What category does a credit card loan go to when the debit is for equipment for your business?
queen_kat779 asked:
Will my credit card be under a cost of goods account, expense account, loan or what? The equipment had already been paid in full by the credit card, now we are paying the credit card off. Should I name the credit card as a vendor?
Patrick
Will my credit card be under a cost of goods account, expense account, loan or what? The equipment had already been paid in full by the credit card, now we are paying the credit card off. Should I name the credit card as a vendor?
Patrick
April 16th, 2009 at 12:27 pm
In my personal business, two things happen. We have surveying crews and we have the equipment they use. I started an LLC for the equipment alone. I then rent the equipment to my company through the LLC. That way if the company gets sued my equipment is safe and vice versa.
Hope this helps.
April 19th, 2009 at 4:20 pm
Are you using an accounting software package? Your question suggests that you are. If so, there is actually an account type for credit cards. You need to create a new account for that card. You will also need to set the credit card company up as a vendor.
Charges to the credit card would initially be booked either to an expense account or a capital account. Then when you start paying off the card, you book everything other than the interest expense to the credit card account.