/c or some such, then do a GJ entry transferring them to equity.
c) or another way.
Trouble is, she continues to use her personal account to pay bills when the business account is low, so until she gets established, this will be an ongoing problem.
Any accountants out there that can help me? She has Account Right Standard.