It's not a business transaction. She loaned the money to herself. In addition, she is taking an expense for the purchase of the inventory for the sub. That's where the expense is. If she were to take a loss on her other business then she would be taking credit for the expense twice as @Mike9241 says above.
This isn't messy. Unfortunately she loaned the money to herself. There is no business expense for that. (Even though she used it for a business purpose.)
@GGBJr
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