I paid some costs to set up the company, which I paid myself so my journal was:
a. Dr (Asset) Formation expense 1
b. Dr (Asset) Formation expense 2
c. Cr (Asset) Loan account total 1+2
In the tax reports, a & b show as purchases, which I agree with.
However, the loan account transaction (line c above) is showing as a Sale, and I don’t understand why. It is not a sale in the P&L reports,
This is my first quarter, and I have very few transactions so It’s easy to see now.
Why is the loan account credit shown as a Sale in the tax report?