Hi, the marketing company I work for have set up a new company to act as a sales arm. They've paid an amount out of the company bank account in order to create the limited company. Where is this posted in the ledger?
I assume you mean both the payment out of the existing co and the payment into the new co?
This all depends on the terms under which the payment was made.
If the existing co does has shares in the new co, then you could treat the payment out of the existing co as being an investment, so you would post to one of the Asset codes on the balance sheet. The payment into the new co would go into paid up share capital.
If the money is to be paid back, then it needs to go into the Other debtors in the existing co or setup a new debtors code for the loan and then in the new co it needs to go into the creditors section of the balance sheet or if you have a section for loans under and over 1 year.
It really depends on the purpose of the payment, so clarify that first then come back and let us know as more info the better.
My points above are only guesses based on the info you have given so far, so please dont rely on them as I do not know the full picture.
