If i wanted to take out some cash for the director to pay for expense like gas and item that need cash payment first, where should I categorize this section.
The best way is to establish an account under
Cash accounts. Name it something like
Petty cash or
Cashbox. Then use Transfer Money to transfer some cash from your bank account to the cash account. When you buy things for the company with cash, use Spend Money from the cash account.
Another way is to have the director use personal funds. Then file a claim under
Expense Claims. The company can then reimburse the director to clear the claim. Or, if the director is an owner, the claim can be cleared to a capital account or owner’s equity. There are several topics on the forum about expense claims. Also read the Guides.
Note that by “owner” I mean a sole owner or a partner. I am not referring to a shareholder in a corporation or stock company, whatever that form of organization may be called in your jurisdiction. The capital account to which I refer is a personal capital account and has nothing to do with shareholders.
If the person is a director/owner then the business is a company (share capital) so the expense claim should be cleared to Shareholders Loans if its not gong to be reimbursed by payment. To clear to capital implies that the company is going to be issuing more shares in lieu of the payment.