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I routinely have issues with the way the line of credit works in QB online. Perhaps it's just me. Here's the quick situation I have now.
I made a payment from checking account to line of credit account. For simple math, we'll make this easy. Let's say the payment was $100. $30 was principal, and $70 was interest. When the checking account syncs, it shows $100 debit. I created an expense for $100 and put $30 in an account of Line of Credit and $70 in an account of LOC Interest.
However, when the LOC syncs, it shows $100. BUT the balance is only going down by $30 since that's the principal. So what do I do? The LOC account in QB doesn't find the expense I entered to match up because it's only $30 and the LOC sync shows $100, which isn't accurate.
Am I doing this wrong? I'm confused. Thanks for the help.
Solved! Go to Solution.
I noticed the same thing.
I also split the debit in the checking account, with the interest portion going to the interest expense and the rest going to the LOC liability account.
I don't think this is a QBO problem. This is how the bank sends the data to QBO.
There is very little activity in the LOC account, so I don't need to use the bank feed (what you are calling the "sync") for the LOC. I just ignore it. The LOC balance is correct because of the aforementioned split entry, which correctly reduces the LOC balance.
I noticed the same thing.
I also split the debit in the checking account, with the interest portion going to the interest expense and the rest going to the LOC liability account.
I don't think this is a QBO problem. This is how the bank sends the data to QBO.
There is very little activity in the LOC account, so I don't need to use the bank feed (what you are calling the "sync") for the LOC. I just ignore it. The LOC balance is correct because of the aforementioned split entry, which correctly reduces the LOC balance.
So each time you transfer money from lets say an operating account, do you manually create the principal amount in the LOC's register?
Hello, @JennyP714.
Before going into detail, I'd like to ask if you mean to transfer money between two accounts?
If so, you can use the Transfer option in QB Online to transfer funds between bank accounts.
Here's how:
If the steps above are effective, you can refer back to this detailed article: Transfer funds between accounts.
I look forward to chatting with you soon. Happy Tuesday!
How did you set up your LOC to begin synching? Did you just designate it as a credit card since that's the only option that's a liability?
@chuck27p forgot to tag you. did you set up the LOC initially as a credit card so that you could synch?
Hi @christine4form,
As the user @Malcolm Ziman stated above, he ignores these bank feeds since they're already recorded in QuickBooks Online (QBO).
To start tracking a line of credit in QBO, you'll need two accounts. One is for the principal, and the other is an expense account for the interest.
Follow these steps to create an account for the principal:
Here's how to create the expense account:
Take a look at this article for additional information on this process: Set up and track a line of credit.
Don't hesitate to drop a comment below if you have other questions about tracking LOC in QBO. I'll be sure to take care of it.
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