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maddyt
Level 1
posted
‎May 11, 2020 10:54 AM
last updated ‎October 05, 2020 7:15 PM

How to record employee loans to company that are paid back immediately?

We are a small (and brand new) company.

 

Frequently the owner / president will insert temporary funds into the company to cover payroll (including his own) and credit card payments while we wait for payment from clients. These have always been repaid in full within a month.

 

While I am less concerned with how these balance out, Quickbooks banking sees them as credits and debits (spent / received). Within Quickbooks, what is the most straightforward and simple way to account for these changes to the account balance? (Step-by-step instructions as I am still new to navigating the program.)

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1 Comment 1
Rasa-LilaM
QuickBooks Team
QuickBooks Team
‎May 11, 2020 01:37 PM

How to record employee loans to company that are paid back immediately?

Hello there, maddyt.


Welcome to the Community. Let’s create an asset account to track the loan and then write a cheque to record it.

 

Here’s how to set up the account.

 

  1. Choose the Gear icon at the top to choose Chart of Accounts.
  2. Tap the New button in the upper left.
  3. Set the Account Type to either Other Current Assets or Current Assets.
  4. Create the Other Current Asset if the loan is to be repaid within the current financial year.
  5. Choose Other Asset if the loan will be repaid after the current financial year.
  6. Pick Loans to Others as the Detail Type.
  7. Add a term in the Name field that will identify the account (customer loan).
  8. Select Save and close without entering an opening balance.

Check out these articles to learn more on how to set up an account as well as selecting the correct category:

 

To create a cheque:

 

  1. Tap the New menu and select Cheques under Suppliers.
  2. Choose the account used to fund the loan (Example: Checking or Money Market) for Bank Account.
  3. Enter the account used to track the loan as the offsetting account.
  4. Type in the amount and then hit Save and close.

To deposit:

 

  1. Go to the New menu to select Bank Deposits.
  2. Make sure the appropriate Deposit to account is selected.
  3. In the Add funds to this deposit section, fill in the field boxes and the amount of the entry.
  4. Click Save and close.

I'm also adding a link where you can access our self-help articles and online tutorials. Each one helps you get acclimated to the product's features and processes.

 

Reach out to me if you have any other concerns or questions. I’m more than happy to answer them for you.

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