loan journal entries

I would prefer to handle the transaction directly through the vendor's account rather than using a journal entry.

• Navigate to the Vendor’s Profile:
  Go to the "Expenses" or "Payables" menu and select "Vendors."
  Locate and click on the vendor's name to open their profile.
• Apply the Loan to Outstanding Bills:
  Within the vendor's profile, you should see a section for "Transactions" or "Bills."
  Identify the bills that you owe to this vendor which total $300,000.
• Record Payment Using the Loan:
  Select the bills you want to apply the loan amount to (in this case, totaling $300,000).
  Choose the option to "Make payment" or "Pay bills."
  When prompted for payment details, instead of selecting a bank account, select "Loan from others" or the specific loan account you initially used to record the $300,000 loan.
• Verify and Save:
  Double-check the payment details to ensure the loan account is selected as the payment source.
  Verify the total amount being applied ($300,000) matches the bills selected.
  Save the payment.
• Review and Reconcile:
  After recording the payment, review the vendor’s profile and the bills section to ensure the transactions are accurately recorded.
  Reconcile your accounts payable to ensure the outstanding balances reflect the correct amount owed after applying the loan.
• Documentation and Reporting:
  Keep detailed records of the payment transaction for your records and future audits.
  Generate reports from QuickBooks Online to confirm that the loan application has been properly recorded and reflected in your financial statements.

By following these steps, you effectively record the application of the $300,000 loan directly through the vendor’s account in QuickBooks Online. This method maintains clear visibility of the transaction within the vendor’s profile and ensures accurate financial reporting. If you have any further questions or need clarification on specific steps, feel free to ask!

Thank you for your detail answer.  But I cann't choose "Loan to Others" as a payment account.  QBO only shows bank accounts as a payment account.   If I choose "Creat new account", i only can creat "bank or credit card" account. How do I choose payment account as "loan to Others"?

If its not allowing you, you can choose either way.

1. Journal Entry for Loan Application:

• Create a journal entry to properly reflect the application of the $300,000 loan towards the bills owed
• Debit the Accounts Payable account for the vendor by $300,000.
• Credit the Loan account (where you initially recorded the loan) by $300,000.

1. Adjust Bills in QuickBooks Online:

• Adjust the bills in QuickBooks Online to reflect the application of the loan amount
• Go to the Bills section.
• For each bill owed to the vendor, mark it as paid or adjust the amount due to reflect the application of the $300,000 loan.

1. Verification and Reconciliation:

• Double-check your journal entry and bill adjustments to ensure accuracy.
• Reconcile your Accounts Payable account to ensure the outstanding balances reflect the correct amount owed after applying the loan.

1. Documentation and Reporting:

• Keep detailed records of the journal entry, bill adjustments, and any communication with the vendor regarding the loan application.
• Generate reports from QuickBooks Online to confirm that the loan application has been properly recorded and reflected in your financial statements.

@AAAW 

No journal entry is needed.  Create a bank account in QB called 'Clearing Account'.  Transfer (New > Transfer) the amount of the bills from the loan account to the Clearing Account.  Then, pay the bills out of the Clearing Account. 

This could be the best way to deal with the situation.