How to clear a loan that no longer needs to be paid

[Goebs]

Hello,

I hope some one can help as have paid out a Silver Chef kitchen item early, therefore  there is a balance of $544 left in the loan liabilty account. How do I clear this account.

Do I journal it out but to what account ?

? Historical Balancing

? Silver Chef Expense account, but this will be a credit on that account showing a total balance figure less than what I have actually paid.

? Retained Earnings

??

Much appreciated if some one could help

[Tracey_H · Accepted solution]

Hi @Goebs 

Thanks for your post. As we're not accountants we're not permitted to advise what accounts and tax codes should be selected when recording transactions. If you're not sure we do recommend speaking to your accountant to ensure the transaction is reported correctly.

Please let me know if you need further help.

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.