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dadeancolo
May 25, 2024
Question

Can I record checks written out of the Line of Credit?

  • May 25, 2024
  • 3 replies
  • 0 views
Quik Books will not allow me to record checks written on the Line of Credit account which is a liability.

3 replies

M
MichaelaS
May 25, 2024

Yes, you can make written checks out of the line of credit, @dadeancolo.

 

When recording checks written on the line of credit account, ensure to select the financial institution from the Bank Account dropdown and choose the appropriate liability account in the Category column. This is necessary because the program doesn't allow designating a liability account as a payment account for a transaction.

 

Here's how:

 

  1. Select + New.
  2. Under Vendors, select Check.
  3. In the Payee field, select or enter the financial institution's name.
  4. In the Bank Account ▼ dropdown, select the financial institution.
  5. In the Category field, select Line of credit. Then, enter the amount of principal that you want to pay.
  6. In the Category field, select Interest paid. Then, enter the amount of interest you want to pay.
  7. Select Save and Close.

 

If you've already performed these steps and the option isn't visible, I recommend performing basic troubleshooting steps to see if it's a browser issue by opening an incognito/private window. The browser's cache and cookies become corrupted, causing problems when accessing websites or opening files. refer to the following keyboard shortcuts based on your browser type:

 

  • Google Chrome: Ctrl + Shift + N
  • Mozilla Firefox: Ctrl + Shift + P
  • Microsoft Edge: Ctrl + Shift + P
  • Safari: Command + Shift + N

 

If the private browsing session works, clear the browser's cache so the system can restart. This task is also possible in other supported, up-to-date browsers.

 

Furthermore, I'm sharing this article to guide you in automatically download the categorize transactions: Connect bank and credit card accounts.

 

I'm always around if you have other queries about managing your checks. Have a nice day.

Rainflurry
Rainflurry
May 25, 2024

@dadeancolo 

 

Transfer the funds (New > Transfer) from your LOC liability account to the bank account, then write the check from the bank account that holds those funds. 

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dadeancoloAuthor
May 26, 2024

That's extra steps.  The reason the bank gave us checks for the Line of Credit, was to be able to pay for something out of the line without having to go through the steps to transfer money into another account.

    Rainflurry
    Rainflurry
    May 27, 2024

    @dadeancolo 

     

    "That's extra steps."

     

    Yep, but that's a limitation of QB.  You can't write a Check or create an Expense transaction from a liability account.  You can use a journal entry (New > Journal entry): debit the appropriate expense/asset account, credit the LOC liability account.  Journal entries aren't ideal since they don't show on all reports.     

    Rainflurry
    Rainflurry
    May 26, 2024

    @dadeancolo 

     

    The response provided by @MichaelaS is for making a payment (reducing) your LOC balance.  Obviously, they didn't understand your question. 

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