You can use AccountRight to record the receipt of a loan , and to record the loan repayments. This is a basic example so you'll probably repayments. Because there's 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 specific circumstancesloan. This example assumes your ongoing loan repayments and interest charges are known at the outset. To accurately track your loan balance, you'll need to know: - the initial loan amount
- the value of your repayments, and
- the repayment breakdown (how much of the repayment reduces the principal, and how much relates to interest charges).
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| The example below describes setting up a loan where the loan amount is received by you. If your situation is different – for example, the loan amount isn't received by you but is used to directly pay out a creditor – you'll need to consult your accountant for the appropriate accounting and tax treatment. If you're lending money to an employee, see Wage advances and employee loans. |
Let's step you through setting up a basic loan. UI Expand |
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title | 1. Create a liability account for the loan |
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| | ui-1. Create a liability account for the loanYou need a liability account to represent the loan. When the loan is received you'll allocate it to this account. - Go to the Accounts command centre and click Accounts List.
- Click the Liability tab then click New.
- For the Account Type, choose Other Liability.
- Specify an Account Number that suits your account list.
Enter a suitable Account Name. Here's our example: Image Added UI Text Box |
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| Will you be setting up a bank feed for the loan account? You'll need to set up the above liability account with the Account Type of Credit Card to be able to associate it with a bank feed. |
- Click OK.
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title | 2. Record the receipt of the loan |
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| | 2. Record the receipt of the loanWhen you receive the loan, use a Receive Money transaction to enter it into AccountRight. Here's how: - Go to the Banking command centre and click Receive Money.
- In the Deposit to field, select the bank account that the loan money was deposited into.
- In the Amount Received field, enter the loan amount.
- In the Acct No. column, select the liability account created in the previous task.
- In the Tax/GST column, specify the N-T (No Tax/Not Reportable) tax/GST code. Here's our example:
Image Added - Click Record.
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title | 3. Record the loan repayments |
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