How do I record loans and repayments?
Businesses tend to take short and long term loans from banks or financial institutions based on their capital needs or current requirements. Zoho Books lets you record the loans received and repayments made to ensure you’ve kept a track of them. Here’s how you can:
Record Loans Received
To track the loans you have received, you should first create an account to record your loan and then record the transaction. To create a new account:
- Go to Accountant > Chart of Accounts in Zoho Books.
- Create a new account by clicking + New Account.
- Select the Account Type as Other Liability (or any other liability account based on loan received).
- Enter a suitable account name, let’s say Loan.
- Provide a short description, if necessary and click Save.
Once you receive the loan to your bank account, here’s how you can record it:
- Go to the Banking module and select the bank account to which you received the loan.
- Click the Add Transaction drop down and under Money In, select Deposit from Other Accounts.
- Enter the Date, Amount, and other relevant details.
- Select the From Account as the Loan account you had created.
Record Repayments Made
To record the repayments you’ve made:
- Go Purchases > Expenses in Zoho Books.
- Create a new expense by clicking + New in the top-right corner.
- Select the Expense Account as the Loan account you had created.
- Enter the Date, Amount, Paid Through Account and other relevant details.