Question : What category does a credit card loan go to when the debit is for equipment for your business?
Will my credit card be under a cost of goods account, expense account, loan or what? The equipment had already been paid in full by the credit card, now we are paying the credit card off. Should I name the credit card as a vendor?
- asked by queen_kat779
All Answers:
Answer #1
In my personal business, two things happen. Wehave surveying crews and we have the equipmentthey use. I started an LLC for the equipmentalone. I then rent the equipment to my companythrough the LLC. That way if the company getssued my equipment is safe and vice versa.Hope thishelps.
- answered by Ern
Answer #2
Are you using an accounting software package? Your question suggests that you are. If so, thereis actually an account type for credit cards. Youneed to create a new account for that card. Youwill also need to set the credit card company upas a vendor.Charges to the credit card wouldinitially be booked either to an expense accountor a capital account. Then when you start payingoff the card, you book everything other than theinterest expense to the credit card account.
- answered by GordShumway
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