Brewery Discount Statement

JodieR

Previous accounts show a loan to the brewery of £11k and the statement from the brewery shows that the loan is now £8k. There are no actual cash repayments to this loan, it seems to be that each month the outstanding loan is reduced by 5% of the brewery invoices. I'm happy that I need to debit the loan account with £3k for the year, but where does the credit entry go? I'm guessing to the same account which the brewery invoices are coded to, is that correct?

groundy

The credit will be against Purchases. This is standard practice to use discounts offered to repay brewery loans

JodieR

Thanks very much!

JodieR

There's no VAT implications of this is there?

groundy

JodieR wrote: »

There's no VAT implications of this is there?

No