How to Record Loan in Sage 50
“Recording a loan in Sage 50 is essential for businesses that need to borrow money. To record a loan, you must first create an account under the Chart of Accounts section and categorize it as either Long-Term or Short-Term Liability.”
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Sage 50, beyond doubt, is an essential tool for businesses and accounting professionals. Within a short span of time, it has become one of the most popular accounting software worldwide. With the improved features and ‘easy-to-operate’ tools it offers, Sage 50 has helped businesses streamline their accounting activities, with the desired efficiency. One such feature embedded in this software is the easy recording of banking transactions and loans.
If you have not yet tried recording loans in Sage 50, we are here to help! All you need to do is to go through this blog. Here, we will look at a step-by-step approach to record loans in Sage 50. We will also discuss other related matters.
Read More : Set up Late Interest in Sage 50 Accounting
Here we go!
What is the Procedure to Record Loans in Sage 50?
If your organization has a bank loan, you need to record this to ensure the accuracy of your accounts. You can perform this by recording the receipt of the said loan, the repayments due to make and interest charges, if any, that needs to pay. We will discuss all these steps in the sections below-
How to Create a Loan Nominal Ledger Account?
- Open Sage 50 Accounts
- Click Settings
- Locate the Financial Settings section
- Click on Chart of Accounts
- Now click on the New Ledger Account tab
- Fill in the relevant information in the following fields-
- Ledger name
- Display name
- Nominal code
- Category
- Category group
- VAT rate
- Visibility
- Click Save.
- Click on New Ledger Account
- Fill in the relevant information in the fields below-
- Ledger name
- Display name
- Nominal code
- Category
- Category group
- VAT rate
- Visibility
- Click Save
How to Record the Receipt of the Loan?
- Open Sage 50 Accounts
- Go to the Banking menu
- Click on the relevant bank account
- Click on New Entry
- select Sale / Receipt from the drop-down box
- Click on the Other Receipt tab
- Fill in the necessary information in the following fields-
- Date received
- Amount received
- Reference
- Details
- Now Fill in the information required to record the loan such as –
- Ledger account name
- details
- VAT rate
- Loan amount
- Click on Save to record the loan receipt
Click on Save to record the monthly loan repayment and interest accrued. You will need to repeat this procedure every month till the loan is repaid
Also Read : How to Enter Opening Balances in Sage 50
Conclusion
In the sections above, we have discussed a step-by-step procedure to record loans in Sage 50. If you are still having any issues in implementing the steps mentioned above or if you have any more queries, you may consult with some of the authorized Sage experts.
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Frequently Asked Questions(FAQs)
Do I need to Record Loan Repayment in Sage? Where do the Loan repayment and Interest appear?
Yes. Every time you make a loan repayment, you have to record this in Accounting. The repayment is displayed on the Balance Sheet Report and it reduces the balance on the Loans nominal ledger account. The interest on the loan is displayed in your Profit and Loss Report. It increases the balance on the Loan interest paid nominal ledger account.
How can I Record the Repayment of a loan using the Payment Journal in Sage?
1. Click on the Payment Journal tab
2. Select the Make Other Payment tab
3. Select a vendor or create a new vendor for the loan issuer
4. Click on the bank loan liability tab in the Account column
5. Enter the loan amount in the Account column
6. Choose the interest expense account in the next line
7. Enter the interest amount in the Account column
8. Click on the Post/Process tab
How can I Record the repayment of a loan using the General Journal in Sage?
To record the repayment of a loan using the General Journal in Sage:
1. Open the General Journal window.
2. Select the Credit bank account
3. Now click on debit bank loan liability account.
4. Choose Debit interest expense account, if needed.
5. Verify the date
6. Click on the Post/Process tab
What are the documents required for small organizations to apply for a PPP loan in Sage 50?
You need to provide the below-mentioned documents required for small organizations to apply for a PPP Loan in Sage 50–
1. Payroll report summary with the correct bank statements
2. Payroll expenditure confirmation files
3. Documents to show that you have at least a 20% stake
