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Re: Loan (Long term Liabilities) & principal payment

Are you a C corporation or a multi shareholder S Corp? Is the private money from a shareholder or other member/owner of the company? Even a multi member LLC can borrow private money from one of the members and this is treated exactly as if it were borrowed from a real bank. What you described is the same as you would have done if the deposit you banking came from aoan at JPMorgan/Chase. So yes you have it correct. Principal portion of any loan payment as a line item is to the actual liability and reduces it accordingly