For what you did: "But the whole credit card amount was paid to the employee instead of just business expenses."

What they did not "account for" by giving proof of Business Expense, that is Taxable Bonus to them.

"Now I am trying to adjust and call some of those amounts compensation instead of business expense and track the payments to vendors for our records."

You didn't Pay the Vendors. You don't track it. If I bought printer paper from Staples on my credit card, you didn't pay Staples. You "buy" the office supplies from Me.

Clearing is never on the P&L. It is a Balance Sheet activity, so that there is no treatment of the difference as income or expense while there is any delay in the processing of this data.

Let's start Over; I write you a check to reimburse you for office supplies and other things you paid for, plus you want to borrow $1,000 so this Split entry is posted as Other Current Asset. Now you need to repay me that borrowed amount. Or, we will treat it as taxable Bonus to you, which means there will be a Taxable Fringe Benefit added to the next paycheck, linked to expense. This is Added to your paycheck and Taxes compute and are withheld. Then, I have an Employee Loan Repayment Deduction item, that is Not tracked for taxes, as a Net Pay Deduction, the same as a Wage Garnishment. That means I Deduct the original Loan amount from your takehome, because you Already got the funds, outside of this paycheck.

Here's what happens:

The Taxable addition makes taxes required, deducted from the Gross Wages on this check.

The Deduction item removes it from being part of Takehome. And that clears the Loaned amount, which was now treated as Bonus paid out, then taxes afterwards.

It helps to follow the rules for payroll and for accountable plan. And a business never makes a personal payment for anyone; you don't pay personal Credit card payments for employees. You pay Them for what you owe Them. They manage their personal lives.