Part of being an owner and running a business includes spending your own hard earned dollars. It’s a fact of entrepreneurship - you’ll likely have to make capital contributions. But, how should you record this in your books? It’s vital that you record it and record it correctly. We’ve had many clients ask us about this, so we made a tutorial to help make the process easier.
How to Record an Owner’s Equity Contribution:
Go to Record Deposits.
Select the correct checking account.
Select the date of the transaction.
Select the correct owner who contributed the money (this is very helpful if you have multiple owners).
The “From Account” will be the owner’s contributions account. This should be an equity account.
The memo space is for your own notes, if needed.
Include the check number as a reference, if applicable.
Although it asks for “Class” information, you likely will not need this. This is because the checking account and the owner’s equity account are balance sheet accounts, so this will not benefit you to include.
Then, include the amount spent.
Finally, save and close.
Now, you can see this transaction in your check register. It’s also shown in your owner’s contributions. If you would prefer to watch our step-by-step tutorial, please click here.
If you run into issues or have questions working through this tutorial, please feel free to contact email@example.com