We are a multi-member LLC construction company. I do all the administration work and my two partners do all the construction work along with three other guys paid as 1099 contractors.
Each member invested a third of the $250 for state filing fee and local builder permit. How do I book this?
Every other week I invoice builder; builder pays invoice with a check; I deduct the amount paid to our subcontractors and cost of business insurance from that check; split the remainder between the two partners that did the work.
I book the customer payment a DR to bank and CR to A/R. The payments to our subs a DR to COGS: Subcontractor Expense and CR to bank. The payments to members a DR to Member Equity: Distribution and a CR to bank. The payments for Business Insurance a DR to Insurance Expense and CR to bank. Is this correct?
The two construction worker members have purchased big-ticket items used solely for our business (ie. chainsaws, hydraulic jacks, etc) with personal money. Also they use personal money occasionally to buy miscellaneous job materials (ie. nails, screws, etc). How do I book those types of transactions?
We are just starting out and are having to get caught up on personal expenses so can't really afford a CPA at this time. I need to prepare taxes and want to ensure that I am doing things the correct way.
Multi Member Llc