nav[aria-label="Primary Navigation"] { padding: 0; & ul { list-style: none; width: 100%; display: flex; flex-direction: row; justify-content: start; align-items: start; gap: 30px; padding: 0; & li { margin: 0; } & ul li { list-style: none; } } }

How do I make journal entry to record interest on bank loan

Margriet

How do I make journal entry to record interest on bank loan? The monthly payments are recorded in "banking" but that does not reconcile the liability account that I have created for the loan.

Find more posts tagged with

Accepted answers

redmx

Apologies - posted b4 I was ready.

Loan account Debit $800

Interest Expense Debit $200

Cheque Accounrt Credit $1,000

With a table mortgate the split between repayment on the loan account and interest will change with each payment , so these need editing every payment.

I use recurring journals for splitting things such as phone/internet between business/personal as well as receipts where there multiple splits and an invoce was no previously issued.

All comments

Margriet

Hi Jennie,

Thanks for your reply. As payments come out of my cheque account, I would have to record DR/CR journal entries. But how would I structure those?

Kind regards,

Margriet

jenniek

Hi @Margriet

Change the loan liability account to a credit card type - then you can process transactions against it and reconcile it like a bank account. Otherwise you would need to record a journal entry (DR & CR) in Accounts.