I have a few doubts, and I hope someone can help:
I started an S corporation in CA in Aug 2005, and since
I wish to use the cash basis of accounting.
(1) I paid someone $4000 in wages for 2005. But the cheque I issued them was less because of payroll taxes witheld. (~$350)
Since I paid the govt only in Jan 2006, this expense is for 2006, correct ? (~$350)
How do I make the journal entries, and what dates do I put on them?
(2) A phone bill was due on Dec 15 2005.
It was paid using a company credit card on Dec 15 2005.
However, the credit card was paid only on Jan 15 2006.
Is this still an expense for 2005?
Ie, do I treat the credit as a loan from the credit card company?
(3) Since I use a home office for my S corporation, what form do I file for the home office use? I saw a form that said it needed to be filed with schd C, but I am filing 1120S instead.
(4) What publication do I read for home office use by an S corporation ?
In particular, does the company need to reimburse me for electricity use or occasional telephone use?
AK in CA
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