Johburg74
Dec 23, 2009, 10:45 PM
Hello!
I need to do a journal entry for payments from 4/11/07 to date that are interest not principle reduction.
Please help!
ROLCAM
Dec 25, 2009, 05:02 PM
The journal entries are picked up from the actual payments:-
DEBIT Interest Paid Account
CREDIT Bank Account.
Incidentally the word you need to use is PRINCIPAL not PRINCIPLE.
pready
Jan 1, 2010, 01:30 PM
Debit Interest Expense for the amount of interest paid
Credit Cash for the amount
morgaine300
Jan 4, 2010, 09:25 PM
Theoretically, that's a prior period adjustment. Is this for class, a small company, what? The correct way to take an expense back to 2007 is to subtract it off the beginning retained earnings and not to charge 2007/08 into 09. But for a small company, you might get by with that, depending on who's using the statements and how material it is.