How do I account for this?

[Top Hat]

How do I account for this?

We went ltd last year, prior to that we were a partnership.

At the time we transferred stock owned by the partnership to the ltd company.

My accountant has told me that the stock transfer was in effect a loan to the company (equal to the value of the stock), so we can take the money out tax free.

My question is how do I account for this in my accounts? I use QuickBooks.

Hope that make some kind of sense.

 

[Alpha]

Open an account called Directors loan A/c in the creditors section.

Post value of stock to your normal stock account (Debit) and the opposite entry goes to the DLA.

Surely you could ask your accountant !!

 

[Top Hat]

Thanks Alpha,

Have done it, and I think I've got it correct

Surely you could ask your accountant !!

I did, and he said sort of what you said, but I didn't really understand and I was too to phone back!