My company has 2 sets of books.

Company 1 is where we receive sales. Company 2 is where we have our expenses: wages, utilities, etc. When company 1 transfers money to company 2, is that considered notes payable to company 1? Or is it still considered as Sales?

Ex.

Company 1 receives 100k. Company 1 transfers 50k to company 2.

Company 2 debits cash and credits sales? or debits cash and credits notes payable to company 1?

And what does company 1 do? Credit cash.. and debits notes receivables?


Both company's are the same company. Company 1 will never receive the money back and Company 2 will not pay back company 1...

Any feedback is greatly appreciated. Thanks