How to create Loan Accounts in Pastel

[Sheena]

Hi
An employee bought tyres using the company supplier. A monthly deduction was to be made from his salary, however he is receiving his full salary and is paying the company back monthly with his own instalment.
I have been asked to allocate his payments received for that particular invoice amount to a loan account in his name thereby reducing his loan account monthly until the debt is settled.
I am not sure how to go about this
Please help

[Neville Bailey]

When you receive the invoice from the supplier, allocate the amount to the employee's loan account instead of to an expense account. You will have created a loan account as a Balance Sheet item.

When the employee pays the monthly instalments to the company, allocate the payments to the loan account, which will then credit the debit balance on the loan account.

[Sheena]

Hi Neville

Thank you for the feedback.

What Financial Category will the staff loan account be. Will it be Other Current Assets

[Neville Bailey]

Correct.

[Sheena]

Hi Neville,

Thank you for your feedback. The only account I have currently under Other Current Assets. Can I create a sub account under Sundry Customers for the loan account

[Mike C]

Hi Sheena

Can I create a sub account under Sundry Customers for the loan account

That's where ours has been put.

[Sheena]

A staff member received an overpayment for his salary which needs to be allocated as a loan.
Do I capture the entry to Salaries and Wages and then pass a journal debiting the loan account and crediting Salaries and Wages
The loan amount has not been allocated to a loan account for him as yet