Incorrect postings to Directors Loan Account

As a new user and a non financial person. I think I have posted to the Directors Loan Account incorrectly. I paid money into the business to get it started and tagged the transaction from the current account to the directors loan account. All these transactions are showing as debits on the DLA when I now understand they should be showing as credits as the company will owe me the money. I would appreciate someone confirming this is in fact not correct and any advise in correcting the transactions.

I think Quick File is great, unfortunately when it comes to accounting I am not.

Thanks to anyone who can help

One thing that is very counter intuitive in the world of double-entry accounting is that in the context of bank accounts, debits and credits are reversed from how we normally interpret them. If you’ve got a string of bank transfers to fund the company along with various expenses you have covered “out-of-pocket” then the DLA account should be in the red. This sounds exactly like what you have described and is how it should be.

The company owes you money so on the balance sheet that overdawn DLA account will show as a liability until the money is paid back.

Hope that helps, let me know if you need any further assistance.

Glenn, really appreciate your prompt response and it does now sound correct as I have a debit balance on the DLA and this shows on the Green side of the Balance Sheet. Thank you.

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