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    tpalval's Avatar
    tpalval Posts: 1, Reputation: 1
    New Member
    		  
    #1

    May 4, 2012, 09:22 AM
    Quick question general journal entry
    Boss paid $50 out of his pocket cash for a business meal.

    Boss has an open loan that he keeps lending the company money.

    I want to record the business meal expense but also reduce his loan balance based on his laying ou the cash.

    How to journalize this?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
    Ultra Member
    		  
    #2

    May 4, 2012, 12:27 PM
    For the 1st transaction:
    Debit an appropriate Expense account for the amount
    Credit Cash for the amount

    For the 2nd transaction:
    Debit Cash for the amount
    Credit the Owners Capital account.

    When the owners gets the money back:
    Debit the Owners Drawing account for the amount
    Credit Cash for the amount
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