With business bookkeeping and basic tax tips for new and old entrepenuers

Tuesday, July 20, 2010

Personal Expenses on the Credit Card

If you are also using a credit card for personal expenses and business expenses, then you will need to make an entry showing equity withdrawals for any personal purchases. Let’s say you used the credit card to buy some clothes at TJ Maxx. The account you would assigned to this is Owner or Equity Withdrawals. You want to record these transactions even though they are not for the business so that you can keep a correct balance payable on the card. Now when you make a payment on the credit card, you will debit the Bank X Credit Card account, and credit the Bank Account used.

Next, how do I show an occasional business expense if I use my personal credit card?

By Alamo Bookkeeping Associates

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