Question asked by Jill Wyeth 7 years ago
Ive used a contractor for some work and paid them in cash , I've raised a a bill for them and attached their invoice. Do I need to raise a money out entry to show the cash being withdrawn from the bank account ??
advice pls
Hi Jill,
If you have already raised the bill then you do not need to do a "money out" transaction as well as this would cause a duplication. At this point, you would need to allocate a payment to the bill.
If the money was withdrawn directly from your account and used to pay the contractor then applying the payment method from your bank account will then match the statement, which will greatly help when reconciling in the future.
Alternatively, if the contractor was paid from money that was loose (petty cash), hence there would be no obvious trail from your bank account, then I would recommend creating a new bank account with the "Petty cash" type and allocating this bill & payment from here.
If this raises further questions, do let me know so I can elaborate further?
Thanks, Theo
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