Hello all,
I am new here and to Quickbooks and need a bit of help, please.
I currently run a sole trader business structure in Australia using Quickbooks Online and am having difficulty on how to categorise transactions relating to owner's equity in my banking feed. When I first started using Quickbboks Online everything was managed through my personal account, but now, I have a separate business account. My business is doing really well now, to the point that I can pay myself a steady 'wage' per week. I do this by transferring money from my business account to my personal account.
My problem is this, though, I can record the transfer in one of two ways and I do not know which one I should choose. In my banking feed under my business account, I can either:
- select the transaction, click the Categorise option, choose Expense as the transaction type, myself as the Supplier/Customer and Owner's Equity:Owner's Draw as the category, with GST set as Out of Scope (0%); or
- select the transaction, click the Record as transfer option, and set the Transfer account to Owner's Equity:Owner's Draw.
I feel like the second way is the correct way, but am just too unsure. Could someone please help me on this?
