Transfers
Why transfers are not sales or expenses
Understand why moving your own money between accounts should be recorded as a transfer.
A transfer moves money between your own business accounts. It does not create income or cost by itself.
Examples of transfers
- Cash deposited into Bank.
- M-PESA moved to Bank.
- Bank withdrawal into Cash.
- Cash moved into M-PESA float.
Why this matters
- If you record a transfer as a sale, income becomes too high.
- If you record a transfer as an expense, costs become too high.
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