How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask R. Klein, EA Your Own Question
R. Klein, EA
R. Klein, EA, Accountant
Category: Financial Software
Satisfied Customers: 3375
Experience:  A member of the Intuit Ask a Tax Expert team and 10 years as QuickBooks Certified Pro Advisor.
63817126
Type Your Financial Software Question Here...
R. Klein, EA is online now
A new question is answered every 9 seconds

I have a couple of questions about quickbooks.1. how would

This answer was rated:

I have a couple of questions about quickbooks.

1. how would i setup the equity accounts for 5 members of an LLC?
2. Each of the members gave 60 dollars to pay the 300 dollar llc registratin fee here in Texas. We gave 60 bucks to one member and that member used his personal credit card to pay this fee. How would we setup this in each of our equity accounts in quickbooks if company bank account was not even present or the company even registered yet.

fastfile :

Exact equity accounts would depend on whether the LLC is to be taxed as a partnership (in which case you must have separate equity accounts for each partner) or as a corporation (in which case you can have a common equity account).

fastfile :

The basic entry for a corporate entity is that you will increase equity account by $300 and for the 4 members that paid cash, the balancing transaction is the you have $300 increase in organizational expense.

fastfile :

There is no transaction that is separate for the person that paid with his credit card to pay the fees.

fastfile :

Sorry for the misstatement above, just ignore the part about "and for the 4 members that paid cash"....

fastfile :

So, a simple Journal entry...increase equity by $300, and increase organizational expense by $300.

Customer:

we are setting up the company as partnership, which i created each member an equity account with a contributions and a distributions sub account

Customer:

so will we be putting two credits, one for expense and one for the contributions accounts

Customer:

i assumed to debit the expense and credit the contributions equity

fastfile :

For each partner increase their partner equity account by 60 and then increase the organizational expense by 60. Five transactions in all. All are the same.

Customer:

yes, on the journal, i did 5 transactions as a credit to the equity accounts and 1 transaction as a debit to the expense account of the 300. Seemed to work.

fastfile :

ok then you got it.

R. Klein, EA and 2 other Financial Software Specialists are ready to help you

Related Financial Software Questions