Hi there, @carrie14.
Welcome to the Community. I'd be delighted to walk you through the correct procedure in recording and tracking the funds received from a loan.
First off, you'll have to set up a liability account, then record the amount you got from the loan. Here's how:
- Go to the Accounting tab, then select Chart of Accounts.
- Click the New button to create a new account.
- From the Account Type drop-down list, select whether it's a Long Term Liabilities if you plan to pay off the loan by the end of the current fiscal year or Other Current Liabilities instead if it's payable in a short period.
- Choose details that matches your loan in the Detail Type drop-down.
- Add a recognizable name like EIDL loan, then enter the full loan amount as a negative amount in the Amount field since the future payments to the bank are a liability for your business.
- Click Save and close.
Once done, you can now start recording the money you've got from the loan through a journal entry. Here's how:
- Click the + New icon on the left menu.
- Select Journal entry.
- On the first line, select the liability account you just created from the Account drop-down, then enter the loan amount in the Credits column.
- On the second line, select the appropriate asset account from the Account drop-down. Enter the same loan amount in the Debits column.
- Click Save when done.
If you're unsure about the proper account to use, I'd recommend consulting an accountant to make sure your books are accurate.
I've got you an article that can help you when you're ready to record a loan payment in the future: Set up a loan in QuickBooks Online.
Let me know if you additional questions. I'll be around to help. Stay safe.
