If you’re setup to loan manager, the system will help you calculate the payment including the compounded interest and principal installments. This calculation is based on the information you’ve enter when setting up loan manager:
• Loan Date
• Loan amount
• Due Date of Next payment
• Payment Amount
• Interest rate
Reviewing your loan information and editing these loan details (if necessary) would be the first thing to do. If everything was set up correctly but still having error while processing the loan payment, I’d recommend running the Verify Rebuild Utility. This makes the program self-identifies the most commonly known data issues then self-resolves these issues afterwards.
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If this happened over more than this fiscal year, that could be an issue. Interest paid is an expense, so the interest you should have paid last fiscal year would reduce taxable net income - might be worth doing an amended return to get some refund back.
At any rate, assuming the loan did extend into previous years
from the loan company find the end of year balance for each of those years, and the current loan balance
In take the loan balance for the end date of the year being worked on, subtract it from the loan company balance for that same end of year date. Then do a journal entry, back dated to the end of that year
debit interest expense, and credit loan liability
when you get to this year, of course you use the current date for the journal entry
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