I'm a Sage newbie and would like to create a Director's Loan Account Nominal Code. My accountant has advised me to use code 1300 but is not a Sage user himself.
I know how to create a new nominal code under an existing one but don't know WHERE to create the Director's Loan Account.
I am using the Sage default chart of accounts for the General business type. The only 1xxx codes are under Total Current Assets. The 10xx are under Stock, the 11xx are under Debtors and the 12xx are Banks. Do I create 1300 under the top level of Total Current Assets, under the debtors or somewhere else? I know the placement is crucial to the way that Sage calculates the profit and loss so want to make sure I get it right.
I've searched the net for hours but not found an answer to my query. Can anyone help me?
Replies (8)
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DLA account
Generally, I create it within the range of the bank accounts 12XX so it still appears as an asset/liability on the balance sheet.
One advantage of doing this is it makes payments/receipts easy to do as you can treat it like any other bank account so no need to rely on journals.
John
Sage nominal code
Hi
I suggest the easiest way to do this is to use either the 1101 Other/Sundry Debtors - or 2101 Other/Sundry Creditors. Double click on one of them and re-name it the Directors Current Account. If you have more than one director you will need to have separate ones.
You can add new codes but you will need to know how to edit the Chart Of Accounts to show the Balance Sheet as being correct.
Directors Loan
Hi
Unless otherwise know the Directors Loan is usually long term and therefore you would use the range 2300 to 2399.
You can also do as John says and open a bank account, but you need to change your COA so it sits in the right place in the Balance Sheet.
-- Kind Regards Sarah@ Douglas Accountancy & Bookkeeping Services, Glasgow
show as either asset + liability
set new account up so that it shows in either current asset/ sundry debtor of current liability/ sundry creditor when producing a balance sheet - depending on the nature of the balance DR or CR. this way your balance sheet is correctly stated.
use the sage setup facility to do this [ works like the bank account ssetup if you need to revew ] one of the nicer sage setup functions for balance sheet accounts which frequently switch between DR + CR bals
Current or long term
I set up a new code every time as I delete all codes I'm unlikely to need.
It may be long term or short term depending on how the account is used.
Ensure the account switches between asset and liability as required
How will the account be used?
If the account is being used as a directors float then set it up as a cash account say 1209 post drawings using 'Transfer' and expenses using Bank payments. Bingo, posts like petty cash but if creditor reports as ST Cred. See 'Nominal Ledger' 'Chart of Accounts' 'Default' to see and if necessary amend the code strucutures for reporting.
If it is a long term loan from the director that does not move often then put in long term creditors say 2340. NB this range is set 2300-2399 so no changes needed.
Setting up Staff Loan Nominal Accounts
Hi guys,
I apologise if this question has already been asked but I am trying to set up a staff loan nominal account.
The loan amount has been paid to the staff member already.
I have set up a 1104 code in Sage Line 50, showing as a current asset [being repaid within a year].
My question is, do i say yes to opening balance and input the amount? If this is correct how do i post the payment as i already have the amount in the nominal as an opening balance.
If not, how do i process the initial loan amount payment from bank to employee and record it in the nominal.
Any help would be very much appreciated. Thank you