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charliez's avatar
charliez
Trusted Cover User
5 years ago

Payment of Sales Invoice against a loan account

Hello,

 

We have an Asset account (Account Type: Other Asset) to record the money we have loaned to our parent company.

 

We also have some Sales Invoices to our parent company - but they won't pay them.  Instead, they want us to reduce the loan account according as a way of paying these Sale Invoices.

 

How do I do this?

 

Thanks in advance.

  • Mike_James's avatar
    Mike_James
    5 years ago

    Hi charliez , that's correct, and it increases the loan account, I was slightly confused in that I took from your first post that head office expected it to reduce.

  • Mike_James's avatar
    Mike_James
    Ultimate Cover User
    5 years ago

    Hi charliez , the sales invoices are debtors, so both them and the loan account are assets and can't be offset. I suggest you point this out.

    • charliez's avatar
      charliez
      Trusted Cover User
      5 years ago

      OK... so here's what I've done.

       

      I've changed the Asset Type of the loan account from "Other Asset" to "Bank".

      I then recorded a payment for the outstanding sale invoices, using this loan account as the "Deposit to Account" ... effectively increasing the loan to the parent company. 

       

      Seems to work OK.  Is there anything I should be aware of?

      • Mike_James's avatar
        Mike_James
        Ultimate Cover User
        5 years ago

        Hi charliez , that's correct, and it increases the loan account, I was slightly confused in that I took from your first post that head office expected it to reduce.

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