Bank Loan in P&L

sarahwilson

Can anyone help me? We took out a bank loan to purchase a new phone system and computer system.

On this months profit and loss all the expenses are there for the payment of the phones and computers, but theres no entry anywhere for the bank loan coming in, under misc income or whatever. Am I right in thinking it should be there?If it helps anyone the bank loan has been put to 2311 in sage.

farmergiles

I always thought that outstanding bank loans were shown on the balance sheet and only the interest payable went into p & l. Correct me if my 56 year old grey matter got this wrong...LOL

peugeot

FG is correct - it cannot be classed as 'other income' because it isn't - only the interest payable is a P&L item. The loan is a liability owed to the bank/financier hence a creditor in the bal sheet. 2311 in Sage is a liability code (on the standard chart anyway).

Kind regards
Steve

p.s. should the equipment not be shown as fixed assets rather than expensed ? Maybe worth looking at that also.