bank account used for business and personal use

bank account used for business and personal use

Didn't find your answer?

How do I deal with the closing balance of a bank account which has been used for business and personal? I cannot take the closing balance as it includes a lot of day today personal expenses, do I recalculate what the true balance would be if I include only business expenses for the balance sheet and then hold a detailed spreadsheet demonstrating how this is achieved?

Its driving me mad!!!

Thank you in advance

 

Replies (5)

Please login or register to join the discussion.

avatar
By craig preece
21st Sep 2016 16:18

If it is a Ltd then it is either the Ltd's bank in which case it goes in or not in which case is doesn't.
S/T or P/S the other side of the transactions will have gone to the capital account already so the balance is the balance.

Thanks (0)
Danny Kent
By Viciuno
21st Sep 2016 16:38

No, the business bank account should show the actual balance at the year end (less/add any of the usual suspects).

All the personal transactions should be shown through the directors loan account or drawings and will need to be analysised out in order to prepare the accounts properly in the first place.

The company owes the director/owner the money.

Thanks (1)
Replying to Viciuno:
avatar
By carolmd
21st Sep 2016 16:53

That is so helpful, why nowhere can you obtaina definitive onthe directors loan account? I have analysed all items however I did not know how to treat the non business ones, many thanks!!

Thanks (0)
Replying to Viciuno:
avatar
By carolmd
21st Sep 2016 16:53

That is so helpful, why nowhere can you obtaina definitive onthe directors loan account? I have analysed all items however I did not know how to treat the non business ones, many thanks!!

Thanks (0)
By johngroganjga
21st Sep 2016 16:39

What you certainly don't do is calculate a hypothetical balance as if certain transactions had not taken place, and then include that balance in the balance sheet. You either include all the transactions or none of them.

Thanks (1)