Know the difference between Member’s Equity and net income to use the features of QuickBooks effectively. Member’s Equity is the starting and extra money investment to run the business. The net income determines the profit created from business operations, which are integrated back to Equity as an individual line.

What is members equity in Quickbooks

Members equity is the extra money that you put in your business for making it run properly. The other income which is being generated by the by the operations of the business then it is known as the net income which is being added separately as a balance sheet.

You might have the question that how the member equity can be correctly entered so for knowing it follow the steps below:

  • Open the personal bank account then make as an new entry as an increase.
  • Select the owner equity amount and then fill the overall amount in that.
  • If in any case you see that the overall balance comes in positive then you should make it decrease.

Entering Members Equity

You can enter the Members Equity through different ways in Quickbooks. Make Deposits option, however is one of the easiest method to use, you can go to the main screen and then to the drop-down menu. Now after reaching here, choose company’s bank account, in which the deposit was made by the member. Then add the amount that was deposited and also the name of the member who deposit it.

From drop-down menu click From account and then select the owner equity account. After doing this, click on Save and Close button, in order to record Members Equity deposit.

Dividing Equity in QuickBooks

Company that has investors or is run as the partnership, can track the equity of each person easily through QuickBooks. Equity of the company is equal to its assets minus the liabilities it have. Sources of equity is basically two, investment of money made by the partners and investors and profit and loss from business.

  1. Setting up the equity account for every single partner through QuickBooks chart of accounts. From the bottom left, in chart account button, select New. In this new window, you will see a drop-down menu, for the Type lists QuickBooks can create account for fixed assets, expense, equity, account payable, equity etc. Choose equity
  2. Type the of equity account so that it could be identified with the partner. Account could be labelled as partner’s equity or as partner’s capital
  3. For partner’s capital account, create the sub-account, so that the amount of investment made by the partner is recorded. This will track whatever amount of fund has been invested by the partner in company and what is the total investment’s amount

QuickBooks customer support team could be contacted by you anytime, in case you are seeking an information on this topic in detail. QuickBooks tech support team will help you in having better understanding of it. You can dial our to get in touch with QuickBooks Technical Support team.


  1. How can I calculate the Net income of an organization?

    The cost of items sold is subtracted from the organization’s revenue for a given duration to calculate the Net income. The cost of items contains all the expenses which take place in business like payroll, advertising, taxes, and rent.

  2. What do you mean by Owner’s Equity?

    Owner equity is calculated by subtracting liabilities from business assets and described in the company’s balance sheet. You can refer to Equity as the book value of an organization, which might vary with its market value.

  3. How can I know the member equity is entered correctly in QuickBooks?

    💠 Open your personal bank account.
    💠 After this, make it a new entry.
    💠 Choose the Owner equity amount.
    💠 Enter the overall amount in it
    💠 If they display a positive overall balance then you need to decrease it.

Further Reading