Cash Book Entry

[Sheena]

Good Morning,

A sum of money was paid into the Company Credit Card for an employee to withdraw and use. Unfortunately the limit on the credit card did not allow the full withdrawal.

The employee then withdrew the balance needed from his personal account and this was paid back to him but from a different Company account instead of the Company credit card account.

I am not sure which account to use in the Cash Book to allocate this re-imbursement back to the employee.

Please help

[Kevin Smith]

I would create a cashbook called "Other Cash" and treat it like a petty cash account. Create a loan account for the employee. In the Other Cash cashbook, receive the additional amount against his loan account. Capture the payments to the relevant expense accounts in "Other Cash". This would clear the "Other Cash" balance to zero, and you can reconcile it. In the cashbook for the other company account where he was refunded from, make a payment to his loan account. This would clear his loan account, and the "Other Cash" cashbook will now also be zero.

If you don't want to create the additional cashbook, just treat the entry as "Petty Cash" - receive the cash from him against his loan, declare the expenses in the petty cash cashbook, and make the payment from the cashbook where he was refunded, back to his loan.