Applying Profit Shares to a Payees Loan

Hi there, @Sunnytears1959,

Welcome, and thanks for taking the time to post here in the Community. I'm here to provide some information about recording loan payments in QuickBooks Desktop (QBDT).

There are a few things you need to set up first before applying the payment to the investor. Among these are:

• Set up a liability account.
• Set up the supplier (Bank/lending company).
• Set up an expense account.
• Record the loan amount.
• Record loan payments.

Let's start by setting up a liability account for the loan. Here's how to do it:

1. In QBDT, go to the Lists menu at the top, then select Chart of Accounts in the drop-down.
2. Right-click anywhere, then tick New.
3. Choose Other Account Types, then pick the right account type for your loan:

• • Other Current Liability: Use this for short-term loans payable over one year.
  • Long Term Liability: Use this for long-term loans payable over a longer period.

1. Select Continue.
2. Enter the name and number for the account.
3. Hit Save & Close.

After that, here's how to set up a supplier for the bank or company you need to pay for the loan:

1. Go to the Suppliers menu at the top, then select Supplier Centre.
2. Click New Supplier.
3. Enter the name of the bank or the company you need to pay for the loan.
4. Hit OK.

Next, let's go ahead and create an expense account so you can track interest payments or fees/charges. Here's how to do it:

1. Go back to the Chart of Accounts.
2. Right-click anywhere, then select New.
3. Choose Expense, then Continue.
4. Enter the account name for the interest payments or fees/charges.
5. Hit Save & Close.

Once done, you can now proceed with recording the loan amount and the payment. You may refer to this article and go directly to steps 4 and 5 for the detailed steps to do it: Manually track loans in QuickBooks Desktop.

If you want to keep track of your loans and be reminded about upcoming payments, you can track and manage your loans with the QuickBooks Loan Manager.

Let me know if there's anything that I can help you with the process or anything else in QuickBooks. Take care and have a great rest of the day!