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two business expenses for sole traders

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pahglass
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two business expenses for sole traders

HI all we have 2 businesses and one has paid a substantial amount of invoices to another,i have recorded these as personal spending  just wondering if anyone has a better idea of how to record them as an expense or a loan to the other business 
?

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Tracey_H
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Re: two business expenses for sole traders

Hi @pahglass 

 

Thanks for your post. This is something you would need to speak to your accountant about as the required accounts can be different for different business structures.

 

Generally speaking,  you could have loan liability accounts set up in each company file to record these types of transactions.

 

For example, Business A buys materials from a supplier and Business B pays that supplier bill:

 

In Business A

  1. record the purchase as normal
  2. record a Pay bills transaction and change the Pay from account to the Business B loan liability account

In Business B

  1. record a Spend money transaction with the Pay from account as the bank account and allocated to the Business A liability account

Please let me know if you need further help.

 

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.

Cheers,
Tracey
Previously @bungy15

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