We have just set up our Ltd company.
I will be selling some existing computers , wholly for cash to the company.
I’ve found a previous thread which showed journal entries should be as follows:
Nominal code Description Notes
(0030) Office Equip To: (3000) Ordinary Shares On Incorporation
(1201) DLA From: (00030) Office Equip On Incorporation
Why is the Description To: (3000) Ordinary Shares and not To: (1201) DLA.
If company is paying cash then just book normal purchase and mark it paid from bank/cash. no need of journal
Thanks for the reply. I probably did not explain myself adequately. The computer is currently owned by me (as director) and plan to sell it to the company “market value”.
As the Ltd company has just been incorporated and has no cash, I will need to use the DLA. I am just intrigued why on the example of journal posting I found on this forum, (3000) Ordinary Shares was used as the description. I would have thought it should have been (1201) DLA.
I fully appreciate that the two nominal codes used were correct, just the description narrative seemed odd to me.
Generally it is DLA a/c unless item introduced is treated as consideration for capital. In your case DLA a/c will do
That’s great. Thanks for you help