I would like to create nominal code 1300 as suggested by my accountant for a long term Director's Loan. I am using the Sage default chart of accounts.
I know how to create a new code and include it in the chart of accounts, I'm just not sure where I create 1300. Should it be under Total Current Assets, Debtors or somewhere else?
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Nominal Code Help
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brucedenney
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Re: Nominal Code Help
It depends which way the loans is.
I would assume that the loan, as it is long term, is to the company from the director, in this case this is a liability that the business must pay back to the director (the director becomes a creditor of the company) and should be in the range 2xxx (2105 is what I would use.)
But your accountant has said 1300, this is in the Area used for the Bank accounts, which are Debtors (They owe the business the money that the business has lent to them) of course bank accounts can be a grey area, they can be overdrawn so, So it could be a long term loan to a director from the company, even though that is not allowed under company law.
Need more information...
I would assume that the loan, as it is long term, is to the company from the director, in this case this is a liability that the business must pay back to the director (the director becomes a creditor of the company) and should be in the range 2xxx (2105 is what I would use.)
But your accountant has said 1300, this is in the Area used for the Bank accounts, which are Debtors (They owe the business the money that the business has lent to them) of course bank accounts can be a grey area, they can be overdrawn so, So it could be a long term loan to a director from the company, even though that is not allowed under company law.
Need more information...
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