What is a good procedure to isolate company credit card transactions for personal use? I currently debit a credit card personal use expense account? I need to reimburse the company for personal transactions. I need to create an invoice for the employees. Do I credit expense credit card personal use account? Is there an easier method than creating an income reimburseable account?
What's up with the "I need to create an invoice for the employees" part in your post. Where is this coming from?
How else would I keep track of who and how much is reimbursed from the credit card statement personal transactions? Open for any other suggestions other than JE's..... This is a management requirement.. Thanks for your reply...
Allan is right, management is wrong. It isn't an A/R, it is a short term loan or an advance. By trying to put it in A/R you will have to use JE's. I'm actually wondering does management expect the employee to cut a check to pay this off? Everywhere I've been it comes out as a P/R deduction. Changing an A/R entry to a P/R entry, that's a lot of JE's!
Question is just how many credit cards are out there? If is isn't a pile you can create items to put those personal charges to a payroll advance account for each employee who has a card and create payroll items for the deduction to go to these same accounts. No JE's!
True you do have to run a BS report to see who owes what before the payroll entry, but I can't envision any system where you don't have to run some kind of report for that.
There are two easy ways to handle this:
Suggestion #2 is a good one. Suggestion #1 has huge problems. Talk to your accountant. Non-business purchases are never an expense. There is a limit on gifts given to employees and others. Amounts over the gift limits given to employees is compensation which affects payroll, payroll taxes and W2s.
Personally, I would create an asset account called "Advances to Employees." I would then create sub-accounts for each employee who charges personally to the company credit card (with the exception of the principals, why condone this behavior of employees? I'd be confiscating those cards in a hurry and go with a reimbursement for employee out-of-pocket). Each paycheck would then have a deduction from net pay to zero that individual's advances.
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