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Jaymz
November 14, 2018
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Bank Transaction and Line of Credit transaction

  • November 14, 2018
  • 1 reply
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I have a line of credit at the same bank as my checking account.  I download the transactions and in my checking account it shows a transfer (payment) to the line of credit I made but in the line of credit account it only shows the principal amount of the payment.  How do I match this up and how do I enter the interest?     

Best answer by Rustler

a line of credit is borrowing money, so the payment has to be split, part of it goes to interest expense and the remainder goes to pay down the line of credit

 

you can fix this with a journal entry for the amount of interest paid

debit interest expense, credit the line of credit account, back date to the payment date

 

 

1 reply

Rustler
RustlerAnswer
November 14, 2018

a line of credit is borrowing money, so the payment has to be split, part of it goes to interest expense and the remainder goes to pay down the line of credit

 

you can fix this with a journal entry for the amount of interest paid

debit interest expense, credit the line of credit account, back date to the payment date

 

 

R
razor518
April 8, 2019

should  the Journal list be in my case where the bank download.  or  creat one seprately. I am a different person from the orginal person asking the quiestion.

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