How to Record Equity in Manager.io?

In this guide you will learn how to record equity in cash. You could also record equity in the form of other assets like inventory items, fixed assets, or land, but the easiest way is to receive equity in cash.

Before making any equity transaction, you should know how many sub accounts does a capital account have. To know this, go to Settings.

Then click on Capital subaccounts.

You can see three accounts in capital subaccounts' page. Each account has a self explanatory name. But it doesn't matter which sub account you use for what purpose. It is better to use them according to their names. Use Drawings subaccount when the owner or shareholder withdraws funds from the business. Use Funds contributed when the owner or shareholder adds funds to the business and use Share of profit when profits are distributed.

You can add new a new subaccount by click on New Subaccount. It requires only a name. Or, you can modify existing subaccounts by clicking on Edit. 

To record equity contribution by owners or shareholder, go to Receipts.

Then, click on New Receipt.

It will open new receipt's page. To make things easier, we will only talk about fields and options that are necessary for this transaction.

Date: It will automatically select today's date based on your computer's date. But, you can select a past or future date too.

Reference: This is optional. If references are mandatory by your business, you can enter it in this field or you check its option for an automatic reference. 

Paid by: This is also optional. It wouldn't affect you transactions. Select other from the list and write a Robert in the field. 

Received in: This field is important. Select a bank or cash account from the list of your bank & cash accounts.

Description: Write a description if you want to, otherwise leave it empty.

Account: Search for capital accounts and select it. When you select capital accounts, another field appear where you can select capital account.

Capital Account: Search for the specific capital account and select it. When you select a capital account, anther field will appear where you can select sub account.

Sub account: Select a sub account for the transaction. In this case it would be Funds contributed, because the business is receiving funds from the owner or shareholder.

Column - Description: Activate this option. And the line description will appear after Account. Fill the description with some important information that is related to the transaction. Or, just use it as memo for the transaction.

Amount: Enter the amount in this field. You can break the amount in multiple lines by clicking on Add line.

Add line: You can add multiple lines in the same receipt to receive cash from multiple accounts or people, in this case from multiple capital accounts at the same time.

Create: Then, click on Create to save this transaction. Alternatively, you can click on Create & add another to keep adding more receipts.

Receipt Document: When you click on Create a receipt document will be created. 

Summary: Let's go to Summary page and see the effect of this transaction.

Both assets and equity have an increase by the entered amount and it is shown in the Summary page.

Using the above process you can receive equity from other partners or shareholders, too. Remember, it is better to receive equity in cash, at least inside the accounting system. You can write a memo or a note on how the equity was contributed like in the form of fixed assets, but you recorded it in cash and later purchased the fixed assets.