Hi All, Since starting out I have made 6 bank transactions from my business current account to the two shareholders current accounts.
I wish to record these as directors loans, for which I have been advised to create a journal entry for each transaction.
This is how I have handled the loan payment:
- Journal for CR business current account & DR directors loan account (setup as a current asset account).
- 2. Then matched the bank transaction to the journal.
Then at year end I now need to repay the loan using dividends, there was enough profit to repay the loans made in the last FY, so now I need to pay down the loan and record the dividend. This is where I come unstuck? I've read lots of stuff about where this important transaction needs to sit.... Can anyone offer any guidance on this.
Your help is greatly appreciated.