UK How to categorise a payment made to cover drawings?

[Christian Cunningham]

Hi,

Recently made some drawings to buy items for a friend and I. He repaid my business account, but when I came to log an explanation for the payment (in MyBusinessWorks) I couldn't find a suitable category for it. What sort of category should this type of payment be categorised as?

Any help is helpful!

 

[Tyson]

Do you mean a loan?

If so, the initial withdrawal would be categorized as "Loans Receivable", an Accounts Receivable account. Credit "Cash" and debit "Loans Receivable".

When he repays the loan, credit "Loans Receivable" and debit "Cash".