Capital account help needed

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:30AM in AAT student discussion
As a project I have taken the balance sheet from a previous year end where the equity of the business stood at Share Capital £100.00 and retained profit of £535.00. A Creditors liability of £20000+ being a loan from the directors due to be repaid within the year.<BR><BR>Directors as partners of the company have loaned an equal amount to the company as capital prior to last year, however the amount loaned is showing as a liability 'Directors Loan Account' but not as capital on the balance sheet. The original journal was set up as Cr Directors Loan Account Dr Opening Balance Equity, is this correct?<BR><BR>Badly need help!!!

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Capital account help needed

    The credit entry is directors loan but the debit entry will be where ever the money went i.e. introduction of fixed asset, bank account etc. If you want to email me some more details I'll try and help you, my address is in the profile.<BR><BR>Annette

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