Hi there, confused2019.
Welcome to the Community. Let’s set up a liability account to track the loan and then create a journal entry to record the money spent.
Here’s how:
- Go to the Accounting menu on the left panel and pick Chart of Accounts to select the New button in the upper right hand.
- These actions will open the Account window.
- Choose Current liabilities/Non-current liabilities from the Account Type ▼ dropdown.
- For the Detail Type, pick Notes Payable.
- Enter a term that will identify the item. For example, Loan for a car.
- Input the full loan amount as a negative number in the Amount field.
- Hit the Save and close button.
To enter a journal entry:
- Tap the New menu or Plus icon in the upper left hand to choose Journal Entry under the Other section.
- On the Journal Entry page, go to the Account column and then enter the liability account on the first line.
- Then, input the loan amount in the Credits column.
- On the second line, choose an appropriate asset account from the Account dropdown and enter the same loan amount in the Debits column.
- Hit the Save button to keep the changes.
The next thing to do is to record a loan payment. For detailed instructions, follow the recommended steps in this article and perform Step 3: Set up a loan.
Reach out to me if you have further questions while working in QBO. I’ll pop right back in to assist further. Enjoy the rest of the day.
