Bank Loan in P&L

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sarahwilson
sarahwilson Registered Posts: 567 Epic contributor 🐘
in Chat and off-topic discussion
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.

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  • farmergiles
    farmergiles Registered Posts: 1,693 Beyond epic contributor 🧙‍♂️
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    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
    peugeot Registered Posts: 624 Epic contributor 🐘
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    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.

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