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msktradingpteltd
Level 1

When the company director makes repayment for his director loan, where can I post this entry in order to reduce the loan amount in the trial balance?

 
1 Comment 1
BushCPA
Level 1

When the company director makes repayment for his director loan, where can I post this entry in order to reduce the loan amount in the trial balance?

Hi msktradingpteltd,
You can either make a journal entry to record the receipt.
DR. Cash (or any account equivalent in your system that will reflect the receipt of the payment)
CR: Directors Loan

You need to know what was the original entry made to record the loan. ( This should be a receivable in general). and credit that account used to reduce the loan balance.

 

Or this one depends on how your receipt of cash is set up in the system. (Issue a receipt to record the loan)

Regards