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Hi. Great Question. You lower the Loan Payable when you pay back the line of credit:
For example, paid $450 as monthly payment on loan:
D/R Loan Payable (principal amount paid)
D/R Interest Expense (interest part of what paid)
I think I know what is missing -
The loan to the shareholders should be:
D/R Receivable (Loan to Shareholder)
C/R Cash (Bank)
When shareholder pays you back:
C/R Receivable (Loan to Shareholder)
Loan to Shareholder ='s Due from Shareholder - both a Receivable account.
Hi. If you are satisfied with the response and do not have any questions, a positive rating is very much appreciated. Best Regards.
Hi. If you have any questions, please let me know. If not, a positive rating or an acceptance of the answer is very much appreciated. Thank you.