0:00 Intro 0:37 Concept Example 1:59 How to Start - Setting up the Chart of Accounts for the Loan & Interest 7:27 Entering a beginning/opening balance for the loan (if applicable) 14:40 STEP 1 Record the Loan Deposit (if applicable) 17:32 Recording a Repayment the WRONG Way 19:31 How to Fix a Loan Repayment that's Already Entered 20:42 STEP 2 Record a Loan Repayment the RIGHT Way How to manually enter the loan & repayment so you don't have to wait for them to appear on the Bank Feed: 23:42 STEP 1 Record the Loan Deposit Manually (if applicable) 24:05 STEP 2 Record a Loan Repayment Manually 27:16 Match to the Bank Feed (if you entered it manually & you also use the Bank Feed) 28:27 Summary 29:18 Results on the Register and Reports
Can you please show a video of the line of credit that is connected to the Quickbook Online account? It appears in my bank feed.I am confused about how to get an entry on QuickBooks for interest paid for a line of credit. What does a chart of account for a line of credit look like?
You can still think of a line of credit as a loan. It's the same steps, but when you create the category, it will be a Liability type (current if repaid within a year) and the Detail type/Tax form section should have Line of Credit. If it doesn't then select Other Current or Other Long-Term Liability. The important part is that it's created as a liability category. If the line of credit account is in your Bank Feed, that may be hard to track since you have to show the payment as a transfer from your checking. QBO thinks it's a bank account and when you enter it the loan repayment it won't show correctly on reports. You may want to consider disconnecting it from the Bank Feed. This way on your checking Bank Feed, the repayment can be categorized like normal as shown in the video.
What if the loan place doesn’t show the interest they base it off monthly terms? So say I got a loan for $150,000 but the full balance of the loan for a 15 month term makes my loan total $205,000 how would I put this in?
The difference of $55,000 should still be counted as interest. You can divide that additional amount evenly by the 15 month term. The answer you get is your interest portion when splitting the monthly loan repayments. With these type of lenders, some of them will show a different principal balance when you log in to the loan account since they usually track things differently. However, accounting-wise that extra $55,000 is treated as interest. It is still good to confirm this with your accountant since they know your business.
0:00 Intro
0:37 Concept Example
1:59 How to Start - Setting up the Chart of Accounts for the Loan & Interest
7:27 Entering a beginning/opening balance for the loan (if applicable)
14:40 STEP 1 Record the Loan Deposit (if applicable)
17:32 Recording a Repayment the WRONG Way
19:31 How to Fix a Loan Repayment that's Already Entered
20:42 STEP 2 Record a Loan Repayment the RIGHT Way
How to manually enter the loan & repayment so you don't have to wait for them to appear on the Bank Feed:
23:42 STEP 1 Record the Loan Deposit Manually (if applicable)
24:05 STEP 2 Record a Loan Repayment Manually
27:16 Match to the Bank Feed (if you entered it manually & you also use the Bank Feed)
28:27 Summary
29:18 Results on the Register and Reports
Can you please show a video of the line of credit that is connected to the Quickbook Online account? It appears in my bank feed.I am confused about how to get an entry on QuickBooks for interest paid for a line of credit. What does a chart of account for a line of credit look like?
You can still think of a line of credit as a loan. It's the same steps, but when you create the category, it will be a Liability type (current if repaid within a year) and the Detail type/Tax form section should have Line of Credit. If it doesn't then select Other Current or Other Long-Term Liability. The important part is that it's created as a liability category.
If the line of credit account is in your Bank Feed, that may be hard to track since you have to show the payment as a transfer from your checking. QBO thinks it's a bank account and when you enter it the loan repayment it won't show correctly on reports.
You may want to consider disconnecting it from the Bank Feed.
This way on your checking Bank Feed, the repayment can be categorized like normal as shown in the video.
What if the loan place doesn’t show the interest they base it off monthly terms? So say I got a loan for $150,000 but the full balance of the loan for a 15 month term makes my loan total $205,000 how would I put this in?
The difference of $55,000 should still be counted as interest. You can divide that additional amount evenly by the 15 month term. The answer you get is your interest portion when splitting the monthly loan repayments. With these type of lenders, some of them will show a different principal balance when you log in to the loan account since they usually track things differently. However, accounting-wise that extra $55,000 is treated as interest. It is still good to confirm this with your accountant since they know your business.