Am I doing this right?

[k***@aol.com]

I am the bookkeeper of a National chapter of a non profit association
with various chapters around the states. Recently the decision was
made by the National Chapter for the State chapters to loan the
National chapter $1200.00 per each State chapter. This was for a buy
and sell business to bring in money into the coffers of the National
chapter. Most of the states paid except 2 states. National then
chipped in the $2400.00 to bring the total to the required amount.

This is how I booked the entry.

I made a liability entry on the National chapters books to record the
loan given to us. My question is this. Should I record the $2400.00
paid by the National chapoter also as a liability on National chapter
books? The $2400.00 came out of the National chapters bank account and
has been recorded on the cash side.

It baffles me a littile bit, any help to this question will do.

Bankye

[Kevin Miller]

I would not record a liablity on the books of the national chapter, you
can't loan money to yourself.

Probably something like this based on what you've said

Dr. Investment in x
Cr. Cash

or if you have just moved it to a seperate bank account for now..

Dr. Cash a
Cr. Cash b

[nilsson]

National Chapter -> State Chapter
State Chapters give $1200 per state to National Chapter
48 states x 1200 =3D =8057,600
2 states x 0 =3D 0
National Chapter gives =802,400
Total Fund =3D =8060,000
You can't pay yourself =802400 so treat the buy & sell business a/c as
a project
Loans from states to (buy & sell business a/c) =8057,600 CR
Loan from National to (buy & sell business a/c) =802,400 CR
Bank a/c for (buy & sell business bank a/c) =8060,000 DR
(being the monies put into a separate buy & sell business a/c)

The states and the national chapter when there money is paid back will
be the reverse journals to everything above. And if the money never
goes back, the states and national will have a bad debt to write off in
their profit & loss a/c.