Hello @Carissa22 ,
I wouldn't suggest re-naming the Cash on Hand account as it is the wrong account type. Owner's Equity accounts need to be the account type "Equity" so they show up in the proper place on the balance sheet.
Rather you should create the Owner's Equity accounts as shown above in this post, and then clear your COH account into the Owner's Equity accounts. You say you were subtracting from the COH account each time you used personal money for business expenses and adding to the COH account each time you spent business money for personal expenses. Then a negative balance in the COH account would indicate that there were more contributions than withdrawals. A positive balance would indicate that you had drawn more cash personally than had been put in. You clearing entries would be as follows:
If you have a $10.00 positive balance in your COH account (for example):
DR CR
COH 10.00
Owner's Capital 10.00
If you have a $10.00 negative balance in your COH account:
DR CR
COH 10.00
Owner's Draw 10.00
Going forward:
Spend personal money on business expenses:
DR CR
Expense Acct 10.00
Owner's Capital 10.00
Spend business cash, cheque CC on personal expenses:
DR CR
Cash/Bank/CC acct 10.00
Owner's Draw 10.00
Just keep in mind that QB does not operate with the DR/CR terminology, but rather each transaction is referred to as an "Increase" or a "Decrease". Just remember this about account types:
Income Accounts: DR decreases, CR increases
Expense Accounts: DR increases, CR decreases
Asset Accounts: DR increases, CR decreases
Liability Accounts: DR decreases, CR increases
Equity Accounts: DR decreases, CR increases
It is these increases and decreases that allow your financial statements to "balance" and leads to The Accounting Equation which is fundamental to double-entry accounting: Assets = Liabilities + Equity
Hope this helps.
