There are times when the business may apply for a loan and this could be from a bank or individual.
How to deal with a loan
Create a new bank account and ente the required details under the account number and account name
You need to choose the loan account box as detailed below.
The opening balance will either be NIL (if this is anew loan and you have yet to receive the proceeds) or you will need to enter the balance as of the start date with Clever Accounts. Therefore, if you are starting to use Clever Accounts from the beginning of the financial year e.g. 6th April, the balance will be as of 5th April.
When the money hits the main bank account, you should explain the entries as a bank transfer from the loan account to the current account.
When dealing with the repayment of the loan, the process is very similar. You would create a transfer from the main current account to the loan account for the value of the repayment.
Any interest payments that are charged should be entered as bank payments from the loan account as and when they arise.
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