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Rambo's avatar
Rambo
Contributing User
2 years ago

Loan and Repayments

I have one question and I belive it's little tricky.

 

I have one company call (ABC Ltd) and I owe $200,000 to XYZ Ltd for using their Trading Name. A third person (Mr. X) has been paid this licence fee to XYZ Ltd on behalf of ABC Ltd (Directly to XYZ Ltd).

 

ABC Ltd will pay off the loan on a monthly basis to Mr. X from ABC Ltd' bank account.

 

How can I record these transactions in ABC Ltd books?

 

Points.

  • Mr. X directly paid to XYZ Ltd ( So no payment was received to ABC Ltd bank account)
  • But repayment to Mr. X is debiting from ABC Ltd bank account on each month.
  • 5 years licence fee paid in advance to XYZ Ltd ( How to record this prepaid transaction).

 

I hope someone will help me with question.

 

Thanks in advance :)

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  • ChrisMYOB's avatar
    ChrisMYOB
    Former Staff
    2 years ago

    Hello Rambo 

     

    Welcome to the Community Forum

     

    You can use AccountRight to record the receipt of a loan and to record the repayments. Because there are lots of loan types, interest rates, terms and conditions, you might need help from your accounting advisor to determine the best way to set this up for your loan.


    I have attached our Help Article on loans and repayments which will step you through how to set it up within the software.