Procedures for loan repayments and refunds

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Accounting for your personal loan repayment depends on your form of organization. You refer to yourself as a director, but is your company incorporated? That is, were shares of stock issued? Or do you own it as a sole trader or proprietor?

Regardless of your form of organization, you pay back your friends’ loans using Spend Money from any cash account you have. Allocate the transaction to the friend’s loan account. See the Guide below:

Spending money in cash account

Money withdrawn from your bank account should be recorded under Statement balance column. [image] When you click on the amount under Statement balance column, you can click Spend money button to record new transaction. [image] Every recorded transaction must be properly categorized. For example, if you have spent 200 for telephone, you would record it like this: [image] You can also split the amount across multiple expense categories. This is useful if spent money represents paying off cre…

When you return something you paid for at the time, Receive Money and allocate to the same expense account where you allocated the original purchase. See:

Receiving money in cash account

Money deposited in your bank account should be recorded under Statement balance column. [image] When you click on the amount under Statement balance column, you can click Receive money button to record new transaction. [image] Every recorded transaction must be properly categorized. For example, if you have received 1,200 from customer for sales, you would record it like this: [image] If you have received from customer 1,250 but bank has charged 50 fee, you need to split the transaction us…

If you return something originally recorded via a purchase invoice, issue a Debit Note.