This is a common question, but it's not really a Cheqbook one, it's actually an accounting question we'll be happy to answer.
When an owner buys something for the business using their own cash (or personal checking, personal credit cards or other resources) that purchase is an owner contribution. The expense needs to show on the Profit & Loss, but you have to record that expense somewhere, and the question is where?
This is where small business owners can struggle if they have limited accounting training. They realize they can't record it in the company checking account (the most common type of account) because, well, it wasn't paid from that account.
The general rule when the Owner Pays by Cash, Personal Checking, or Personal Credit card is as follows: you go to an account called "Owner Capital Contributions" which is part of the "Equity" group. Record the expense there manually (since it's not going to be downloaded from a bank), noting the date, payee, expense account, and amount. Always save the receipt!
The above screen shot shows an example. On July 4th, 2012 the owner paid $437.75 for a company auto repair, which was properly recorded in the Owner Capital Contributions account. It increased the total amount this owner had historically contributed to their company to $2,711.60.
Note that if you're mixing business and personal expenses in one Cheqbook company and you paid a business expense from a linked personal bank account, then this rule doesn't apply. Categorize the expenses from that linked personal bank account between business and personal categories normally.