As the name implies, owner investment is personal capital invested in a company by the owner or a partner, either to start it or keep it going. It is critical for companies, particularly those in their early stages. It allows them to recruit more staff, perform research and development, and purchase equipment, among other things. You can easily join and monitor your own invested capital or business partner investment in QuickBooks. This ensures that the data is reported correctly on the financial statements. As a result, we’ll show you how to record owner investment in QuickBooks in this post.

What is the Equity Account?

An equity account is a form of account that allows you to track the amount you’ve invested. This equity keeps track of all the capital invested in the company by the owner or partners. Equity accounts are also known as capital accounts in accounting, and they are used to document financial transactions of a company on behalf of investors or shareholders.

How to setup an owner in QuickBooks

The first step in tracking the money you or your partner have invested in the company is to add yourself, the owner, or a partner as a supplier in QuickBooks.

  • Select ‘Expenses’ from the drop-down menu.
  • Then go to the ‘Suppliers’ menu and select the New Supplier choice.
  • After you’ve filled in all of the necessary details, save it.

How to Setup an Owners Equity Account in QuickBooks

After you’ve added the owner or partner to QuickBooks as a supplier. Now you must establish an equity account for the company owner or partner to monitor the amount invested.

  • Choose the ‘Map of Accounts’ option after clicking the gear icon.
  • Next, choose ‘Fresh’ from the drop-down menu.
  • From the Account-type drop-down menu, choose ‘Equity.’
  • From the Info Form drop-down, choose ‘Owner’s Equity’ or ‘Partner’s Equity’ depending on your needs.
  • Complete the remaining fields, then Sow and Close.

First, you must create an equity account for the owners and partners if you intend to create multiple equity accounts for them. Simply select Is Sub-Account after filling in the details for the other equity account, and then enter the version you built earlier in Parent Account.

How to record the owner’s investment in QuickBooks

To record an Owner deposit into the equity account, follow the steps that are as follows:

  • Pick the ‘Bank Deposit’ option after clicking the +New icon. From the Account Drop-Down menu, choose the bank account where you want to deposit the owner’s investment.
  • Indicate the date the funds were deposited.
  • Next, in the Add funds to this deposit section, in the Received From the area, type the investor’s name, such as Owner or Partner.
  • Then, from the Account drop-down menu, pick the equity account you previously built (i.e. Owner’s Equity or Partner’s Equity).
  • In the Sum area, select the Payment Method and the investment amount.
  • Choose Rave and then Close.

How to Record Owner Deposit Money Into Business Journal Entry

You may also use journal Entry in QuickBooks to monitor owner investment. You can also record the initial capital you put into your company using this tool. It may be a direct cash investment or money spent on assets, equipment, or inventory. To learn how to document an owner investment in QuickBooks using a journal entry, follow the steps below.

  • Pick the ‘Business’ option from the top menu bar, then the ‘Wake General Journal Entry’ option.
  • After that, a new window with a spreadsheet-like interface will appear.
  • Account, Debit, Credit, Customers, and Class will be the five columns in the window.
  • From the Account column’s first row, pick the Owner’s Equity and the required equity account. Join the account where you want to deposit the funds in the second row.
  • Pick one of the savings or checking accounts in the Debit column.
  • Join the same number in the Credit column as the initial investment.
To End with

To conclude, QuickBooks Desktop software helps you manage the books and accounts of a particular organisation and to do that, and it comes with a lot of features and functions that make the whole thing very easy to work. This blog’s whole idea is to help you understand the different aspects of equity and things associated with the same. I hope that this blog helps you understand the topic and was worth your time. 

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