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Transferring a sale from one company to another

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  • Transferring a sale from one company to another

    One sole proprietor owns two companies. Company #1 accepts credit cards and Company #2 does not. The sale belongs on Company #2, but the customer wanted to pay by credit card, so it was run through Company #1. The company owner then wrote a check from Company #1 to Company #2. How do I handle this transaction, since he wants the sale to show up under Company #2? Thanks in advance for your help.

    UPDATE: Just to be clear, he doesn't want the sale in Company #1 to show up there, but he wants the sale to show up in Company #2.
    Last edited by Walker.sue; 05-07-2020, 01:40 PM. Reason: Clarification. added tags

  • #2
    This would be a lot easier if you were not concerned about showing the sale

    in company A - journal entry debit sales, credit equity investment, then write a check and use equity drawing as the expense for the check

    in company B - journal entry debit equity drawing, credit sales, then deposit the check and use equity investment as the source account for the deposit

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    • #3
      One of the best ways to transfer assets, without having all of the assets and liabilities moved from one corporation to another, is to sell them from the first corporation to the second at a fair market price.

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