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Recording Startup Investments in Sage Line 50

My business is in the startup phase. I have my own cash investments as well as other cash from family/friends to deposit into our business account, to be used for initial startup cost expenditures. etc. Over time some family members will be giving cash to help with the expenses of the business. These family members dont want anything in return, and the money is not a loan to be paid back. It is a gift. How should the cash be recorded in Sage? I am using the hotel and restaurant template for the chart of accounts but I dont know which nominal code to use, or if I should create a new one just for these gifts. The second part of my question is, how should cash injections from business partners be recorded? How should sells of shares be recorded? What if someone gives cash in exchange for shares/equity, but the cash amount may not be equal to the share selling price?

Thanks for the advice.
Rudy Zimmer

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03rd Feb 2009 09:48

New to Sage quick tip
Hi Rudy

One quick tip. Unless Sage have already done it ( as I said, I don't have access to it and it is some time since I taught it) if you are to have a Petty Cash account or similar set it up as a BANK a/c. Then, when you top it up, you can simply do a bank transfer, quoting the cheque number as the ref.

P.S. Quick tip 2. If your sales receipts are to include cheques and cash set up a SEPERATE receipts bank account. Book all cheque and cash receipts into this new a/c and when a bulk banking is done enter a bank transfer from this a/c to your current a/c. This way, when you come to reconcile your bank statement, all the r/c entries in your Sage a/c should match those on the bank statement and it just, apart from bank-generated entries (charges etc.) becomes a ticking excercise.

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31st Jan 2009 09:24

Thanks Andy
I don't have access to Sage and it's some time since I needed to access this area of the balance sheet. 'Investments' sounded wrong to me but my brain wasn't properly in gear.

ALSO, Rudy, you COULD simply enter all the investors' money in ONE account. It would work just as well but the account would be tacky form the start. If you open individual accounts, or even just one alternative account, then the correct entries can be transferred to the capital account which will always be clean when viewed later.

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30th Jan 2009 18:29

I think you mean
'Capital and reserves', Richard.

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30th Jan 2009 17:05

Good News
Hi Rudy

OK, I'll go along with that. It's just that I would rather wave a big stick now than mop up tears later!

Given that you will be taking pro. advice later I would open an account, in the Investments (I think it's called) section of your sage balance sheet for each of your investors. Just call them by name, e.g. 'Investment Rudy Zimmer'. Then whoever ultimately reviews your accounts at period end can sort them out how they think reflects the final situation.

Then Debit cash at bank and Credit these accounts with the relevant amounts.

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29th Jan 2009 14:06

You need trained help!
Hi Rudy

I am sorry if this appears a little patronising but the nature of your query leads me to think that you are already out of your depth vis-a-vis Sage and book-keeping generally.

PLEASE PLEASE do not embark on Sage until and unless you have had some, at least, training. Sage is not straightforward for an untrained person to operate; it is not a substitute for proper book-keeping knowledge.

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