Line of Credit Conversion

Thank you for posting here in the Community, @Zoraida_L45. I'll show you the steps to create a journal entry and show the line of credit conversion into a loan on QuickBooks Desktop.

Yes, you can create a journal entry, as also mentioned by Rainflurry above. I'll show you how:

1. Select Make General Journal Entries from the Company menu.
2. To create your diary entry, fill in the fields. Then, double-check that your debits and credits are equal.
3. Choose the Account.
4. Under Debit, debit the line of credit, and credit the new loan.
5. Click Save & Close or Save & New.

Check this article for more information on creating a journal entry: Create a journal entry in QuickBooks Desktop for Windows or Mac.

I'm also adding this article as your reference in tracking your Loans in QuickBooks Desktop: Manually track loans in QuickBooks Desktop.

You can click the Reply button below if you have additional questions in creating a Journal Entry in QuickBooks Desktop. I'll be around to help.

I was watching videos on how to open loan account and post a payment on QB and it prompted another question. If I do this do I still need to also create a journal entry tying it to the fixed asset or does it not matter?

Hi there, Zoraida_L45.

I appreciate you for coming back to the thread to add clarification about recording loan entries. Let me provide extra details about the said loans and ensure you can record them accurately in QuickBooks Desktop.

There are Cash and non-cash when setting up accounts for your loans and manually tracking them in QuickBooks Desktop. With this, recording Non-cash loans need to create an account type named Fixed Asset. This is for items that have useful value for more than a year (vehicles, buildings, and so on).

I recommend consulting an accountant to assist you further in recording the loan entries to ensure your records are in shipshape. They can also provide suggestions about creating a journal entry that is associated with the fixed asset.

You can open this article to see additional details on how tracking loans works in QuickBooks: Manually track loans in QuickBooks Desktop.

Lastly, you may refer to this article to see some details on how Accounts Payable is used to track the money you owe your vendors in QBDT: Accounts Payable workflows in QuickBooks Desktop.

If you have any other concerns or questions about managing a loan, just tag my name in the comment section. I'll get back to you as soon as I can. Stay safe.

@Zoraida_L45 

It doesn't matter.   

Hello Rainflurry,

I have reviewed the solution you’ve shared and it's correct and accurate. Thank you for sharing your inputs to help address the issue.

We love to see members supporting one another! Have a great day.