Expense claims of most companies will be from the people we have already set in the capital accounts.
So, Assuming an expense claim has been registered:
When we want to spend money from the cash accounts to a capital account, Payee shows only the customers/suppliers created and not the capital accounts. The capital accounts are only displayed when we select the same under Accounts but even then the Payee is not displayed.
Secondly, when a person registered under the capital accounts draws money from the cash accounts, why is the money not adjusted against his expense claims no matter the drawings is less or greater than his expense claims?
Suppose we had the option to select capital accounts as Payee at the time we spend money from cash accounts, when we select drawings/share of profit and enter the amount, part of the amount should be auto-populated on the next row towards the expense claim of that person as a default. This would enable proper accounting of the funds movement.
Also, regarding the capital accounts the screen appears as below.
Once you have used the capital accounts name, then it will populate that list for future payments.
This has been raised before - read this topic
With regards to the capital screen headings:
Amounts to Pay - owing to partner from contributions, expense claims & share of profits etc
Paid in Advance - money paid to the partner that exceeds their “Amount to pay” balance
Leaving the share of profit aside, if suppose a partner in a company is entitled to draw a monthly salary of say 10000 and he has a claim of say 2000. After spending the money from cash account a sum of 12000 which includes the monthly salary and 2000 claim, the capital account would still show 10000 paid in advance which is not technically correct.
So will it not be simple to read them as Withdrawal - Deposit - Claim - Difference
Paid in advance is another way of saying the person owes the money back to the company.
This may be relevant when giving an advance to an employee against his monthly salary. But in the case of people who fall under capital accounts, the amount spent on their salary no matter less or greater than their entitled salary, they are just withdrawals from the company account.
No they aren’t “withdrawals” they are “over” withdrawals which the person either owes back or offsets against future benefits. When an account is overdrawn, it is overdrawn regardless of being an employee, partner or whoever, the business has advanced them money which they are not entitled to, or in another words have been PAID IN ADVANCE.