I’d like to know the best way to handle a case where I pay for a business expense using a personal credit card. Here’s what I did:
- Create a fake bank account called “Cash Transfer” (for want of a better name).
- Enter the purchase which results in this journal:
- DR Expense Account 100
- CR Cash Transfer 100
- Then, to record the fact the business owes me a refund I did this journal:
- DR Cash Transfer 100
- CR Owner Liability 100
Ideally, I’d like to process the purchase and post directly to the liability instead of using a bank account like this.
Is there a better way?