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Purchase of New Asset (Condo for Office use) on Loan?
How can I pass journal entry for this.
I appreciate you for reaching out here in the Community, @Hetavi Thakkar. I'll share some information about recording a loan for purchasing new asset in QuickBooks Online(QBO).
Please keep in mind that the following instructions only cover the essentials of how to set up asset loans. When determining the initial value of a purchase, a lot of factors are considered, including the trade-in, down payment, fees, taxes, and so on. Consult your accountant for advice on how to account for these factors.
To record a loan for purchasing a new assets, you'll first need to set up a liability account. Depending on the repayment time frame, chose either Current Liability or Long term liability.
In case you're going to choose Current Liability, please know that you'll need to pay it in full within one year. On the other hand, Long-term Liability has to be paid for more than one year.
Once you're ready, you can now proceed to set up a liability account for a load. To begin, these are the steps:
Now that you've already created an account for the loan, you'll need to create a journal entry to apply the loan to the correct asset accounts. To begin, here's how:
You can refer on the example below.
Once again, I recommend reaching out to your accountant. This way, they can provide you with the best possible option to do this.
Additionally, I'll be leaving these articles for future reference:
If you need help with performing specific features in QuickBooks, you can always reach out to us here in the Community. Rest assured, we are always ready to assist you. Keep safe and stay hydrated!
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