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Directors Loan Accounting in Sage - Postings/Setup Questions

  • 12 posts
  • # 98022

I'm a newbie and I've got myself SO confused and my Directors Loan account is a mess....I seem to be struggling with posting to and from my directors loan account and having read differing opions on the web, I'm not sure if mine is set up correctly...

I have 3100 set as Directors Capital and 3101 set as Director Drawings is that correct ???

I have it set up that, I have personal money paid in to the company as: eg £200 Debit to Bank (1200) and £200 Credit to Directors Capital (3100)

So. should I be posting money taken from the bank/cash account as a BP to 3100 and then do a journal entry from 3100 to 3101 for the same amount??? Or do I post the money taken out straight to 3101

And,

How should I post that the company paypal account, paid for a personal item, which needs to be shown through Directors Drawings? Do I account for the payment in the normal way and just do a journal entry from Capital to Drawings???

I think I've currently got incorrect debit and credit entries all over the place in 3100 and 3101 :( and I'm not sure how to correct it or if I can do a journal entry to correct it???

  • Member
  • Practice Licence
  • 46 posts
  • # 98023

Hmmm,

Ltd Co or Sole Trader?

  • 12 posts
  • # 98024

Ltd

  • Member
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  • 46 posts
  • # 98025

Ahh, ok

So really there is only a directors loan in a Ltd co and any money put in by the director or taken out goes through the Directors Loan Account (DLA)

 

Normally on Sage, I would put a DLA in the 2000's, around 2300. The reason is that any money put in by the director is owed by the company to that director and 2000 is where the creditors of the company go. It's not wrong to be in 3000, but when looking at company liabilities it helps if all in same place.

so:

 

Money in Dr 1200 CR 2300

Money out CR 1200 DR 2300

 

Paypal - think like a bank account so

CR Paypal (bank) DR 2300

 

ok so far?

  • 12 posts
  • # 98026

Think so...

Your saying to treat the DL account as an "account" where money goes in and out just like you have money going in and out of the current account (1200)

Paypal - still mulling it over....hang on lol

  • Member
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  • 46 posts
  • # 98027

You've cracked it! Just like a bank account.

If your in a muddle with your ledgers, email a spreadsheet to markhyw@yahoo.co.uk and i'll have a look at a tidy up if it helps.

 

The forum's a bit clumsy as each time I reply I have to log back in etc.

  • 12 posts
  • # 98028

Paypal .... Let me attempt to give the scenario so I can visualise what to do...So,  I want account for the fact that a personal purchase has been made on the company Ebay account and paid for, by the company Paypal account.

Normally, for ebay purchases that have been bought by the company and for the company, I enter a supplier invoice for my Ebay Purchases under 5000 and post the payment to Paypal

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  • 46 posts
  • # 98029

Yep

so you are DR purchases and CR paypal

  • 12 posts
  • # 98030

Email sent :)

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  • 46 posts
  • # 98031

so with the directors personal purchase:

Dr Director and CR Paypal

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