Full question:
If I comingle funds in one account for two businesses and proceed to conduct transactions for both, how can I properly account for each individual business transaction to meet legal and accounting principles?
- Category: Records
- Date:
- State: California
Answer:
Using one account for two businesses complicates accounting and can lead to errors. It's advisable to set up separate accounts for each business to maintain clear financial records. This separation helps avoid mistakes and ensures compliance with basic accounting principles. While using one account isn't illegal, it can create issues during tax time, potentially leading to complications with the IRS. To simplify your accounting, open another account for one of the businesses and keep funds separate.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.