It's nice to see you here in the Community, @Stan Audette. I'm here to provide info on how you can record a simple loan interest account in QuickBooks Online (QBO).
Thanks for trusting QBO as your accounting partner. I also appreciate you providing detailed information about your loan concern. To help you with this, you'll need to create an Asset account for the loan first. Here's how:
- Navigate to the Settings menu and select Chart of accounts (ensure that you're in the Accountant view).
- Next, select New and click Assets.
- Then, in the Save account under and Tax form section field, choose Loans to Others.
- On the Account name field, enter the name of the loan account.
- Once done, select Save without entering an opening balance.
After that, you'll need to create a check for the loan. Ensure to select the account you used to fund the loan in the Bank Account section and choose the asset account you've recently created in the Category field.
Then, use the Bank deposit feature to record the loan payments. You'll have to manually calculate the interest and add it to the second line of the transaction. Make sure to assign it to the account you use to track interest income and enter the correct amount.
For reference, feel free to check this article: Track customer loans in QuickBooks Online. This also includes steps in creating a recurring invoice transaction for monthly loan payments.
I also recommend reaching out to your accountant to have additional guidance in creating simple interest loan accounts in QBO. This is to ensure you'll record everything correctly and to avoid messing up your books.
You can also run a report to track loan transactions you record in QBO. To do so, simply go to the Reports menu and search for Transaction Detail by Account.
Please let me know how this goes and leave a reply below if you have additional questions about recording loans in QBO. I'm just around the corner to help. Have a good one and keep safe.
