Notes Payable
why do we show the rolling balance on the balance sheet
because those who use the financial statements of our clients want to see how much they owe and if they are going to be able to service that debt
journal entry to enter notes payable and an asset
debit asset credit notes payable
journal for recording notes payable current portion
debit less current portion of long term debt credit current current portion of long term debt
financers want to see what on the financial statements
how much debt our clients have how much debt do they have for the next 12 months do they have enough cash does the business generate enough cash to be able to pay off that debt they want to see if they can give additional financing to our client
what is the workflow for entering notes payable
put the fixed asset and the notes payable on the books via a journal entry create the bills for the payments when the client makes payments enter the principal and interest in QBO make sure the balance sheet shows the current portion and the less current portion of the long term debt enter those entries and adjust it
notes payable
short term or long term liabilities that a business promises to repay by a certain date. they are loans from banks or directly financed from manufacturers