how to account for a loan in quickbooks

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Quickbooks will prompt you to complete a few additional fields in the鈥淎ccount details鈥?/strong>area. In the first field, enter the account for the loan as well as the amount of your payment. In the second field, enter the expense account used for the loan鈥檚 interest.

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Select Journal entry. On the first line, select the liability account you just created from the Account dropdown. Enter the loan amount in the Credits column. On the second line, select the appropriate bank account from the Account dropdown. Enter the same loan amount in the Debits column. This puts the entire loan amount into your bank account.

Just create a liability account and you are all set to record a loan payment in QuickBooks software. A liability account enables you to see interest payments, cash, and non-cash asset on the same account. Also, saves lots of your energy consumed while finding out the transactions.

With QuickBooks as your accounting application, you can swiftly set up a liability account for both short-term and long-term loans. This, in turn, helps to record and make track of the loan deposit amount and all loan repayments.

Hit the account for Expense. Try to record the loan interest. Also, specify the loan interest amount. Provide the extra fee on the subsequent lines. Finally, just choose Save and Close button.