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Join nowhello - not sure how to enter this type of transaction:
1. gave a loan for $5000.00 John
2. John pays me $250 a month for 6 months
3. John pays me back the $5000 at the end of 6 months
i like to show this as some sort of temporary liability, i guess?
thanks a lot!
Solved! Go to Solution.
Thanks for getting back here in Community @rmp7345,
In QuickBooks Desktop, Loan can be an Asset account or Liability account. For the liability account, it is used when you're the one who loaned the money. As for what John_pero said since you're the one who gives a loan to your customer, you can use the Asset instead.
Let me walk you through the steps on how to record your customers' loan. Here's how:
Step 1: Create an Asset account.
To learn more about creating an account in the chart of accounts, check out this link:
Step 2: Write a check.
Once you receive the money loan from your customer, enter a check to record the transaction.
Step 3: Make a Deposit.
Once done, make a deposit to transfer the money to your bank account.
In case you'll need help on how to edit or delete an account, refer to this link: Create, edit, or delete an account in QuickBooks Desktop.
If you need further assistance, feel free to leave a message in the comment section. I'm always here to help. Have a good one!
Hello there, @rmp7345.
I'm here to help record a loan and its payment in QuickBooks Desktop. To start, we need to create a liability account.
Here's how:
Now that you have a liability account for the loan, issue a check for the loan.
After, record the customer payments.
If you want to keep track of your loans and be reminded about upcoming payments, you can check out this article for reference: QuickBooks Loan Manager.
Please don't hesitate to comment below if you have other concerns. I'd be here to assist you as soon as I can. Have a pleasant day!
@rmp7345 I sure hope you di not follow the instructions given out by @Rubielyn_J since those are for money you borrowed. The way you presented this, you are the lender and so you create a Current Asset for the $5000 loaned to John. Each month you receive $250 that is entered as Interest Income. When John pays you back the full $5000 you post it against the current asset. What was presented for you was in fact John's side
Thank you John-Pero - your understanding is correct. instead of liability, do i need to create an asset account?
Thank you Rubielyn_J - can we flip this around - i am loaning money to an individual
thanks,
Thanks for getting back here in Community @rmp7345,
In QuickBooks Desktop, Loan can be an Asset account or Liability account. For the liability account, it is used when you're the one who loaned the money. As for what John_pero said since you're the one who gives a loan to your customer, you can use the Asset instead.
Let me walk you through the steps on how to record your customers' loan. Here's how:
Step 1: Create an Asset account.
To learn more about creating an account in the chart of accounts, check out this link:
Step 2: Write a check.
Once you receive the money loan from your customer, enter a check to record the transaction.
Step 3: Make a Deposit.
Once done, make a deposit to transfer the money to your bank account.
In case you'll need help on how to edit or delete an account, refer to this link: Create, edit, or delete an account in QuickBooks Desktop.
If you need further assistance, feel free to leave a message in the comment section. I'm always here to help. Have a good one!
Rejeil_O - thank you !!!
Yes , as John said, a loan to someone else is an asset to you.
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