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Dustys
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10 months ago
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Recording a loan not paid directly to supplier used for previously purchased equipment

Hi

Company bought some equipment and paid for it with company money in June and July.  Then got a loan in August to cover these costs.  I know how to create a bank loan account and a journal entry for the assets when a bank loan is paid directly to a supplier, but when the loan is cash into our account after equipment already paid for I'm confused, have not done it like thi before.

I know I can't set up loan account as credit card and put payment of equipment against it because we're not using bank feeds for the loan bank account and the equipment was already paid for out of the company main bank account in June/July.  We use bank feeds for all the main accounts, not loan accounts so I can use bank feeds for the repayments etc.

I'm think I'm over thinking this... is it as simple as creating a normal loan liability account, then in bank feeds use 'receive money' to record the cash coming into the bank account recording it against the newly created loan liability account and then record loan repayments against that account like every other loan?  Then should I be using an asset account in purchases when recording the equipment invoices instead of the usual journal entries for the equipment/assets like you do when bank pays supplier directly?

Thanks in advance.

 

  • Hi Dustys,

     

    Thank you for your post. I'd like to extend you a warm welcome to the Community Forum. I hope you find it a valuable resource.

     

    Regarding your concern about how to enter and what account you should use, I highly recommend speaking to your financial advisor or your accountant. Please read through this Help Article on Loans and Repayments, which has detailed information to guide you with this.

     

    I hope this helps, and please let us know how you go, as we are happy to help further.

     

    Cheers,

    Princess

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  • Hi Dustys,

     

    Thank you for your post. I'd like to extend you a warm welcome to the Community Forum. I hope you find it a valuable resource.

     

    Regarding your concern about how to enter and what account you should use, I highly recommend speaking to your financial advisor or your accountant. Please read through this Help Article on Loans and Repayments, which has detailed information to guide you with this.

     

    I hope this helps, and please let us know how you go, as we are happy to help further.

     

    Cheers,

    Princess