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jessica-sturm
Level 2

COVID - 19

My business recently received a line of credit through our credit union as they were offering COVID - 19 Relief, this is not the ERTC or PPL Loans. The loan was for X amount and we can pull out of it at anytime however we do not know if we will pull the entire amount before the line of credit is closed. We will have to pay the loan back but not until next year I believe How do I properly record the line of credit and the pay back amount in  Quickbooks online? We also received a grant for disaster relief though the bank as well how do i properly record the grant?

Solved
Best answer May 27, 2020

Best Answers
ZackE
QuickBooks Team

COVID - 19

Hello, jessica-sturm. You've come to the right place. The Community is here to help.
 

You can record and track a line of credit by creating an account for the principle and one for interest. Once everything has been entered in your books, you'll be able to track what you pay back to your bank or creditor when a payment is made. Below are the steps to set everything up.


Create a principle account:

1. Go to the Gear () icon, then Chart of Accounts.
2. Hit the green New ▼ button
3. In the Account Type ▼ drop-down menu, use the Other Current Liabilities option.
4. For the Detail Type ▼, choose Line of Credit.
5. You can change the account name if you'd like to.
6. Select Save and Close. 

Create an expense account:

1. Click the Gear () icon, then Chart of Accounts.
2. Use the New ▼ button to begin creating a new account.
3. From the Account Type ▼ dropdown, pick Expenses.
4. Under the Detail Type ▼ area, select Interest Paid.
5. Enter a name for the account if you'd like to manually title it.
6. Hit Save and Close.


Now you'll have the proper setup to document your line of credit accordingly.
 

To make a record of the disaster relief funds you received from your bank, you can set up a grant account. Here's how:
1. From your Chart of Accounts, open the account creation window by using the New ▼ button.
2. Choose Other Income for the Account Type ▼.
3. Pick Other Miscellaneous Income for the Detail Type ▼.
4. Designate a name for the account if you'd prefer to.
5. Use the Save and Close button to finish.


Now your grant will have a place to be documented in your QuickBooks account. To input the funds, you can use the Plus (+) icon and then select Bank Deposit under the Other section. In the window that displays, you'll be able to fill out the form and make an entry in the account you created for it.

I'm also including a resource with more information for you about how to document and keep track of lines of credit: Set up and track a line of credit

If you have any questions, I'm just a post away. Have a wonderful day!

View solution in original post

2 Comments
ZackE
QuickBooks Team

COVID - 19

Hello, jessica-sturm. You've come to the right place. The Community is here to help.
 

You can record and track a line of credit by creating an account for the principle and one for interest. Once everything has been entered in your books, you'll be able to track what you pay back to your bank or creditor when a payment is made. Below are the steps to set everything up.


Create a principle account:

1. Go to the Gear () icon, then Chart of Accounts.
2. Hit the green New ▼ button
3. In the Account Type ▼ drop-down menu, use the Other Current Liabilities option.
4. For the Detail Type ▼, choose Line of Credit.
5. You can change the account name if you'd like to.
6. Select Save and Close. 

Create an expense account:

1. Click the Gear () icon, then Chart of Accounts.
2. Use the New ▼ button to begin creating a new account.
3. From the Account Type ▼ dropdown, pick Expenses.
4. Under the Detail Type ▼ area, select Interest Paid.
5. Enter a name for the account if you'd like to manually title it.
6. Hit Save and Close.


Now you'll have the proper setup to document your line of credit accordingly.
 

To make a record of the disaster relief funds you received from your bank, you can set up a grant account. Here's how:
1. From your Chart of Accounts, open the account creation window by using the New ▼ button.
2. Choose Other Income for the Account Type ▼.
3. Pick Other Miscellaneous Income for the Detail Type ▼.
4. Designate a name for the account if you'd prefer to.
5. Use the Save and Close button to finish.


Now your grant will have a place to be documented in your QuickBooks account. To input the funds, you can use the Plus (+) icon and then select Bank Deposit under the Other section. In the window that displays, you'll be able to fill out the form and make an entry in the account you created for it.

I'm also including a resource with more information for you about how to document and keep track of lines of credit: Set up and track a line of credit

If you have any questions, I'm just a post away. Have a wonderful day!

View solution in original post

jessica-sturm
Level 2

COVID - 19

Thank you so much for breaking this down for me,I feel so much better now that i know what to do. Thank You!

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