I am setting up a client with a Quick Books account. I have all his bank statements and credit card statements, which I imputted into QB and all balances correctly.

However, now he is asking that I pull out some expenses because they are personal payments and not business payments. I'm not exactly sure where to put them to reflect that.

In any other business account I have done, it's all been business charges, never mixed. Should I just create a "Personal" category and put all of these charges into it or do it a different way?

HELP!!

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Kathy Harmacek
Your Virtual Aide
http://www.your-virtual-aide.com

Personal expenses should be coded to the Owner's Draw account, which is an equity account.

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Rebecka Melson
Virtual Business Services

Is he a sole proprietor? Then it would be a draw account like Rebecka said. If it is a corporation and he is using the corporations money for personal things then that is actually income to him, and should be recorded with his payroll.

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Sarah
Accurate Office Help

Not necessarily. In a corporation, one can be taking a paycheck with payroll deductions etc and still take an owner's draw or dividends. The tax implications can be dealt with at tax time.

In this case I will default to those with more experience. I believe the gist of what they are saying though is to leave them in, but point the expenses to the correct category. (Whether that's owner's draw, dividends, or payroll)

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Kristi Bennitt